Notes to Accounts of High Energy Batteries (India) Ltd.
Mar 31, 2023
Capital Redemption Reserve
This represents the Reserves created on redemption of preference shares and can be utilized for issue of Bonus shares.
This represents the premium collected on issue of Equity shares and can be utilized for the purposes stated under Section- 52 of the Company''s Act 2013.
This Reserve is created from time to time by transferring profits from the retained earnings and this being a free reserve enhances the net worth of the company and is available for distribution as Bonus share / dividend.
a) Paripassu first charge on the entire current assets of the company, namely stocks of Raw Materials, semi finished goods, and Finished Goods, Stores and Spares not relating to Plant and Machinery (Consumable stores and spares) including book debts and mortgage and hypothecation over the land and building, plant and machinery and other immovable fixed assets of the company.
b) Lien on Fixed Deposits (including interest) aggregating to '' 53.39 Lakhs (Previous year '' 101.42 Lakhs)
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33. Contingent Liabilities and Commitments |
'' in lakhs |
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Particulars |
Year ended 31.03.2023 |
Year ended 31.03.2022 |
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(a) Contingent Liabilities |
Nil |
Nil |
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(b) Commitments |
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(i) Estimated amount of contracts remaining to be executed on capital accounts not provided for |
3.10 |
22.33 |
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(ii) Silver supplied by Government secured by Bank Guarantee and is not included in Inventories |
59.53 |
239.20 |
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(iii) Assets controlled by customers in possession of the Company |
431.65 |
368.88 |
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*In view of the nature of business, commitments for purchase of materials, business commitments and hence not disclosed. |
etc., are considered as normal |
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1. The fair value of quoted investment in quoted equity shares measured at quoted price on the reporting date.
2. In case of trade receivables, cash and cash equivalents, trade payables, short term borrowings and other financial assets and liabilities it is assessed that the fair values approximate their carrying amounts largely due to the short-term maturities of these instruments.
3. The fair values of the financial assets and financial liabilities included above have been determined in accordance with generally accepted pricing models based on a discounted cash flow analysis, with the most significant inputs being the discount rate that reflects the credit risk of counterparties.
4. Investment in equity shares are held as promoter and not held for disposal and are therefore classified as Fair value through Other Comprehensive Income.
The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.
The company''s financial liabilities comprise mainly of working capital borrowings from banks, bills payable, trade payables and other payables. The company''s financial asset comprises mainly cash equivalents, other balances with banks, trade receivables, other receivables and investments.
The Company has financial risk exposure in the form of market risk, credit risk and liquidity risk. The risk management policies of the Company are monitored by the Board of Directors. The present disclosure made by the Company summarizes the exposure to the financial risks.
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market price comprises two types of risks viz., Currency risk and other price risk. The financial instruments affected by market risk include rupee term loan and loans & advance.
a) Interest Rate Risk exposure
The Company is having Working Capital facility limit of '' 3000 lakhs with Banks which including Bill discounting also. The interest rate is @ 10.95% UCO Bank & 10.70% Punjab National Bank depending upon the change in MCLR Rate.
Interest Rate Sensitivity analysis
The Company considering the economic environment in which it operates has determined the interest rate sensitivity analysis (interest exposure at the end of the reporting period). The interest rates for the Company are floating rate and hence the analysis in the case of Long Term Loan from Banks is prepared by re-computing the Repayment schedule for the rest of the repayment period and in the case of working capital Limit is prepared assuming the amount of the borrowings outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis points /- 0.50% fluctuation in interest rate is used for disclosing the sensitivity analysis.
The interest rate sensitivity analysis is done holding on the assumption that all other variables remain constant.
The increase/decrease in interest expense is chiefly attributable to the Company''s exposure to interest rates on its variable rate of borrowings.
b) Foreign currency risk exposure
The Company imports Silver Bullion, Silver Foil, Magnesium Sheets, other Raw materials and Stores and spares for which payables are denominated in foreign currency. The Company is exposed to
foreign currency risk on these transactions. Since the company imports materials mostly on advance payment basis, the company does not perceive major risk and accordingly they are not hedged.
In respect of batteries, exports are made against advances received or against confirmed LCs of usance period not exceeding 90 days.
The credit risk refers to risk that counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises primarily from financial assets such as trade receivables, bank balances, other balances with banks and other receivables.
The credit risk arising from the exposure of investing in other balances with banks and bank balances is limited and there is no collateral held against these because the counterparties are public sector banks.
The Company sells its products of Aerospace, Naval and Power System Batteries to Defence Customers where the payment terms are definite. From the Defense Organisations and Government of India, payments are all received as per the terms of the contracts. The risk is restricted to the Liquidated damages clause for delayed supplies as per the contract terms and there is no irrevocable credit loss risk.
Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or other financial asset. Liquidity risk may result from an inability to sell a financial asset quickly to meet obligations when due. The Company''s exposure to liquidity risk arises primarily from mismatches of maturities of financial assets and liabilities.
The Company manages the liquidity risk by -
(i) maintaining adequate and sufficient cash and cash equivalents including and
(ii) Making available the funds from realizing timely maturities of financial assets to meet the obligations when due.
The management monitors rolling forecast of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash flows. Also, the company manages the liquidity risk by projecting cash flows considering the level of liquid assets necessary to meet the obligations by matching the maturity profiles of financial assets and financial liabilities and monitoring balance sheet liquidity ratios. Further, liquidity risk management involves matching the maturity profiles of financial assets and financial liabilities.
(i) Utilisation of borrowed funds and share Premium through intermediaries or for benefit of third party beneficiaries:
a) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company, its subsidiary, associate to or in any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company, its subsidiariary, associate (Ultimate Beneficiaries).
b) The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company , its subsidiary, associate, shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company , its subsidiariy, associate (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(ii) Borrowings secured against current assets
The Quarterly returns or statements of current assets filed by the Company with Banks in agreement with the books of account.
(i) Defined Contribution Plans:
The Company makes Provident Fund and Superannuation Fund contributions which are defined contribution plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised '' 44.20 Lakhs (Year ended March 31, 2022 '' 39.20 Lakhs) for Provident Fund contributions and '' 3.60 Lakhs (Year ended March 31, 2022''3.60 Lakhs) for Superannuation Fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.
(ii) Defined Benefit Plans:Gratuity (Funded)
In respect of Gratuity, Actuarial valuation of Plan Assets and the defined benefit obligation as on the reporting date carried out by an Actuary. The present value of the defined benefit obligation and the related current service cost and past service cost, were measured using the projected unit cost method. The following table sets forth the status of the Gratuity Plan and the benefit Scheme of the Company and the amount recognised in the Balance Sheet and Statement of Profit and Loss. The Company provides the gratuity benefit through annual contributions to the funds managed by the Life Insurance Corporation of India.
The Company is exposed to various risks in providing the above gratuity benefit which are as follows:
Interest Rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing above benefit and will thus result in an increase in the value of the liability (as shown in financial statements).
Investment Risk : The probability or likelihood of occurrence of losses relative to the expected return on any particular investment.
Salary Escalation Risk : The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future, based on past experience. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s liability.
Demographic Risk : The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to the risk of actual experience turning out adverse compared to the assumptions.
The Company has purchased insurance policy, which is basically a year-on-year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The insurance Company, as part of the policy rules, makes payment of all gratuity outgoes happening during the year (subject to sufficiency of funds under the policy). The policy, thus, mitigates the liquidity risk. However, being a cash accumulation plan, the duration of assets is shorter compared to the duration of liabilities. Thus, the Company is exposed to movement in interest rate (in particular, the significant fall in interest rates, which should result in an increase in liability without corresponding increase in the asset).
Sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.
Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.
The Company''s best estimate of the contribution expected to be paid to the plan during the next year is ''10.00 Lakhs ( Previous year '' 85.00 Lakh).
Factors used to identify Reporting Segments:
The company has the following reportable Operating segments, which are its reporting segments. These segments offer different types of batteries to different types of customers and are managed separately because they require different technology and production process. Operating segment disclosures are consistent with the information provided to and reviewed by the Chief Operating Decision Maker.
F. Revenue from External Customers:
Two customers contribute to more than 10% of the revenue of Aerospace, Naval and Power Systems Segment.
Lead Acid Batteries Division operation continues to remain suspended due to unremunarative prices. There being no sales, amount relating to income are not given.
43. Authorisation for issue of Financials
The financial statements have been authorised for issue by the Board of Directors at the Board Meeting held on 29th April, 2023.
Mar 31, 2018
d. Capita/ Management
The Company follows conservative capital management with the objective of maximising shareholders'' value. For the purpose of the company capital management, capital includes issue capital and ail other equity reserves attributable to the shareholders of the company. The Company has been funding its growth and working capital requirements through a balanced approach of intern at accruals and external debt from the banks and long term loans from companies. The Company monitors the capital structure on The basis of net debt to equity ratio and maturity profile of the eve rail debt component of the company.
General receive is created from time to time by way of transfer of profits from renamed earnings for appropriation purposes. General reserve is treated by a transfer from one component of equity to anointer and is no! an item of other comprehensive income. I! is a free reserve creates 10 enhance the Met wonk of the company.
The companyâs financial liabilities comprise mainly of viz., working capital borrowings from banks, bills payable, inter corporate loans from companies, trade payables and other payables. The company''s financial asset comprises mainly cash equivalents, other balances with banks, trade receivables. other receivables and investments.
The Company has financial risk exposure in the form of viz.. market risk, credit risk and liquidity risk. The risk management policies of the Company are monitored by the Board of Directors. The present disclosure made by the Company summarizes the exposure to the financial risks.
1) Market Risk:
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market price comprises three types of risk: Currency risk and other price risk. The financial instruments affected by market risk include rupee term loan and loans & advance.
a) Interest Rate Risk exposure
The Company does not have any Long Term Loans from Financial Institutions. The Company is having Working Capital facility limit of fish. 2700 lakhs facility with Banks. The company also discounts its receivables to meet its short term fund requirements. The interest rate Is @ 11,25% depending upon the change in MCRL Rate. Interest on loans from companies is at a fixed rate of 12% and hence there is no interest risk on the loan.
Interest Rate Sensitivity analysis
The Company considering the economic environment in which it operates has determined the interest rate sensitivity analysis (interest exposure at the end to the reporting period). The interest rates for the Company are floating rate and hence the analysis is prepared assuming the amount of the borrowings outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis points 0-50% fluctuation in interest rate is used for disclosing the sensitivity analysis.
The interest rate sensitivity analysis is done holding on the assumption that all other variables remaining constant.
The increase/decrease in interest expense is chiefly attributable to the Company s exposure to interest rates on is variable rate of borrowings.
b) Foreign currency risk exposure
The Company imports Silver Bullion, Silver Foil, Magnesium Sheets, other raw materials and Stores and spares for which payables are denominated in foreign currency. The Company is exposed to foreign currency risk on these transactions. The Company is having outstanding of USS 3.07 is equivalent to Indian Fls.20Q.49 as on 31.03,2018.
In respect of batteries, exports are made against advances received or against confirmed LCs of since period not exceeding 30 days. Hence, the Company is not exposed to any significant Foreign currency risk in respect of its exports.
1) Credit Risk
The credit risk refers 1o risk that counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises primarily from financial assets such as trade receivables, bank balances, other balances with banks other receivables.
The credit risk arising from the exposure of investing in other balances with banks and bank balances is limited and there is no collateral held against these because the counterparties are public sector banks.
The Company sells its products of Aerospace Naval and Power System Batteries to Defence Customers where the payment terms are definite. The Defines Organisation of Government of India and payments are all received as per the terms of the contracts. The risk is restricted to the Liquidated damages clause for late supplies as per the contract terms and there is no irrevocable credit loss risk.
The Lead Acid Batteries Division is sells its products through Private Labelling arrangements. Customer pays 70% of its order value through opening LC for procuring raw material s. Balance 30% payments received alter 90 days of credit and it is also protected to the extent of raw materials received.
Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities that a:e settled by delivering cash or another financial asset. Liquidity risk may result from an inability to sell a financial asset quickly to meet obligations when due. The Company''s exposure to liquidity risk arises primarily from mismatches of maturities of financial assets and liabilities.
The Company manages the liquidity risk by -
[i] maintaining adequate and sufficient cash and cash equivalents including investments in mutual funds, and
(ii) making available the funds from realizing timely maturities of financial assets to meet the obligations when due.
The management monitors rolling forecast of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash flows. Also, the company manages the liquidity risk by projecting cash flows considering the level of liquid assets necessary to meet the obligations by matching the maturity profiles of financial assets and financial liabilities and monitoring balance sheet liquidity ratios. Further, liquidity risk management involves matching the maturity profiles of financial assets and financial liabilities.
36; First Time Adoption of ind A5
For all periods up to and including the year ended 31" March, 2017, the Company had prepared its financial statements In accordance with the accounting standards notified under Section 133 of The Companies Act, 2013, read together with Rule 7 of the Companies {Accounts) Rules, 2014 (''''Previous I GAAP"}, This note explains the principal adjustments made by the Company in restating its financial statements prepared under Previous GAAP for the following:
a) Balance Sheet as at 1stApril. 2016 (Transition date);
b) Balance Sheet as at 31st March, 2017,
c) Statement of Profit and Loss for the year ended 31" March, 2017; and
d) Statement of Cash flows for the year ended 31=f March, 2017.
Exemptions availed:
Ind AS 101 First time adoption of Indian Accounting Standards, allows first-time adopters, exemptions from the retrospective application and exemption from application oi certain requirements of other Ind AS. The Company has availed the following exemption as per Ind AS 101:
t. The Company has elected to consider the carrying value of all its items of property, plant and equipment recognized in the financial statements prepared under Previous I GAAP and use the same as deemed cost in the opening Ind AS Balance Sheet except land, far which fair value as on date of transition is taken as deemed cost.
ii. The Company elected not to apply "Ind AS 103 - Business Combinations" retrospectively for past business combinations.
Foot Notes for First Time adoption of Ind AS:
a) Materiality
The company has applied The standards only to items / transactions which are material,
b) Non-Current Investments:
In the financial statements prepared under Previous GAAP, Nan-current Investments of the Company were measured at cost less provision for diminution, Ind AS requires investments to be recognized at Fair Value. Under Ind AS, the Company has recognised such investments at Fair Value through Other Comprehensive Income (FVTOCI) through an irrevocable option.
On the date of transition to Ind AS, the difference between the fair value of Non-Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous IGAAP, has resulted In an increase in the carrying amount of these investments by Rs.23.73 lakhs which has been recognized as Effect of Measuring Investments at fair value - under Other Comprehensive Income (OCI),
On 31s1 March, 2017, the difference between the fair value of Non-Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous IGAAP, has resulted in an increase in the carrying amount of these investments by Rs.e0.04 lakhs which has been recognized as Effect ot Measuring Investments at fair value - under Other Comprehensive Income (OC!}.
The above has resulted in increase in equity by Rs.23.7B Lakhs as at the date of transition to ind AS and by Rs.56.26 Lakhs as at 31 * March, 2017.
c) Property, Plant and Equipment:
The company has adopted the fair value of find Rs. 1987.82 Lakhs as on the transition date as deemed cost, with title impact of Rs,1963.36 lakhs. In accordance with Ind AS the same is recognized directly under retained earnings.
The consequent deferred tax impact is Rs.382.13 lakhs is also adjusted to retained earnings with other adjustment for deferred tax.
Out of The impairment provision on Trade Receivables of Rs. 279.18 Lakhs, Rs. 100.98 Lakhs was provided under the Previous IGAAP and consequently the provisions recognized in the financial statements prepared under IGAAP for the year ended 31st March, 2017 is reversed and the restatement of Inter Corporate Loans at Amortized Cost using EIR method has resulted in gain of Rs.75.75 Lakhs, recognized in retained earnings as on 31st March. 2017. ''
e) Deferred Tax
In the financial statements prepared under the previous GAAP deterred tax was accounted as per Income Approach, which required creation of deferred tax asset/liability on timing differences between taxable profit and accounting profit. Under Ind AS, deferred tax is accounted as per Balance Sheet approach, which requires creation of deferred tax asset/ liability on temporary differences between the carrying amount of an asset liability in the Salience Sheet and its corresponding tax base.
The transitional adjustments have led to temporary differences and creation of deferred tax the rein.
The above changes have resulted in creation of deferred lay liabilities amounting to Rs.250.79 Lakhs as at the date of transition to Ind AS.
The applicable tax rate for the company has come down to 25.75% from 30.9% from FY 2017-18. As the applicable tax rate got enacted on 31.03.2017, the deferred tax asset liabilities were reassessed at the new rate and the net deferred tax asset written off Lakhs is adjusted in the comparative Financial period FY 2016-17,
f) Revenue from Sale of Products:
Under the previous GAAP, Revenue from sale of products was presented net of excise duty while under ind AS, excise duty is presented separately on the face of Profit and Loss. Hence the revenue amount as on 31st March, 2017 is increased by Rs.82.93 Lakhs and shown as expense in the Statement of Profit and Loss.
g) Re-measurement of Defined Benefit Plans:
In the financial statements prepared under Previous IGAAP. re-measurement benefit of Defined Plans (Gratuity), arising primarily due to change in actuarial assumptions was recognized as employee benefit expense in the Statement of Profit and Loss. Under Ind AS, such re-measurement benefit relating to defined benefit plans is recognized in OCI as per the requirements of ind AS 19 - Employee benefits. Consequently, the related tax effect of the same has also been recognized in OCI.
For the year ended 31st March, 201 £ re-measurement of gratuity liability resulted in a net loss of Rs.4.52 lakhs which has now been removed from employee benefits expense in the Statement of Profit and Loss and recognized separately in OCI, This has resulted in decrease in employee benefits expense by Rs.4.52 lakhs and the loss recognized in OCI is Rs.4.52 lakhs for the year ended 31st March, 2017. Consequently, tax effect of the same amounting to Rs. 1.16 lakhs is also recognized separately in OCI.
The above changes do not affect Equity as at date of transition to Ind AS and as at 31st March, 2017.
h) Effect of Ind AS adoption of Statement of Cash Flow:
According to the provisions of Ind AS 7, Interest received which was earlier grouped under Financing Activity has been grouped under Investing Activity.
41 Employee Benefits
(i) Defined Contribution Plans :
The Company makes Provident Fund and Superannuation Fund contributions which are defined contribution plans, for qualifying employees. Under the Schemes the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs 29.75 Lakhs (Year ended March 31. 2017 Rs 31,70 Lakhs) for Provident Fund contributions and Rs 12.96 Lakhs (Year ended March 31. 2017 Rs 4.00 Lakhs) for Superannuation Fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.
(ii) Defined Benefit Plans:
Gratuity (Funded)
In respect to Gratuity, the most recent actuarial valuation of the plan assets and in respect of Gratuity the present value of the defined benefit obligation were carried out by actuarial valuation . The present value of the defined benefit obligation and the related current since cost and past service cost, were measured using the projected unit cost method. The following table sets forth the status of the Gratuity Plan and the benefit Scheme of the Company and the amount recognised in the Balance Sheet and Statement of Profit and Loss. The Company provides the gratuity benefit and through annual continuations to the funds managed by the Life Insurance Corporation of India,
The Company is exposed to various risks in providing the above gratuity benefit and Leave which are as follows:
Interest Rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase In The ultimate cost of providing above benefit and will thus result in an increase in the value of the liability (as shown in financial statements).
Investment Risk :
The probability or likelihood of occurrence of losses relative to the expected return on any particular investment.
Salary Escalation Risk :
The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future, based on past experience. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s liability. Demographic Risk ;
The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to the risk of actual experience turning out adverse compared to the assumptions
The Company pays contributions to the insurer as statetermtried by them The insurance company has invested the plan assets in Government Securities, Debt Funds, Equity shares. Mutual Funds and Money Market instruments, The expected rate of return on plan assets based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligation. Significant actuarial assumptions for the determination of the defined benefit obligation are as discussed above.
Sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.
Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected un>t credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in The balance sheet.
The Company has purchased insurance policy, which is basically a year-on-year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The insurance Company, as part of the policy rules, makes payment of all gratuity outgoes happening during the year (subject to sufficiency of funds under the policy). The policy, thus, mitigates the liquidity risk. However, being a cash accumulation plan, the duration of assets is shorter compared to the duration of liabilities. Thus, the Company is exposed to movement in interest rate (in particular, the significant fall in interest rates, which should result in an increase in liability without corresponding increase in the asset)
The Company''s best estimate of the contribution expected to be paid to the plan during the next year is Rs,20.00 Lakhs ( Previous year 2017 Rs,20.00 Lakhs).
1.Segment Reporting
Factors used to identify Reporting Segments:
The company has the following reporting segments, which are its reporting segments. These segments offer different types of batteries to different types of customers and are managed separately because they require different technology and production process. Operating segment disclosures are consistent with the information provided to and reviewed by the Chief Operating Decision Maker.
Mar 31, 2017
Terms / rights attached to Equity Share : The Company has only one class of Equity share having a par value of Rs. 10/- per share. Each holder of Equity share is entitled to one vote per share.
Dividend (if any) proposed by the board of directors is subject to approval of the shareholders at the ensuing 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 after distribution of all preferential amounts in proportion to their share holding.
Working Capital borrowings from Banks are secured by :
a) Paripassu first charge on all stocks of Raw Materials, Finished Goods, Stock in Process, Stores, Spares, book debts and movable assets of the company.
b) Paripassu first charge on all immovable fixed assets of the company excepting those pertaining to Lead Acid Battery Facility.
c) Paripassu second charge on all movable and immovable fixed assets of the Lead Acid Battery Facility.
d) Lien on Fixed Deposits (including interest) aggregating to Rs.75.53 Lakhs.
Micro and Small Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 have been determined to the extent such parties have been identified on the basis of information available with the Company. There are no over dues to such parties, on account of Principal amount and / or Interest and accordingly no additional disclosures have been made.
1. Transfer to Deferred Tax is mainly on account of difference in charging depreciation prescribed under the Companies Act 2013, and allowable under the Income Tax Act, 1961 and on account of unabsorbed depreciation / business loss under Income Tax Act.
Based on firm orders on hand and expected improvements in the performance of the Company as a whole, in the view of the Management, the company will have adequate taxable income in future and there exists virtual certainty of the Deferred Tax Asset (DTA) getting realized.
2 Expenditure on Scientific Research includes salaries and allowances Rs.54.68 lakhs (Previous year Rs.74.27 lakhs) and materials is Nil (Previous year Nil)
3. In terms of development contract with a customer, assets and development expenditure of the value of Rs.191 lakhs has been incurred and equivalent amount received from the customer is netted against the same. The company is holding these assets as a bailee in terms of the development contract.
4. Movement in estimated Liability towards Warranty as per Accounting Standard 29 (AS 29)
5. Related Party disclosures, as required by Accounting Standard 18 (AS 18)
(i) Name of the transacting Related Party:
- Seshasayee Paper and Boards Limited (SPB)
- Esvi International (Engineers & Exporters) Limited
- Dr. G. A. Pathanjali, Managing Director
(ii) A description of the relationship between the parties:
Presumption of Significant influence
(iii) A description of the nature of the transactions and volume of the transaction, either as an amount or as an appropriate proportion:
6. The disclosure as required under Accounting Standard AS-17 âSegment Reportingâ;
a. The company has considered business segment as the primary segments for disclosure. The business segments are Aero Space, Naval, and Power System Batteries and Lead Acid Batteries. The above reportable segments have been identified based on the organization structure as well as differing risks and returns associated with the segments.
b. Segmental expenses and revenue wherever could not be identified to a particular segment has been treated as unallocated expenses and revenue.
c. Segment assets and segment liabilities represent assets and liabilities in respective segments. Investments, tax related assets and other assets and other liabilities that cannot be allocated to a segment on reasonable basis have been disclosed as âunallocableâ.
7. Employee Benefits
i) Defined Contribution Plans
Contribution of Rs.31.70 Lakhs to defined contribution plans is recognized as an expense and included in Employee Benefits (Note No. 24) in the Statement of profit and loss account. (Previous year Rs.34.45 Lakhs)
ii) Defined Benefit Plans
Disclosure for defined plans based on actuarial valuation as on 31.03.2017.
8 Disclosure as per Accounting Standard 19 - Leases
Operating Lease:
The Company has taken Office and Godown premises on operating lease and no substantial risk and reward incidental to ownership of the assets has been obtained. All lease agreements are cancellable at the option of the company.
9. Confirmation of balances are yet to be received/ reconciliation is pending in respect of certain Debtors/Creditors and advances from customers. Adjustment if any which may arise upon receipt of confirmation/ completion of reconciliation will be dealt with in the year of receipt of confirmation/completion of reconciliation.
10. Details of Specified Bank Notes (SBN) held and transacted during the period from 8th November, 2016 to 30th December 2016 as provided in the Table below :-
11. Previous year figures have been regrouped and rearranged wherever necessary, to confirm to current yearâs classification.
Mar 31, 2016
Terms / rights attached to Equity Share : The Company has only one class of Equity share having a par value of Rs, 10/- per share. Each holder of Equity share is entitled to one vote per share.
Dividend (if any) proposed by the board of directors is subject to approval of the shareholders at the ensuing 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 after distribution of all preferential amounts in proportion to their share holding.
*During the current year, company based on the approval from Board of directors transferred sums aggregating to '' 648 Lakhs from General reserve to Deficit in the statement of profit and Loss.
Working Capital borrowings from Banks are secured by :
a) Paripassu first charge on all stocks of Raw Materials, Finished Goods, Stock in Process, Stores, Spares, book debts and movable assets of the company.
b) Paripassu first charge on all immovable fixed assets of the company excepting those pertaining to Lead Acid Battery Facility.
c) Paripassu second charge on all movable and immovable fixed assets of the Lead Acid Battery Facility.
d) Lien on Fixed Deposits (including interest) aggregating to Rs, 70.27 Lakhs.
Micro and Small Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 have been determined to the extent such parties have been identified on the basis of information available with the Company. There are no over dues to such parties.
* No amount is due and outstanding to be credited to Investor Education and Protection Fund.
1. Transfer to Deferred Tax is mainly on account of difference in charging depreciation prescribed under the Companies Act 2013, and allowable under the Income Tax Act, 1961 and on account of unabsorbed depreciation / business loss under Income Tax Act.
Based on firm orders on hand and expected improvements in the performance of the Company as a whole, in the view of the Management, the company will have adequate taxable income in future and there exists virtual certainty of the Deferred Tax Asset (DTA) getting realized.
2. Expenditure on Scientific Research includes salaries and allowances Rs, 74.27 lakhs (Previous year Rs, 62.14 lakhs) and materials is Nil (Previous year Rs,1.02 lakhs)
3. In terms of development contract with a customer, assets and development expenditure of the value of Rs, 191 lakhs has been incurred and equivalent amount received from the customer is netted against the same. The company is holding these assets as a bailee in terms of the development contract.
4. Movement in estimated Liability towards Warranty as per Accounting Standard 29 (AS 29)
5. Exceptional Items:
a) During the current year the company has sold 280000 shares held in Ponni sugars Erode Limited and recognized profit on sale of such investments amounting to Rs, 503.84 lakhs. The profit on sale of investments is reflected under exceptional item.
b) Exceptional items includes obsolete inventories written off amounting to Rs, 160.76 lakhs and sales returns amounting to Rs, 78.45 lakhs.
34. Related Party disclosures, as required by Accounting Standard 18 (AS 18)
(i) Name of the transacting Related Party:
- Seshasayee Paper and Boards Limited (SPB)
- Esvi International (Engineers & Exporters) Limited
- Dr. G. A. Pathanjali, Managing Director
- Mr. T. R. Sivaraman, Director (Finance) Up to 13.08.2015
(ii) A description of the relationship between the parties:
Presumption of Significant influence
(iii) A description of the nature of the transactions and volume of the transaction, either as an amount or as an appropriate proportion:
7. The disclosure as required under Accounting Standard AS-17 âSegment Reportingâ;
a. The company has considered business segment as the primary segments for disclosure. The business segments are Aero Space, Naval, and Power System Batteries and Lead Acid Batteries. The above reportable segments have been identified based on the organization structure as well as differing risks and returns associated with the segments.
b. Segmental expenses and revenue wherever could not be identified to a particular segment has been treated as unallocated expenses and revenue.
c. Segment assets and segment liabilities represent assets and liabilities in respective segments. Investments, tax related assets and other assets and other liabilities that cannot be allocated to a segment on reasonable basis have been disclosed as âunallowableâ.
risk and reward incidental to ownership of the assets has been obtained. All lease agreements are cancellable at the option of the company.
8. On Consideration of prudence the company during the current year has reversed MAT Credit entitlement outstanding at the beginning of the year aggregating to Rs.31.68 lakhs, and is reflected under Tax expenses.
9. Confirmation of balances are yet to be received/ reconciliation is pending in respect of certain Debtors/Creditors and advances from customers. Adjustment if any which may arise upon receipt of confirmation/ completion of reconciliation will be dealt with in the year of receipt of confirmation/completion of reconciliation.
10. Previous year figures have been regrouped and rearranged wherever necessary, to confirm to current yearâs classification.
* Includes Fixed Deposits with Banks aggregating to Rs, 70.27 Lakhs (Previous year Rs, 68.84 Lakhs) given as security margin for certain Borrowings from Banks / Foreign Letter of Credit.
Mar 31, 2015
1 Contingent Liabilities and Commitments
Counter Guarantees and Commitments on Letters of Credit 971.03 894.53
Claims against the company not acknowledged as Debts 28.00 28.00
Estimated amount of contracts remaining to be executed
on capital accounts not provided for 2.40 -
Tamil Nadu VAT under dispute 84.65 84.65
Claims from Customers under dispute 0.38 0.38
2. Transfer to Deferred Tax is mainly on account of difference in
charging depreciation prescribed under the Companies Act 1956, and
allowable under the Income Tax Act, 1961 and on account of unabsorbed
depreciation / business loss under Income Tax Act.
Based on firm orders on hand and expected improvements in the
performance of the company as a whole, in the view of the Management,
the company will have adequate taxable income in future and there
exists virtual certainty of the Deferred Tax Asset (DTA) getting
realized.
3. Expenditure on Scientific Research includes salaries and allowances
Rs 61.12 Lakhs (Previous year Rs 60.33 Lakhs) and materials Rs.1.02 Lakhs
(Previous year Rs 19.85 Lakhs)
4. In terms of development contract with a customer, assets and
development expenditure of the value of Rs 191 Lakhs has been incurred
and equivalent amount received from the customer is netted against the
same. The company is holding these assets as a bailee in terms of the
development contract.
5. Movement in estimated liability towards Warranty as per Accounting
Standard 29 (AS 29)
6. Hitherto, depreciation was provided as per rates/methods specified
in Schedule XIV of the Companies Act, 1956.
The company has changed the method of providing depreciation from 1st
April 2014 as required by the Companies Act, 2013. Accordingly the
depreciation for the current year has been provided in accordance with
useful life specified in Schedule II thereof in respect of all assets
(other than Plant & Machinery relating to Lead Acid Battery Division).
In respect of Plant & Machinery relating to Lead Acid Battery Division,
depreciation is provided based on 20 years of useful life as assessed
by a Chartered Engineer.
Due to the above change in the method, depreciation for the current
year is higher by Rs.11.28 Lakhs.
Further, in respect of assets whose useful life at the beginning of the
year is NIL, their carrying value (Rs.16.57 Lakhs) net of deferred tax
(Rs 8.53 Lakhs) as on 1st April 2014, after retaining the residual
value, has been adjusted against retained earnings.
7. Profit on sale of land amounting to Rs 639.69 Lakhs has been
recognized pursuant to execution of sale agreement, possession handed
over and receipt of significant portion of sale consideration. The
execution and registration of sale deed has since been completed.
8. Related Party disclosures, as required by Accounting Standard 18
(AS 18)
(i) Name of the transacting Related Party:
- Seshasayee Paper and Boards Limited (SPB)
- Esvi International (Engineers & Exporters) Limitied
- Dr. G. A. Pathanjali, Managing Director
- Mr. T. R. Sivaraman, Director (Finance)
(ii) A description of the relationship between the parties:
Presumption of Significant influence
(iii) A description of the nature of the transactions and volume of the
transaction, either as an amount or as an appropriate proportion:
9. The disclosures as required under Accounting Standard 17 (AS 17)
"Segment Reporting"
a. The company has considered business segment as the primary segments
for disclosure. The business segments are Aerospace, Naval and Power
System Batteries and Lead Acid Batteries. The above reportable segments
have been identified based on the organisation structure as well as
differing risks and returns associated with the segments.
b. Segmental expenses and revenue wherever could not be identified to a
particular segment has been treated as unallocated expenses and
revenue.
c. Segment assets and segment liabilities represent assets and
liabilities in respective segments. Investments, tax related assets and
other assets and other liabilities that cannot be allocated to a
segment on reasonable basis have been disclosed as "unallocable".
10. Employee Benefits
i) Defined Contribution Plans
Contribution of Rs 39.23 Lakhs to defined contribution plans is
recognized as expense and included in Employee Benefits (Note No. 25)
in the profit and loss account. (Previous year Rs 33.09 Lakhs)
Mar 31, 2013
1. Transfer to Deferred Tax is mainly on account of difference in
charging depreciation prescribed under the Companies Act 1956, and
allowable under the Income Tax Act, 1961 and on account of unabsorbed
depreciation / business loss under Income Tax Act.
Based on firm orders on hand and expected improvements in the
performance of the company as a whole, in the opinion of the
Management, the company will have adequate taxable income in the future
and there exists virtual certainty of the Deferred Tax Asset (DTA)
getting realized.
2. Expenditure on Scientific Research includes salaries and
allowances Rs. 68.85 lakhs (Previous year Rs. 44.35 lakhs) and
materials Rs. 3.59 lakhs (Previous year Rs. 11.58 lakhs)
3. In terms of development contract with a customer, assets and
development expenditure of the value of Rs. 191 lakhs has been incurred
and equivalent amount received from the customer is netted against the
same. The company is holding these assets as a bailee in terms of the
development contract.
4. Related Party disclosures, as required by Accounting Standard 18
(AS 18)
(i) Name of the transacting Related Party:
- Seshasayee Paper and Boards Limited (SPB)
- Esvi International (Engineers & Exporters) Limitied
- Sri. S. Sridharan, Managing Director
- Dr. G A Pathanjali, Executive Director (Effective from 30.05.2012)
(ii) A description of the relationship between the parties:
Presumption of Significant influence.
(iii) A description of the nature of the transactions and volume of the
transaction, either as an amount or as an appropriate proportion:
5. The disclosures as required under Accounting Standard 17 (AS 17)
ÂSegment Reporting issued by the Institute of Chartered Accountants of
India is as under :- a. The company has considered business segment as
the primary segments for disclosure. The business segments are
Aerospace, Naval and Power System Batteries and Lead Acid Batteries.
The above reportable segments have been identified based on the
organisation structure as well as differing risks and returns
associated with the segments.
b. Segmental expenses and revenue wherever could not be identified to
a particular segment has been treated as Unallocated expenses and
revenue.
c. Segment assets and segment liabilities represent assets and
liabilities in respective segments. investments, tax related assets and
other assets and other liabilities that cannot be allocated to a
segment on reasonable basis have been disclosed as "unallocableÂ.
6. Employee Benefits
i) Defined Contribution Plans
Contribution of Rs. 31.38 lakhs to defined contribution plans is
recognized as expense and included in Employee Benefits (Note No. 25)
in the profit and loss account. (Previous year Rs. 26.26 lakhs)
Mar 31, 2012
Rupee Term Loan is repayable as per details below :
UCO Bank - 5 Annual installments ; Indian Bank and Canara Bank - 15
Quarterly installments
The Car loan is secured by the hypothecation of the car. The loan is
repayable in 60 exuviated monthly installments commencing from September
2011.
Working Capital Loans from Banks are secured by First Charge on
inventories, book debts and other moveable assets of the Company and
First Charge on all moveable and immovable fixed assets of the company
other than those pertaining to Lead Acid Battery Facility. The Working
Capital Loan is further secured by way of lien on Fixed Deposits
aggregating to Rs 50 lakhs.
1 Contingent Liabilities and Commitments
Counter Guarantees and Commitments
on Letters of Credit 1987.85 1250.41
Claims against the company not
acknowledged as Debts 28.00 28.00
Estimated amount of contracts
remaining to be executed on
capital account not provided for 5.09 4.61
Outstanding Silver Futures Contract 474.46 285.45
Outstanding Forward Contracts on
Forex Exposure 12.01 --
2. The Financial Statements for the year ended March 31, 2012 had
been prepared as per the then applicable, pre-revised Schedule VI to
the Companies Act, 1956. The Financial Statements for the year ended
March 31, 2012 are prepared as per Revised Schedule VI. Accordingly the
previous year figures have also been reclassified to conform to this
year's classification.
3. Transfer to Deferred Tax is mainly on account of difference in
charging depreciation prescribed under the Companies Act 1956, and
allowable under the Income Tax Act, 1961 and on account of unabsorbed
depreciation / business loss under Income Tax Act. Based on firm
orders on hand and improvements effected in the performance of both the
divisions including Lead Acid Battery Division, in the opinion of the
Management, the company will have adequate taxable income in the future
and there exists virtual certainty of the Deferred Tax Asset (DTA)
getting realized.
4. Expenditure on Scientific Research includes salaries and
allowances Rs 44.35 lakhs (Previous year Rs 46.50 lakhs) and materials Rs
11.58 lakhs (Previous year Rs 3.07 lakhs)
5. In terms of development contract with a customer, assets and
development expenditure of the value of Rs 191 lakhs has been incurred
and equivalent amount received from the customer is netted against the
same. The company is holding these assets as a bailee in terms of the
development contract.
6. The disclosures as required under Accounting Standard 17 (AS 17)
Segment Reporting issued by the Institute of Chartered Accountants of
India is as under
a. The company has considered business segment as the primary segments
for disclosure. The business segments are Aerospace, Naval and Power
System Batteries and Lead Acid Batteries. The above reportable segments
have been identified based on the organization structure as well as
differing risks and returns associated with the segments.
b. Segmental expenses and revenue wherever could not be identified to
a particular segment has been treated as Unallocated expenses and
revenue.
c. Segment assets and segment liabilities represent assets and
liabilities in respective segments, investments , tax related assets
and other assets and other liabilities that cannot be allocated to a
segment on reasonable basis have been disclosed as "unallowable".
7. Employee Benefits
i) Defined Contribution Plans
Contribution of Rs 26.26 lakhs to defined contribution plans is
recognized as expense and included in Employee Benefits (Note No. 25)
in the profit and loss account. (Previous yearRs 19.81 lakhs)
Mar 31, 2010
1. Figures have been rounded off to the nearest Rupee and the figures
for the previous year have been regrouped and reclassified wherever
necessary.
2. The New facility to manufacture Lead Acid Batteries (LAB) has
started commercial production on July 09, 2009. Pre-operative and Trial
Production expenses incurred till commencement of commercial production
aggregating to Rs 355.63 lakhs have been allocated to Fixed Assets.
3. Contingent Liabilities not provided for :
a. Counter guarantees and commitments on Letters of Credit Rs. 1077.02
lakhs. (Previous year Rs. 566.38 lakhs)
b. Claims against the Company not acknowledged as debts Rs.28 lakhs
(Previous year Rs. 28 lakhs).
c. Bills discounted with Banks : Rs 331.06 lakhs (Previous year Nil)
d. Bond Executed in favour of Commissioner of Customs towards Project
Imports Rs. 695.29 lakhs (Previous year Rs. 605.29 lakhs)
4. Estimated amount of contracts remaining to be executed on Capital
accounts: Rs 0.83 lakhs. (Previous year - Rs 141.47 lakhs)
5. Selling expenses include Rs. 29.22 lakhs towards commission on
sales (Previous year Rs. 8.79 lakhs)
6. Expenditure on Scientific Research includes salaries and allowances
Rs. 50.08 lakhs (Previous year Rs. 58.71 lakhs) and materials Rs. 8.98
Lakhs (Previous year Rs. 8.74 lakhs)
7. In terms of development contract with a customer, assets and
development expenditure of the value of Rs.191 lakhs has been incurred
and equivalent amount received from the customer is netted against the
same. The company is holding these assets as a bailee in terms of the
development contract.
8. Related Party disclosures, as required by Accounting Standard 18
(AS 18)
(i) Name of the transacting Related Party:
- Sri S Sridharan, Managing Director
- Seshasayee Paper and Boards Limited (SPB)
- Ponni Sugars (Erode) Limited (PEL)
- SPB Projects and Consultancy Limited (SPB-PC)
(ii) A description of the relationship between the parties:
Presumption of Significant influence.
(iii) A description of the nature of the transactions and volume of the
transaction, either as an amount or as an appropriate proportion:
S Sridharan
- Sri S Sridharan is the Managing Director and was in receipt of
remuneration as disclosed in Note No. 15 (a).
9. The disclosures as required under Accounting Standard AS-17
"Segment Reporting" issued by the Institute of Chartered Accountants of
India is as under:
a. The company has considered business segment as the primary segments
for disclosure. The business segments are Aerospace, Naval and Power
System Batteries and Lead Acid Batteries. The above reportable segments
have been identified based on the organisation structure as well as
differing risks and returns associated with the segments.
b. Segmental expenses and revenue wherever could not be identified to
a particular segment has been treated as Unallocated expenses and
revenue.
c. Segment assets and segment liabilities represent assets and
liabilities in respective segments. Investments , tax related assets
and other assets and liabilities that cannot be allocated to a segment
on reasonable basis have been disclosed as "unallocable"
10. Employee Benefits
i) Defined Contribution Plans
Contribution of Rs. 19.88 lakhs (including transitional liablility of
Rs 3.61 lakhs) to defined contribution plans is recognized as expense
and included in Employee cost (Schedule 13) in the profit and loss
account.
ii) Defined Benefit Plans
Disclosure for defined plans based on actuarial valuation as on
31.03.2010
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