Accounting Policies of Hariom Pipe Industries Ltd. Company

Mar 31, 2025

1. MATERIAL ACCOUNTING POLICIES

(a) Statement of compliance:

These standalone financial statements have been
prepared in accordance with the provisions of the
Companies Act, 2013 and the Indian Accounting
Standards (“Ind AS") notified under the Companies
(Indian Accounting Standards) Rules, 2015, as
amended, issued by Ministry of Corporate Affairs under
section 133 of the Companies Act 2013 ("the Act"). In
addition, the Guidance Notes/announcements issued
by the Institute of Chartered Accountants of India
(ICAI) from time to time are also applied except where
compliance with other statutory promulgations require
a different treatment. These standalone financials
statements have been approved for issue by the Board
of Directors at their meeting held on May 09, 2025.

(b) Basis of preparation:

The Company maintains accounts on accrual basis
following the historical cost convention, except for
certain financial instruments that are measured at fair
value in accordance with the requirement of Ind AS.
The carrying value of all the items of property, plant
and equipment and investment property as on date of
transition is considered as the deemed cost. Fair value
measurements under Ind AS are categorized as below

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:

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

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

Level 3 - inputs are unobservable inputs for the valuation
of assets/liabilities

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 116, and measurements that have some
similarities to fair value but are not fair value, such as net
realizable value in Ind AS 2 or value in use in Ind AS 36.

(c) Presentation of Financial Statements

The standalone Balance Sheet, the standalone
Statement of Profit and Loss and the standalone
Statement of Changes in Equity are prepared and
presented in the formats prescribed under Schedule
III Division (ii) to the Act. The Statement of cash flows
is prepared and presented as per the requirements
of Ind AS 7 “Statement of Cash flows". The disclosure
requirements with respect to items in the standalone
Balance Sheet, standalone Statement of Profit and
Loss and standalone Statement of Change in Equity as
prescribed in the Schedule III Division (ii) to the Act, are
presented by way of notes forming part of the financial
statements along with the other notes required to be
disclosed under the notified IND AS.

(d) Use of estimates and critical accounting
judgments:

In preparation of these standalone financial statements,
the Company makes judgments in the application of
accounting policies, estimates and assumptions which
affects the carrying values of assets and liabilities that
are not readily available/apparent from other sources.
The estimates and the associated assumptions are
based on historical experience and other factors that are
considered to be relevant. Actual results may differ from
these estimates.

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

The following are the critical judgments, apart from those
involving estimations that the directors have made in the
process of applying the Company''s accounting policies
and that have the most significant effect on the amounts
recognised in the standalone financial statements.

Deferred income tax assets and liabilities:

Significant management judgment is required to
determine the amount of deferred tax assets that can be
recognised, based upon the likely timing and the level of
future taxable profits.

The amount of total deferred tax assets/ (Liabilities)
could change if estimates of projected future taxable
income or if tax regulations undergo a change.

Income Taxes:

Deferred tax assets are recognized to the extent that
it is regarded as probable that deductible temporary
differences can be realized. The Company estimates
deferred tax assets and liabilities based on current tax
laws and rates and in certain cases, business plans,
including management''s expectations regarding the
manner and timing of recovery of the related assets.
Changes in these estimates may affect the amount of
deferred tax liabilities or the valuation of deferred tax
assets and thereby the tax charges in the Statement of
Profit or Loss.

Provision for tax liabilities require judgments on the
interpretation of tax legislation, developments in case
law and the potential outcomes of tax audits and appeals
which may be subject to significant uncertainty.

Therefore, the actual results may vary from expectations
resulting in adjustments to provisions, the valuation of
deferred tax assets, cash tax settlements and therefore
the tax charge in the Statement of Profit or Loss."

Useful lives of Property, plant and equipment
(‘PPE''):

The Company reviews the estimated useful lives and
residual value of PPE at the end of each reporting
period. The factors such as changes in the expected
level of usage, technological developments and product
life-cycle, could significantly impact the economic
useful lives and the residual values of these assets.
Consequently, the future depreciation charge could be
revised and thereby could have an impact on the profit of
the future years.

Defined benefit plans:

The cost of the defined benefit plans and the present
value of the defined benefit obligation (''DBO'') are based
on actuarial valuation using the projected unit credit
method. An actuarial valuation involves making various
assumptions that may differ from actual developments
in the future. These include the determination of the
discount rate; future salary increases and mortality
rates. Due to the complexities involved in the valuation
and its long-term nature, a defined benefit obligation

is highly sensitive to changes in these assumptions. All
assumptions are reviewed at each reporting date.

Fair value measurement of Compound Financial
Instruments:

The Company recognizes separately the components of
a financial instrument that (a) creates a financial liability
of the entity and (b) grants an option to the holder of
the instrument to convert it into an equity instrument of
the entity. From the perspective of the Company, such
an instrument comprises two components: a financial
liability (a contractual arrangement to deliver cash or
another financial asset) and an equity instrument (a
call option granting the holder the right, for a specified
period of time, to convert it into a fixed number of
ordinary shares of the entity).

(e) Current and non-current classification and
operating cycle:

All the assets and liabilities have been classified as
current or noncurrent as per the Company''s normal
operating cycle and other criteria set out in the Schedule
III to the Companies Act, 2013.

Assets:

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

it is expected to be realised in, or is intended for sale or
consumption in, the Company''s normal operating cycle;

it is held primarily for the purpose of being traded;

it is expected to be realised within twelve months after
the reporting date; or

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

Liabilities:

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

i t is expected to be settled in the Company''s normal
operating cycle;

it is held primarily for the purpose of being traded;

i t is due to be settled within twelve months after the
reporting date; or

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

All other assets/ liabilities are classified as non-current.

(f) Functional and presentation currency:

The financial statements are presented in Indian rupee
(INR) (rounded off to Rs. In lakhs), which is functional
and presentation currency.

(g) Revenue recognition:

The revenue is recognized once the entity satisfied that
the performance obligation & control are transferred to
the customers.

Revenue towards satisfaction of a performance
obligation is measured at the amount of transaction
price (Net of variable consideration) allocated to that
performance obligation. The transaction price of
goods sold and services rendered is net of Variable
consideration on account of.

(i) Sale of goods:

The Company derives revenue from Sale of Goods
and revenue is recognized upon transfer of control
of promised goods to customers in an amount that
reflects the consideration the Company expects to
receive in exchange for those goods in accordance
with IND AS 115 "Revenue from Contracts with
Customers". To recognize revenues, the Company
applies the following five step approach: (1)
identify the contract with a customer, (2) identify
the performance obligations in the contract, (3)
determine the transaction price, (4) allocate the
transaction price to the performance obligations in
the contract, and (5) recognize revenues when a
performance obligation is satisfied.

Any change in scope or price is considered as a
contract modification. The Company accounts
for modifications to existing contracts by
assessing whether the services added are distinct
and whether the pricing is at the standalone
selling price.

The Company accounts for variable considerations
like, volume discounts, rebates and pricing
incentives to customers as reduction of revenue on
a systematic and rational basis over the period of
the contract. The Company estimates an amount
of such variable consideration using expected
value method or the single most likely amount
in a range of possible consideration depending
on which method better predicts the amount of
consideration to which we may be entitled.

(ii) Other income

A. Interest income is accrued on a time basis by
reference to the principal outstanding and
the effective interest rate.

B Other items of income are accounted as and
when the right to receive such income arises
and it is probable that the economic benefits
will flow to the company and the amount of
income can be measured reliably

(h) Foreign currency translation:

(i) The standalone financial statements are presented
in Indian rupee (INR), which is functional and
presentation currency.

(ii) Transactions and balances:

Foreign currency transactions are translated into
the functional currency using the exchange rates
at the dates of the transactions. Foreign exchange
gains and losses resulting from the settlement
of such transactions and from the translation of
monetary assets and liabilities denominated in
foreign currencies at year end exchange rates are
generally recognised in standalone Statement of
Profit and Loss.

Foreign exchange differences regarded as an
adjustment to borrowing costs are presented in
the standalone Statement of Profit and Loss, within
finance costs. All other foreign exchange gains and
losses are presented in the standalone Statement
of Profit and Loss on a net basis within other gains/
(losses).

(i) Segment reporting

An operating segment is a component of the Company
that engages in business activities from which it may
earn revenues and incur expenses, including revenues
and expenses that relate to transactions with any of the
Company''s other components, and for which discrete
financial information is available. Operating segments
are reported in a manner consistent with the internal
reporting provided to the chief operating decision maker
(''CODM'').

The Company''s Board has identified the CODM who is
responsible for financial decision making and assessing
performance. The Company has a single operating
segment as the operating results of the Company are
reviewed on an overall basis by the CODM.

(j) Exceptional items:

An item of income or expense which by its size, type or
incidence requires disclosure in order to improve an
understanding of the performance of the company is
treated as an exceptional item and the same is disclosed
in the notes to accounts.

(k) Property, plant and equipment and capital
work-in- progress:

Freehold land is carried at historical cost. All other items
of property, plant and equipment are stated at historical
cost less depreciation and impairment, if any. Historical
cost includes expenditure that is directly attributable to
the acquisition of the items.

Cost is inclusive of inward freight, net of tax/duty
credits availed, if any, and incidental expenses related
to acquisition or construction. All upgradation /
enhancements are charged off as revenue expenditure
unless they bring similar significant additional
benefits. An item of property, plant and equipment is
derecognised upon disposal or when no future economic
benefits are expected to arise from the continued use
of asset.

Subsequent costs are included in the asset''s
carrying amount or recognised as a separate asset,
as appropriate, only when it is probable that future
economic benefits associated with the item will flow to
the Company and the cost of the item can be measured
reliably. The carrying amount of any component
accounted for as a separate asset is derecognised when
replaced. All other repairs and maintenance are charged
to Statement of Profit or Loss during the reporting period
in which they are incurred.

Land acquired on lease for period exceeding 90 years
is recognized as leasehold land at the cost, at the
time of lease commencement. Any initial direct cost
related to acquiring leasehold land (including expenses
incurred to bring the land into use) are capitalized and
included in the cost of asset. The policy is based on
the understanding that leasehold land is generally
considered to have an extended economic life and
does not experience a significant decline in value over
the lease terms. Leasehold land will not be subject
to depreciation

Projects under which tangible property, plant and
equipment are not yet ready for their intended use
are carried at cost, comprising of direct cost, related
incidental expenses and attributable interest in case of
qualifying assets.

Any excess of net sale proceeds of items produced over
the cost of testing, if any, is deducted from the directly
attributable costs considered as part of cost of an item of
property, plant, and equipment.

Machinery spares which can be used only in connection
with an item of property, plant and equipment and
whose use is expected to be irregular are capitalized and
depreciated over the useful life of the principal item of
the relevant assets.

Capital work-in-progress:

Projects under which tangible Property, Plant &
Equipment are not yet ready for their intended use are
carried at cost, comprising direct cost, net of tax/duty
credits availed, if any, related incidental expenses and
attributable interest, in case of qualifying assets.

Depreciation methods, estimated useful lives and
residual value:

Depreciation is systematically allocated over the useful
life of the asset as specified in Schedule II of the Act on
Written Down Method. Depreciation on property, plant
and equipment added/disposed of during the year is
provided on pro-rata basis with reference to the date of
addition/disposal. Freehold land is not depreciated.

(l) Intangible assets

Intangible assets are recognised when it is probable
that the future economic benefits that are attributable
to the asset will flow to the enterprise and the cost of the
asset can be measured reliably. Intangible assets are
stated at original cost net of tax/duty credits availed, if
any, less accumulated amortisation and cumulative

impairment. Administrative and other general overhead
expenses that are specifically attributable to acquisition
of intangible assets are allocated and capitalised as a
part of the cost of the intangible assets.

Research and development expenditure on new
products:

Expenditure on research is expensed under respective
heads of account in the period in which it is incurred.

Development expenditure on new products is
capitalised as intangible asset, if all of the following can
be demonstrated:

A. the technical feasibility of completing the
intangible asset so that it will be available for use
or sale;

B. the company has intention to complete the
intangible asset and use or sell it;

C. the company has ability to use or sell the
intangible asset;

D. the manner in which the probable future economic
benefits will be generated including the existence
of a market for output of the intangible asset or
intangible asset itself or if it is to be used internally,
the usefulness of intangible assets;

E. the availability of adequate technical, financial and
other resources to complete the development and
to use or sell the intangible asset; and

F. the company has ability to reliably measure the
expenditure attributable to the intangible asset
during its development.

Development expenditure that does not meet the above
criteria is expensed in the period in which it is incurred.
Intangible assets not ready for the intended use on the
date of the Balance Sheet are disclosed as "intangible
assets under development". Intangible assets are
amortized on straight line basis over the estimated
useful life. The method of amortization and useful life
are reviewed at the end of each accounting year with the
effect of any changes in the estimate being accounted
for on a prospective basis. Amortization on impaired
assets is provided by adjusting the amortization charge
in the remaining periods so as to allocate the asset''s
revised carrying amount over its remaining useful life.

(m) Impairment of assets:

At each balance sheet date, the Company reviews the
carrying values of its property, plant and equipment
and intangible assets to determine whether there is any
indication that the carrying value of those assets may
not be recoverable through continuing use. If any such
indication exists, the recoverable amount of the asset is
reviewed in order to determine the extent of impairment
loss (if any). Where the assets do not generate cash
flows that are independent from other assets, the
Company estimates the recoverable amount of the cash
generating unit to which the asset belongs.

Recoverable amount is the highest of fair value less
costs to sell and value in use. In assessing value in
use, the estimated future cash flows are discounted to
their present value using a pre-tax discount rate that
reflects current market assessments of the time value
of money and the risks specific to the asset for which the
estimates of future cash flows have not been adjusted.
An impairment loss is recognised in the statement of
profit and loss as and when the carrying value of an asset
exceeds its recoverable amount.

Where an impairment loss subsequently reverses, the
carrying value of the asset (or cash generating unit)
is increased to the revised estimate of its recoverable
amount so that the increased carrying value does
not exceed the carrying value that would have been
determined had no impairment loss been recognised for
the asset (or cash generating unit) in prior years.

(n) Employee benefits:

(i) Short-term obligations:

Liabilities for wages and salaries, including non¬
monetary benefits that are expected to be settled
wholly within 12 months after the end of the
period in which the employees render the related
service are recognised in respect of employees''
services up to the end of the reporting period and
are measured at the amounts expected to be paid
when the liabilities are settled. The liabilities are
presented as current employee benefit obligations
in the Balance Sheet.

(ii) Other long-term employee benefit obligations:

The liabilities for earned leave and sick leave
are not expected to be settled wholly within 12
months after the end of the period in which the
employees render the related service. They
are therefore measured as the present value of
expected future payments to be made in respect
of services provided by employees up to the end
of the reporting period using the projected unit
credit method. The benefits are discounted using
the market yields at the end of the reporting period
that have terms approximating to the terms of the
related obligation. Remeasurements as a result of
experience adjustments and changes in actuarial
assumptions are recognised in profit or loss.

The obligations are presented as current liabilities
in the balance sheet if the entity does not have
an unconditional right to defer settlement for at
least twelve months after the reporting period,
regardless of when the actual settlement is
expected to occur.

(iii) Post-employment obligations:

Defined contribution plans: The Company''s
contribution to provident fund are considered as
defined contribution plans and are charged as an
expense to the Statement of Profit and Loss based
on the amount of contribution required to be made
and when services are rendered by the employees.

Defined benefit plans: For defined benefit plans
in the form of gratuity fund, the cost of providing
benefits is determined using the Projected Unit
Credit method, with actuarial valuations being
carried out at each balance sheet date. Actuarial
gains and losses are recognised in the Other
Comprehensive Income in the period in which they
occur. Past service cost is recognised immediately
to the extent that the benefits are already vested
and otherwise is amortised on a straight-line
basis over the average period until the benefits
become vested. The retirement benefit obligation
recognised in the Balance Sheet represents the
present value of the defined benefit obligation
as adjusted for unrecognised past service cost,
as reduced by fair value of plan assets (being the
funded portion).

The Company operates a defined benefit gratuity
plan, which requires contributions to be made to
a separately administered fund managed by an
insurance company.

(o) Lease

The Company assesses whether a contract contains
a lease, at inception of a contract. A contract is, or
contains, a lease if the contract conveys the right to
control the use of an identified asset for a period of
time in exchange for consideration. To assess whether
a contract conveys the right to control the use of an
identified asset, the Company assesses whether:

(i) the contract involves the use of an identified asset

(ii) the Company has substantially all of the economic
benefits from use of the asset through the period of
the lease, and

(iii) the Company has the right to direct the use of
the asset

At the date of commencement of the lease, the Company
recognizes a right-of-use asset and a corresponding
lease liability for all lease arrangements in which it is a
lessee, except for leases with a term of twelve months
or less (short-term leases) and low value leases. For
these short-term and low value leases, the Company
recognizes the lease payments as an operating expense
on a straight-line basis over the term of the lease

The right-of-use assets are initially recognized at cost,
which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the
commencement date of the lease plus any initial direct
costs less any lease incentives. They are subsequently
measured at cost less accumulated depreciation and
impairment losses

Right-of-use assets are depreciated on a straight¬
line basis over the lease term. Right of use assets
are evaluated for recoverability whenever events or
changes in circumstances indicate that their carrying
amounts may not be recoverable. For the purpose of
impairment testing, the recoverable amount (i.e., the
higher of the fair value less cost to sell and the value-in-

use) is determined on an individual asset basis unless
the asset does not generate cash flows that are largely
independent of those from other assets

The lease liability is initially measured at amortized
cost at the present value of the future lease payments.
The lease payments are discounted using the interest
rate implicit in the lease or, if not readily determinable,
using the incremental borrowing rates in the country
of domicile of these leases. Lease liabilities are
remeasured with a corresponding adjustment to the
related right of use asset if the Company changes its
assessment if whether it will exercise an extension or a
termination option

Lease liability and ROU asset have been separately
presented in the Balance Sheet and lease payments
have been classified as financing cash flows

(p) Financial instruments - initial recognition,
subsequent measurement and impairment:

A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.

A. Investments and other financial assets
(i) Classification:

The Company classifies its financial assets in the
following measurement categories:

• those to be measured subsequently at fair value
(either through other comprehensive income,
or through profit or loss), and

• those measured at amortised cost.

• those measured at cost.

The classification depends on the company''s
business model for managing the financial assets
and the contractual terms of the cash flows.

For assets measured at fair value, gains and losses
will either be recorded in the statement of profit or
loss or other comprehensive income.

The investment in subsidiary is measured at cost
less impairment, if any

The classification criteria of the Company for debt
instruments are provided as under:

Debt instruments:

Depending upon the business model of the
Company, debt instruments can be classified
under following categories:

• Debt instruments measured at amortised cost

• Debt instruments measured at fair value
through other comprehensive income

• Debt instruments measured at fair value
through profit or loss

The Company reclassifies debt instruments when
and only when its business model for managing
those assets changes.

(ii) Measurement:

At initial recognition, the Company measures
a financial asset at its fair value plus, in the case
of a financial asset not at fair value through
profit or loss, transaction costs that are directly
attributable to the acquisition of the financial
asset. Transaction costs of financial assets carried
at fair value through profit or loss are expensed in
the standalone statement of profit or loss.

Debt instruments:

Subsequent measurement of debt instruments
depends on the Company''s business model
for managing the asset and the cash flow
characteristics of the asset. There are three
measurement categories into which the Company
classifies its debt instruments:

Amortised cost: Assets that are held for collection
of contractual cash flows where those cash
flows represent solely payments of principal and
interest are measured at amortised cost. A gain
or loss on a debt investment that is subsequently
measured at amortised cost and is not part
of a hedging relationship is recognised in the
standalone statement of profit or loss when the
asset is derecognised or impaired. Interest income
from these financial assets is included in finance
income using the effective interest rate method.

Fair value through other comprehensive income:

Assets that are held for collection of contractual
cash flows and for selling the financial assets,
where the assets'' cash flows represent solely
payments of principal and interest, are measured
at fair value through other comprehensive
income. Movements in the carrying amount are
taken through OCI, except for the recognition
of impairment gains or losses, interest revenue
and foreign exchange gains and losses which are
recognised in profit and loss. When the financial
asset is derecognised, the cumulative gain or
loss previously recognised in OCI is reclassified
from equity to profit or loss and recognised in
other gains/ (losses). Interest income from these
financial assets is included in other income using
the effective interest rate method.

Fair value through profit or loss: Assets that do not
meet the criteria for amortised cost or FVOCI are
measured at fair value through profit or loss. A gain
or loss on a debt investment that is subsequently
measured at fair value through profit or loss and is
not part of a hedging relationship is recognised and
presented net in the standalone statement of profit
and loss within other gains/(losses) in the period
in which it arises. Interest income from these
financial assets is included in other income.

(iii) Impairment of financial assets:

The Company assesses on a forward-looking
basis the expected credit losses associated with
its assets carried at amortised cost and FVOCI
debt instruments. The impairment methodology
applied depends on whether there has been a
significant increase in credit risk. Note 36 details
how the Company determines whether there has
been a significant increase in credit risk.

For trade receivables only, the Company applies
the simplified approach permitted by Ind AS 109
Financial Instruments, which requires expected
lifetime losses to be recognised from initial
recognition of the receivables.

Expected credit losses are measured through a
loss allowance at an amount equal to the following:

(a) the 12-months expected credit losses
(expected credit losses that result from
default events on financial instrument that
are possible within 12 months after reporting
date); or

(b) Full lifetime expected credit losses (expected
credit losses that result from those default
events on the financial instrument).

The Company follows ''simplified approach'' for
recognition of impairment loss allowance on trade
receivable. Under the simplified approach, the
Company does not track changes in credit risk.
Rather, it recognizes impairment loss allowance
based on lifetime ECLs at each reporting date,
right from initial recognition.

The Company uses a provision matrix to determine
impairment loss allowance on the portfolio of
trade receivables. The provision matrix is based
on its historically observed default rates over
the expected life of the trade receivable and is
adjusted for forward looking estimates. At every
reporting date, the historical observed default
rates are updated and changes in the forward¬
looking estimates are analysed.

I ndividual receivables which are known to be
uncollectible are written off by reducing the
carrying amount of trade receivable and the
amount of the loss is recognised in the Statement
of Profit and Loss within other expenses.

Subsequent recoveries of amounts previously
written off are credited to other income.

(iv) Derecognition of financial assets:

A financial asset is derecognised only when:

• the Company has transferred the rights to
receive cash flows from the financial asset or

• retains the contractual rights to receive the
cash flows of the financial asset but assumes a
contractual obligation to pay the cash flows to
one or more recipients.

Where the Company has transferred an asset, the
Company evaluates whether it has transferred
substantially all risks and rewards of ownership
of the financial asset. In such cases, the financial
asset is derecognised. Where the Company has
not transferred substantially all risks and rewards
of ownership of the financial asset, the financial
asset is not derecognised.

Where the Company has neither transferred a
financial asset nor retains substantially all risks
and rewards of ownership of the financial asset,
the financial asset is derecognised if the Company
has not retained control of the financial asset.
Where the Company retains control of the financial
asset, the asset is continued to be recognised
to the extent of continuing involvement in the
financial asset.

B. Financial Liabilities:

(a) Classification:

The Company classifies its financial liabilities in the
following measurement categories:

• Financial liabilities measured at fair value
through profit or loss

• Financial liabilities measured at amortized cost

(b) Measurement:

The measurement of financial liabilities depends
on their classification, as described below:

Financial liabilities measured at fair value
through profit or loss:

Financial liabilities at fair value through profit or
loss include financial liabilities held for trading.
At initial recognition, such financial liabilities are
recognised at fair value.

Financial liabilities at fair value through profit
or loss are, at each reporting date, measured at
fair value with all the changes recognized in the
Statement of Profit and Loss.

Financial liabilities measured at Amortized Cost:

At initial recognition, all financial liabilities other
than fair valued through profit and loss are
recognised initially at fair value less transaction
costs that are attributable to the issue of financial
liability. Transaction costs of financial liability
carried at fair value through profit or loss is
expensed in the statement of profit or loss.

After initial recognition, financial liabilities are
subsequently measured at amortised cost using
the effective interest method. Any difference
between the proceeds (net of transaction costs)
and the redemption amount is recognised in the
statement of profit or loss over the period of the
financial liabilities 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.

(c) De-recognition of financial liability:

A financial liability is derecognised when the
obligation under the liability is discharged or
cancelled or expires. The difference between the
carrying amount of a financial liability that has
been extinguished or transferred to another party
and the consideration paid, including any non¬
cash assets transferred or liabilities assumed,
is recognised in the statement of profit or loss as
other income or finance costs.

(d) Compound financial instruments:

Compound financial instruments issued by
the company which can be converted into
fixed number of equity shares at the option
of the holders irrespective of changes in the
fair value of the instrument are accounted by
separately recognising the liability and the equity
components. The liability component is initially
recognised at the fair value of a comparable liability
that does not have an equity conversion option.
The equity component is initially recognised at the
difference between the fair value of the compound
financial instrument as a whole and the fair value
of the liability component. The directly attributable
transaction costs are allocated to the liability and
the equity components in proportion to their initial
carrying amounts.

Subsequent to initial recognition, the liability
component of the compound financial instrument
is measured at amortised cost using the effective
interest method. The equity component
of a compound financial instrument is not
remeasured subsequently.

(q) Offsetting financial instruments:

Financial assets and liabilities are offset, and the net
amount is reported in the Balance Sheet where there
is a legally enforceable right to offset the recognised
amounts and there is an intention to settle on a net basis
or realise the asset and settle the liability simultaneously.
The legally enforceable right must not be contingent on
future events and must be enforceable in the normal
course of business and in the event of default, insolvency
or bankruptcy of the Company or the counterparty.

(r) Inventories:

Raw materials, consumable stores, stores and spares,
and finished goods inventories are valued at the lower
of cost (using weighted average method) and the net
realisable value after providing for obsolescence and
other losses, where considered necessary. Cost includes
cost of purchase, all charges in bringing the goods to the
point of sale, including indirect levies, net of recoveries,
if any, transit insurance and receiving charges. Finished
goods include appropriate proportion of overheads and,
where applicable. Cost of inventories also includes all

other costs incurred in bringing the inventories to their
present location and condition.

Raw materials and stores are considered to be realisable
at cost if the finished products in which they will be used,
are expected to be sold at or above cost.

Assessment of net realisable value is made in each
subsequent period and when the circumstances that
previously caused inventories to be written-down below
cost no longer exist or when there is clear evidence of
an increase in net realisable value because of changed
economic circumstances, the write-down, if any, in
the past period is reversed to the extent of the original
amount written-down so that the resultant carrying
amount is the lower of the cost and the revised net
realisable value.

(s) Cash and cash equivalents:

Cash and bank balances include fixed deposits, margin
money deposits, earmarked balances with banks
and other bank balances which have restrictions on
repatriation. Short-term and liquid investments being
subject to more than insignificant risk of change in value,
are not included as part of cash and cash equivalents.

(t) Securities premium account:

Securities premium includes the difference between the
face value of the shares and the consideration received
in respect of shares issued.

The issue expenses of securities which qualify as equity
instruments are written off against securities premium
account, if and when such expenses are incurred, and
as per the decision of the management.

(u) Borrowing costs:

General and specific borrowing costs (includes interest
expense calculated using the effective interest method,
other costs and expenses in relation to the borrowing)
that are directly attributable to the acquisition,
construction or production of a qualifying asset are
capitalised during the period of time that is required to
complete and prepare the asset for its intended use or
sale. Qualifying assets are assets that necessarily take a
substantial period of time to get ready for their intended
use or sale.

Investment income earned on the temporary investment
of specific borrowings pending their expenditure on
qualifying assets is deducted from the borrowing costs
eligible for capitalisation.

All other borrowing costs are recognised in profit or loss
in the period in which these are incurred.

(v) Cash Flow Statement:

For the purpose of presentation in the Statement of
Cash Flows, cash and cash equivalents includes cash
on hand, other short- term, highly liquid investments
with original maturities of three months or less that are
readily convertible to known amounts of cash and which
are subject to an insignificant risk of changes in value.

Cash flows are reported using the indirect method,
whereby net profit before tax is adjusted for the effects
of transactions of a non-cash nature, any deferrals or
accruals of past or future cash receipts or payments.
The cash flows from operating, investing and financing
activities of the Company are segregated based on the
available information.

Short term borrowings, repayments and advances
having maturity of three months or less, are shown as
net in cash flow statement.

(w) Income tax:

The income tax expense for the period is the tax payable
on the current period''s taxable income based on the
applicable income tax rate for each year adjusted by
changes in deferred tax assets and liabilities attributable
to temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis
of the tax laws enacted or substantively enacted at the
end of the reporting period. Management periodically
evaluates positions taken in tax returns with respect to
situations in which applicable tax regulation is subject
to interpretation. It establishes provisions where
appropriate on the basis of amounts expected to be paid
to the tax authorities.

Deferred income tax is provided in full, using the liability
method, on temporary differences arising between the
tax bases of assets and liabilities and their carrying
amounts in the financial statements. Deferred income
tax is determined using tax rates (and laws) that have
been enacted or substantially enacted by the end of
the reporting period and are expected to apply when
the related deferred income tax asset is realised or the
deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilize those temporary differences and losses. Minimum
Alternate Tax (MAT) is not recognized as a deferred tax
asset as the company is not liable for MAT tax

Deferred tax assets and liabilities are offset when there
is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate
to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally
enforceable right to offset and intends either to settle
on a net basis, or to realize the asset and settle the
liability simultaneously.

The carrying value of deferred tax assets is reviewed
at the end of each reporting period and reduced to the
extent that it is no longer probable that sufficient taxable
profits will be available to allow all or part of the asset to
be recovered.

Current and deferred tax is recognised in Statement
of Profit and Loss, except to the extent that it relates
to items recognised in Other Comprehensive Income.
In such case, the tax is also recognised in Other
Comprehensive Income.

---

Mar 31, 2024

1. MATERIAL ACCOUNTING POLICIES

(a) Statement of compliance:

The company''s financial statements have been prepared in accordance with the provisions of the Companies Act, 2013 and the Indian Accounting Standards ("Ind AS") notified under the Companies (Indian Accounting Standards) Rules, 2015, as amended, issued by Ministry of Corporate Affairs under section 133 of the Companies Act 2013 ("the Act"). In addition, the Guidance Notes/announcements issued by the Institute of Chartered Accountants of India (ICAI) from time to time are also applied except where compliance with other statutory promulgations require a different treatment. These financials statements have been approved for issue by the Board of Directors at their meeting held on May 17, 2024.

(b) Basis of preparation:

The Company maintains accounts on accrual basis following the historical cost convention, except for certain financial instruments that are measured at fair value in accordance with Ind AS. The carrying value of all the items of property, plant and equipment and investment property as on date of transition is considered as the deemed cost. Fair value measurements under Ind AS are categorized as below 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:

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

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

Level 3 - inputs are unobservable inputs for the valuation of assets/liabilities

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 116, and measurements that have some similarities to fair value but are not fair value, such as net realizable value in Ind AS 2 or value in use in Ind AS 36.

(c) Presentation of Financial Statements

The Ind AS Balance Sheet, the Ind AS Statement of Profit and Loss and Ind AS statement of Change in Equity are prepared and presented in the format prescribed in the Schedule III Division (ii) to the Act. The statement of cash flows has been prepared and presented as per the requirements of Ind AS 7 "Statement of

Cash flows". The disclosure requirements with respect to items in the Balance Sheet, Statement of Profit and Loss and statement of Change in Equity as prescribed in the Schedule III Division

(ii) to the Act, are presented by way of notes forming part of the financial statements along with the other notes required to be disclosed under the notified IND AS.

(d) Use of estimates and critical accounting judgments:

In preparation of the financial statements, the Company makes judgments, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and the associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

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

The following are the critical judgments, apart from those involving estimations that the directors have made in the process of applying the Company''s accounting policies and that have the most significant effect on the amounts recognised in the financial statements.

Deferred income tax assets and liabilities:

Significant management judgment is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits.

The amount of total deferred tax assets/ (Liabilities) could change if estimates of projected future taxable income or if tax regulations undergo a change.

Income Taxes:

Deferred tax assets are recognized to the extent that it is regarded as probable that deductible temporary differences can be realized. The Company estimates deferred tax assets and liabilities based on current tax laws and rates and in certain cases, business plans, including management''s expectations regarding the manner and timing of recovery of the related assets. Changes in these estimates may affect the amount of deferred tax liabilities or the valuation of deferred tax assets and thereby the

tax charges in the Statement of Profit or Loss.

Provision for tax liabilities require judgments on the interpretation of tax legislation, developments in case law and the potential outcomes of tax audits and appeals which may be subject to significant uncertainty.

Therefore, the actual results may vary from expectations resulting in adjustments to provisions, the valuation of deferred tax assets, cash tax settlements and therefore the tax charge in the Statement of Profit or Loss."

Useful lives of Property, plant and equipment (PPE):

The Company reviews the estimated useful lives and residual value of PPE at the end of each reporting period. The factors such as changes in the expected level of usage, technological developments and product life-cycle, could significantly impact the economic useful lives and the residual values of these assets. Consequently, the future depreciation charge could be revised and thereby could have an impact on the profit of the future years.

Defined benefit plans:

The cost of the defined benefit plans and the present value of the defined benefit obligation (''DBO'') are based on actuarial valuation using the projected unit credit method. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate; future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

Fair value measurement of Compound Financial Instruments:

The Company recognizes separately the components of a financial instrument that (a) creates a financial liability of the entity and (b) grants an option to the holder of the instrument to convert it into an equity instrument of the entity. From the perspective of the Company, such an instrument comprises two components: a financial liability (a contractual arrangement to deliver cash or another financial asset) and an equity instrument (a call option granting the holder the right, for a specified period of time, to convert it into a fixed number of ordinary shares

Estimation of uncertainties relating to the global health pandemic from COVID-19:

The Company has assessed the impact of Covid-19 pandemic on its business operations and has considered relevant internal and external information available up to the date of approval of these financial statements, in determination of the recoverability and carrying value of property, plant and equipment, inventories, and trade receivables. Based on current estimates, the Company expects the carrying amount of these assets will be recovered. Further, the management believes that there may not be significant impact of Covid-19 pandemic on the financial position and performance of the Company, in the long-term. The Company will continue to closely monitor any material changes to future economic conditions.

(e) Current and non-current classification and operating cycle:

All the assets and liabilities have been classified as current or noncurrent as per the Company''s normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013.

Assets:

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

it is expected to be realised in, or is intended for sale or consumption in, the Company''s normal operating cycle;

it is held primarily for the purpose of being traded;

it is expected to be realised within twelve months after the reporting date; or

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

Liabilities:

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

it is expected to be settled in the Company''s normal operating cycle;

it is held primarily for the purpose of being traded;

it is due to be settled within twelve months after the reporting date; or

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

All other assets/ liabilities are classified as noncurrent.

(f) Functional and presentation currency:

The financial statements are presented in Indian rupee (INR) (rounded off to Rs. In lakhs), which is functional and presentation currency.

(g) Revenue recognition:

The revenue is recognized once the entity satisfied that the performance obligation & control are transferred to the customers.

Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price (Net of variable consideration) allocated to that performance obligation. The transaction price of goods sold and services rendered is net of Variable consideration on account of.

(i) Sale of goods:

The Company derives revenue from Sale of Goods and revenue is recognized upon transfer of control of promised goods to customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods in accordance with IND AS 115 "Revenue from Contracts with Customers". To recognize revenues, the Company applies the following five step approach: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenues when a performance obligation is satisfied.

Any change in scope or price is considered as a contract modification. The Company accounts for modifications to existing contracts by assessing whether the services added are distinct and whether the pricing is at the standalone selling price.

The Company accounts for variable considerations like, volume discounts,

rebates and pricing incentives to customers as reduction of revenue on a systematic and rational basis over the period of the contract. The Company estimates an amount of such variable consideration using expected value method or the single most likely amount in a range of possible consideration depending on which method better predicts the amount of consideration to which we may be entitled.

(ii) Other income

A. Interest income is accrued on a time basis by reference to the principal outstanding and the effective interest rate.

B. Other items of income are accounted as and when the right to receive such income arises and it is probable that the economic benefits will flow to the company and the amount of income can be measured reliably

(h) Foreign currency translation:

(i) The financial statements are presented in Indian rupee (INR), which is functional and presentation currency.

(ii) Transactions and balances:

Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in Statement of Profit and Loss.

Foreign exchange differences regarded as an adjustment to borrowing costs are presented in the Statement of Profit and Loss, within finance costs. All other foreign exchange gains and losses are presented in the Statement of Profit and Loss on a net basis within other gains/ (losses).

(i) Segment reporting

An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company''s other components, and for which discrete financial information is available. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (''CODM'').

The Company''s Board has identified the CODM who is responsible for financial decision making and assessing performance. The Company has a single operating segment as the operating results of the Company are reviewed on an overall basis by the CODM.

(j) Exceptional items:

An item of income or expense which by its size, type or incidence requires disclosure in order to improve an understanding of the performance of the company is treated as an exceptional item and the same is disclosed in the notes to accounts.

(k) Property, plant and equipment and capital work-in- progress:

Freehold land is carried at historical cost. All other items of property, plant and equipment are stated at historical cost less depreciation and impairment, if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Cost is inclusive of inward freight, net of tax/ duty credits availed, if any, and incidental expenses related to acquisition or construction. All upgradation / enhancements are charged off as revenue expenditure unless they bring similar significant additional benefits. An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of asset.

Subsequent costs are included in the asset''s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to Statement of Profit or Loss during the reporting period in which they are incurred.

Land acquired on lease for period exceeding 90 years is recognized as leasehold land at the cost, at the time of lease commencement. Any initial direct cost related to acquiring leasehold land (including expenses incurred to bring the

land into use) are capitalized and included in the cost of asset. The policy is based on the understanding that leasehold land is generally considered to have an extended economic life and does not experience a significant decline in value over the lease terms. Leasehold land will not be subject to depreciation

Projects under which tangible property, plant and equipment are not yet ready for their intended use are carried at cost, comprising of direct cost, related incidental expenses and attributable interest in case of qualifying assets.

Any excess of net sale proceeds of items produced over the cost of testing, if any, is deducted from the directly attributable costs considered as part of cost of an item of property, plant, and equipment.

Machinery spares which can be used only in connection with an item of property, plant and equipment and whose use is expected to be irregular are capitalised and depreciated over the useful life of the principal item of the relevant assets.

Capital work-in-progress:

Projects under which tangible Property, Plant & Equipment are not yet ready for their intended use are carried at cost, comprising direct cost, net of tax/duty credits availed, if any, related incidental expenses and attributable interest, in case of qualifying assets.

Depreciation methods, estimated useful lives and residual value:

Depreciation is systematically allocated over the useful life of the asset as specified in Schedule II of the Act. Depreciation on property, plant and equipment added/disposed of during the year is provided on pro-rata basis with reference to the date of addition/disposal. Freehold land is not depreciated.

(l) Intangible assets

Intangible assets are recognised when it is probable that the future economic benefits that are attributable to the asset will flow to the enterprise and the cost of the asset can be measured reliably. Intangible assets are stated at original cost net of tax/duty credits availed, if any, less accumulated amortisation and cumulative impairment. Administrative and other general overhead expenses that are specifically attributable to acquisition of intangible assets are allocated and capitalised as a part of the

Research and development expenditure on new products:

Expenditure on research is expensed under respective heads of account in the period in which it is incurred.

Development expenditure on new products is capitalised as intangible asset, if all of the following can be demonstrated:

A. the technical feasibility of completing the intangible asset so that it will be available for use or sale;

B. the company has intention to complete the

intangible asset and use or sell it;

C. the company has ability to use or sell the intangible asset;

D. the manner in which the probable future economic benefits will be generated including the existence of a market for output of the intangible asset or intangible asset itself or if it is to be used internally, the usefulness of intangible assets;

E. the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and

F. the company has ability to reliably measure the expenditure attributable to the intangible asset during its development.

Development expenditure that does not meet the above criteria is expensed in the period in which it is incurred. Intangible assets not ready for the intended use on the date of the Balance Sheet are disclosed as "intangible assets under development". Intangible assets are amortized on straight line basis over the estimated useful life. The method of amortization and useful life are reviewed at the end of each accounting year with the effect of any changes in the estimate being accounted for on a prospective basis. Amortization on impaired assets is provided by adjusting the amortization charge in the remaining periods so as to allocate the asset''s revised carrying amount over its remaining useful life.

(m) Impairment of assets:

At each balance sheet date, the Company reviews the carrying values of its property,

plant and equipment and intangible assets to determine whether there is any indication that the carrying value of those assets may not be recoverable through continuing use. If any such indication exists, the recoverable amount of the asset is reviewed in order to determine the extent of impairment loss (if any). Where the assets do not generate cash flows that are independent from other assets, the Company estimates the recoverable amount of the cash generating unit to which the asset belongs.

Recoverable amount is the highest of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pretax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. An impairment loss is recognised in the statement of profit and loss as and when the carrying value of an asset exceeds its recoverable amount.

Where an impairment loss subsequently reverses, the carrying value of the asset (or cash generating unit) is increased to the revised estimate of its recoverable amount so that the increased carrying value does not exceed the carrying value that would have been determined had no impairment loss been recognised for the asset (or cash generating unit) in prior years.

(n) Employee benefits:

(i) Short-term obligations:

Liabilities for wages and salaries, including non- monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees'' services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the Balance Sheet.

(ii) Other long-term employee benefit obligations:

The liabilities for earned leave and sick leave are not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service. They are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. The benefits are discounted using the market yields at the end of the reporting period that have terms approximating to the terms of the related obligation. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in profit or loss.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

(iii) Post-employment obligations:

Defined contribution plans: The Company''s contribution to provident fund are considered as defined contribution plans and are charged as an expense to the Statement of Profit and Loss based on the amount of contribution required to be made and when services are rendered by the employees.

Defined benefit plans: For defined benefit plans in the form of gratuity fund, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised in the Other Comprehensive Income in the period in which they occur. Past service cost is recognised immediately to the extent that the benefits are already vested and otherwise is amortised on a straight-line basis over the average period until the benefits become vested. The retirement benefit obligation recognised in the Balance Sheet represents the present value of the defined benefit obligation as adjusted for unrecognised past service cost, as reduced by fair value of plan assets (being the funded portion).

The Company operates a defined benefit gratuity plan, which requires contributions to be made to a separately administered fund managed by an insurance company.

(o) Lease

The Company assesses whether a contract

contains a lease, at inception of a contract.

A contract is, or contains, a lease if the

contract conveys the right to control the use

of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:

(i) the contract involves the use of an identified asset.

(ii) the Company has substantially all of the economic benefits from use of the asset through the period of the lease, and

(iii) the Company has the right to direct the use of the asset.

At the date of commencement of the lease, the Company recognizes a right-of-use asset and a corresponding lease liability for all lease arrangements in which it is a lessee, except for leases with a term of twelve months or less (short-term leases) and low value leases. For these short-term and low value leases, the Company recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease incentives. They are subsequently measured at cost less accumulated depreciation and impairment losses.

Right-of-use assets are depreciated on a straight-line basis over the lease term. Right of use assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e., the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets.

The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, using the incremental borrowing rates in the country of domicile of these leases. Lease liabilities are remeasured with a corresponding adjustment to the related right of use asset if the Company changes its assessment if whether it will exercise

an extension or a termination option.

Lease liability and ROU asset have been separately presented in the Balance Sheet and lease payments have been classified as financing cash flows.

(p) Financial instruments - initial recognition, subsequent measurement and impairment:

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

A. Investments and other financial assets

(i) Classification:

The Company classifies its financial assets in the following measurement categories:

- those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and

- those measured at amortised cost.

The classification depends on the company''s business model for managing the financial assets and the contractual terms of the cash flows.

For assets measured at fair value, gains and losses will either be recorded in the statement of profit or loss or other comprehensive income.

The classification criteria of the Company for debt instruments are provided as under:

Debt instruments:

Depending upon the business model of the Company, debt instruments can be classified under following categories:

- Debt instruments measured at amortised cost.

- Debt instruments measured at fair value through other comprehensive income.

- Debt instruments measured at fair value through profit or loss.

The Company reclassifies debt instruments when and only when its business model for managing those assets changes.

(ii) Measurement:

At initial recognition, the Company measures a financial asset at its fair value plus, in the

case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in the statement of profit or loss.

Debt instruments:

Subsequent measurement of debt instruments depends on the Company''s business model for managing the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Company classifies its debt instruments:

Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in the statement of profit or loss when the asset is derecognised or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.

Fair value through other comprehensive income: Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets'' cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognised in profit and loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/ (losses). Interest income from these financial assets is included in other income using the effective interest rate method.

Fair value through profit or loss: Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss

and is not part of a hedging relationship is recognised in the statement of profit or loss and presented net in the statement of profit and loss within other gains/(losses) in the period in which it arises. Interest income from these financial assets is included in other income.

(iii) Impairment of financial assets:

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 36 details how the Company determines whether there has been a significant increase in credit risk.

For trade receivables only, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

Expected credit losses are measured through a loss allowance at an amount equal to the following:

(a) the 12-months expected credit losses (expected credit losses that result from default events on financial instrument that are possible within 12 months after reporting date); or

(b) Full lifetime expected credit losses (expected credit losses that result from those default events on the financial instrument).

The Company follows ''simplified approach'' for recognition of impairment loss allowance on trade receivable. Under the simplified approach, the Company does not track changes in credit risk. Rather, it recognizes impairment loss allowance based on lifetime ECLs at each reporting date, right from initial recognition.

The Company uses a provision matrix to determine impairment loss allowance on the portfolio of trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivable and is adjusted for forward looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed.

Individual receivables which are known to be uncollectible are written off by reducing the carrying amount of trade receivable and the amount of the loss is recognised in the Statement of Profit and Loss within other expenses.

Subsequent recoveries of amounts previously written off are credited to other income.

(iv) Derecognition of financial assets:

A financial asset is derecognised only when:

- the Company has transferred the rights to receive cash flows from the financial asset or

- retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual obligation to pay the cash flows to one or more recipients.

Where the Company has transferred an asset, the Company evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is derecognised. Where the Company has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognised.

Where the Company has neither transferred a financial asset nor retains substantially all risks and rewards of ownership of the financial asset, the financial asset is derecognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.

B. Financial Liabilities:

(a) Classification:

The Company classifies its financial liabilities in the following measurement categories:

- Financial liabilities measured at fair value through profit or loss.

- Financial liabilities measured at amortized cost.

(b) Measurement:

The measurement of financial liabilities depends on their classification, as described below:

Financial liabilities measured at fair value through profit or loss:

Financial liabilities at fair value through profit or loss include financial liabilities held for trading. At initial recognition, such financial liabilities are recognised at fair value.

Financial liabilities at fair value through profit or loss are, at each reporting date, measured at fair value with all the changes recognized in the Statement of Profit and Loss.

Financial liabilities measured at Amortized Cost:

At initial recognition, all financial liabilities other than fair valued through profit and loss are recognised initially at fair value less transaction costs that are attributable to the issue of financial liability. Transaction costs of financial liability carried at fair value through profit or loss is expensed in the statement of profit or loss.

After initial recognition, financial liabilities are subsequently measured at amortised cost using the effective interest method. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the statement of profit or loss over the period of the financial liabilities 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.

(c) De-recognition of financial liability:

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in the statement of profit or loss as other income or finance costs.

(d) Compound financial instruments:

Compound financial instruments issued by the company which can be converted into fixed number of equity shares at the option of the holders irrespective of changes in the fair value of the instrument are accounted by separately recognising the liability and the equity components. The liability component is initially recognised at the fair value of a comparable liability that does not have an equity conversion option. The equity component is initially recognised at the difference between the fair value of the compound financial instrument as a whole and the fair value of the liability component. The directly attributable transaction costs are allocated to the liability and the equity components in proportion to their initial carrying amounts.

Subsequent to initial recognition, the liability component of the compound financial instrument is measured at amortised cost using the effective interest method. The equity component of a compound financial instrument is not remeasured subsequently.

(q) Offsetting financial instruments:

Financial assets and liabilities are offset, and the net amount is reported in the Balance Sheet where there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Company or the counterparty.

(r) Inventories:

Raw materials, consumable stores, stores and spares, and finished goods inventories are valued at the lower of cost (using weighted average method) and the net realisable value after providing for obsolescence and other losses, where considered necessary. Cost includes cost of purchase, all charges in bringing the goods to the point of sale, including indirect levies, net of recoveries, if any, transit insurance and receiving charges. Finished goods include appropriate proportion of overheads and, where applicable. Cost of inventories also includes all other costs incurred in bringing the inventories to their present location and condition.

Raw materials and stores are considered to be realisable at cost if the finished products in which they will be used, are expected to be sold at or above cost.

Assessment of net realisable value is made in each subsequent period and when the circumstances that previously caused inventories to be written-down below cost no longer exist or when there is clear evidence of an increase in net realisable value because of changed economic circumstances, the writedown, if any, in the past period is reversed to the extent of the original amount written-down so that the resultant carrying amount is the lower of the cost and the revised net realisable value.

(s) Cash and cash equivalents:

Cash and bank balances include fixed deposits, margin money deposits, earmarked balances with banks and other bank balances which have restrictions on repatriation. Short-term and liquid investments being subject to more than insignificant risk of change in value, are not included as part of cash and cash equivalents.

(t) Securities premium account:

Securities premium includes the difference between the face value of the shares and the consideration received in respect of shares issued.

The issue expenses of securities which qualify as equity instruments are written off against securities premium account, if and when such expenses are incurred, and as per the decision of the management.

(u) Borrowing costs:

General and specific borrowing costs (includes interest expense calculated using the effective interest method, other costs and expenses in relation to the borrowing) that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in profit or loss in the period in which these are incurred.

(v) Cash Flow Statement:

For the purpose of presentation in the Statement of Cash Flows, cash and cash equivalents includes cash on hand, other short- term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a noncash nature, any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

Short term borrowings, repayments and advances having maturity of three months or less, are shown as net in cash flow statement.

(w) Income tax:

The income tax expense for the period is the tax payable on the current period''s taxable income based on the applicable income tax rate for each year adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it is probable that future

taxable amounts will be available to utilize those temporary differences and losses. Minimum Alternate Tax (MAT) is not recognized as a deferred tax asset as the company is not liable for MAT tax.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

The carrying value of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Current and deferred tax is recognised in Statement of Profit and Loss, except to the extent that it relates to items recognised in Other Comprehensive Income. In such case, the tax is also recognised in Other Comprehensive Income.

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Mar 31, 2023

SIGNIFICANT ACCOUNTING POLICY

The Board of Directors has allotted 33,48,125 Share Warrants on March 31, 2023 at a price of '' 345/- per warrant aggregating
to '' 11,551.03 Lakhs convertible into 1 equity share per warrant subject to terms and conditions of the issue. The company has
received 25% of the total consideration on allotment of the Share Warrants as per the terms and conditions of the issue aggregating
to '' 2,887.76 Lakhs. Further, the Board has also allotted 7,500 Share warrants on the same price as above aggregating to '' 25.86
Lakhs on April 6, 2023 out of which 25% of the total consideration has been received aggregating to '' 6.47 Lakhs. The Balance
75% of the consideration aggregating to '' 8,682.65 Lakhs on these warrants are payable at any time but not after 18 months
from the date of allotment of warrants i.e. March 31, 2023 and April 6, 2023 on the exercise of the option by the warrant holders.

11.3 Nature and purpose of creation and utilisation of reserves

11.3.1 Securities Premium: Securities premium is created on excess amount received over and above the face value on issue of the
shares and securities. The securities premium can be utilised in accordance with the provisions of Section 52 of the Companies
Act 2013. These include issue of bonus shares and writing of expenses incurred such as commission etc. on issue of shares/
securities.

11.3.2 Capital Redemption Reserve(CRR): The Companies Act, 2013 requires that when a Company purchases its own shares out of
free reserves or securities premium account, a sum equal to the nominal value of the shares so purchased shall be transferred to
a capital redemption reserve. The reserve is utilised in accordance with the provisions of Section 69 of the Companies Act, 2013.

11.3.3 Retained Earnings: Retained earnings are the profits (including Other Comprehensive income) that the company has earned
till date, less any transfer to general reserve, dividends or other distribution or the distributions paid to the shareholders.

12.2 The Company had issued in FY 2015-16, Zero percent (0)% Redeemable Non Cumulative Preference Shares (NCPS) with
an option to the Board to redeem these NCPSs at a premium of 5 % at any time within a period of 5 years or at a premium of
10% within a period of 10 years or at a premium of 20% if the shares are redeemed after a period of 10 years. As the tenure of
Preference Shares was about to complete 5 years the Board initiated the process for KYC and redemption of the said preference
shares with the consent of such preference shareholders.

On non receipt of KYC from one of the preference shareholder, a board meeting was called up during 2021-22 on 25^th October,
2021 and instead of redemption, the company decided and passed a Board resolution for change in terms of redemption
i.e. no premium on redemption with a maturity period at the end of 20 years (against earlier period of 5 years or 10 years or
beyond 10 years as the case may be) and the same was approved in the adjourned preference shareholders'' meeting held on
26^th November, 2021 with one shareholder present. The necessary filings for the same is complied with the Ministry of Corporate
Affairs.

12.3 Out of the above said Preference share on the request of one of the shareholders (Mr. Sailesh Gupta) the Company in its board
meeting held on August 10, 2022 has redeemed 3,66,200 0% Series A Redeemable Non cumulative Preference Shares of
'' 10/- each at a aggregate value of '' 36,62,000 out of profits of the Company in compliance with the provisions of Section 55
and all other applicable provisions, if any, of the Companies Act, 2013, and the rules made thereunder (including any statutory
modification(s) or re-enactment(s) thereof for the time being in force),

12.4 For terms and conditions for Compound financial instruments, Refer note no. 11.1