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Notes to Accounts of Nagarjuna Agrichem Ltd.

Mar 31, 2017

b) Rights, Preferences and Restrictions attached to Equity shares

The Company has only one class of Equity shares having a par value of Rs. 1/- per share. Each holder of Equity shares is entitled to one vote per share

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

c) The Board of Directors in the meeting held on 27th May,2017 has recommended a final dividend of Re.0.125 per Equity Share of Re.1 each, subject to the approval of members in the ensuing Annual General Meeting.

d) Shares in the Company held by the Holding Company and Other Share holders holding more than 5%

Notes :

a) Term Loan availed from State Bank of India is secured by way of first charge on fixed assets of the company and second charge on current assets of the company along with other working capital lenders

b) Working Capital Term Loans availed from New India Co-operative Bank Ltd are secured by way of first charge on fixed assets of the company and other movable assets on pari passu basis with other term loan lendors.

c) Term Loan availed from SVC Co-Op Bank Ltd is secured by way of first charge on fixed assets of the company and Second charge on current assets to be shared with other term lenders .

d) Corporate Loan from SVC Co-Operative Bank Ltd. outstanding at Rs.2667 lakhs included in Term Loans from Banks above, is guaranteed by Smt. K.Lakshmi Raju a Director of the company.

e) All Credit facilities extended by State Bank of India are further secured by pledge of Promoter Shareholding equal to 30% of the Company’s equity.

g) Deferred payment liabilities.

Vide Revised order No.10/1/9/0023/0387/ID dated 31.01.2001 the Government of Andhra Pradesh had sanctioned Sales Tax Deferment to the Company in respect of Acephate and Profenofos for a period of fourteen years commencing from 28.09.1997 for Acephate and from 23.02.2000 for Profenofos subject to a maximum of Rs.1028.55 Lacs. The Sales Tax deferred in a year is payable at the end of 14th year without interest. Since financial year 2006-07 the company has decided not to avail the Sales Tax deferment. First repayment commenced from 25.09.2013 as prescribed in the order. Based on the Sales Tax Returns the sales tax so deferred aggregates to Rs.90.36 Lacs as at the balane sheet date. (Previous Year Rs. 165.41 Lacs).

* Loans Repayable on Demand from Banks (along with Non Fund Based Limits of Letters of Credit and Bank Guarantees) from the Consortirum i.e. State Bank of India, IDBI Bank Ltd, HDFC Bank Ltd & SVC Co-Operative Bank Ltd. are secured by way of hypothecation of current assets comprising stock in trade, book debts and stores and spares, both present and future. The aforesaid facilities are further secured by second charge on the company’s immovable and hypothecation of movable properties, both present and future, ranking pari passu with other Working Capital Lenders. The facilities sanctioned by State Bank of India, IDBI Bank Ltd, HDFC Bank Ltd are guaranteed by Sri K.S.Raju. The facilities sanctioned by SVC Co-Operative Bank Ltd. are guaranteed by Smt.K.Lakshmi Raju a Director of the company.

Note:

a) The Company has not received confirmations for the current year about the status under The Micro, Small and Medium Enterprises Development Act, 2006, from various creditors, consequent to which, the classification of dues to such Enterprises can not be compiled as at the Balance Sheet date

Note:

a) As at the date of this Balance Sheet, there are no amounts of Unclaimed dividends due for remittance to the Investor Education & Protection Fund.

1. Insurance Claim:

The company has recognized as income in the accounts the entire amount of claims received of Rs 45.65 Cr being the aggregate of insurance proceeds of Rs 32.44 Cr received during the year, Rs 10.00 Cr being the on-account insurance proceeds received and credited to Claims Receivable account and Rs 3.21 Cr being the sale proceeds of scrap credited to claims receivable account, in earlier years.

Consequently, the company has also recognized as expenses in the accounts Rs 20.08 Cr comprising fully damaged assets written off Rs 14.16 Cr, Work-in-progress written off Rs.1.31 crs and other expenses of Rs.0.66 crs arising out of the said accident and accounted under claims receivable so far. Further damages arising from the said accident assessed during the year at Rs.3.95 crs have also been expensed in these accounts. The net effect of Rs.25.57 crs has been disclosed as Exceptional Item.

The Company has contested the claim amount paid by the Insurance Company and initiated the Arbitration proceedings.

2. Borrowing Cost

Borrowing cost capitalized during the year is nil (Previous year nil)

37. Related Party Transactions (Disclosure as required by AS-18 “Related Party Disclosures) :

A. Names of related parties and description of relationship.

3. The remuneration has been paid to the Managing Director in accordance with the Sections 196, 197and 198 and other applicable provisions of The Companies Act, 2013

4. Employee Benefit Obligations

A. Defined Contribution Plan:

The company makes Provident Fund contribution to defined contribution retirement benefit plan for qualifying employees. Under the scheme the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. Contribution to defined contribution plan is recognized and charged off for the year as follows:

The obligation of Leave Encashment is recognized based on actuarial valuation made by an independent actuary at the end of the financial year.

C) “Nagarjuna Agrichem Ltd.-Employee Stock Option Scheme-2015”

i) The “Nagarjuna Agrichem Ltd.-Employee Stock Option Scheme-2015” (hereinafter referred to as “ESOS-2015”) was approved by the Shareholders in the 28th Annual General Meeting of the Company held on 28th September, 2015 and is being administered by the Compensation Committee of the Board of Directors, set up for the purpose

ii) Under the ESOS-2015, 11,50,000 options have been reserved to be issued to the eligible employees, with each option conferring a right upon such employee to apply for one equity share of Re.1/- each of the Company. The options granted under the Scheme would vest after a minimum period of one year from the date of grant and may spread over a maximum period of five years after the aforesaid one year. The options granted to the employees would be capable of being exercised within a period, of two years from the date of vesting;

iii) Pursuant to ESOS-2015, the Company, during the year 2015-16, has granted 9,30,000 (Nine Lakhs Thirty Thousand Only) options with a vesting period spread over maximum period of five years commencing after the aforesaid one year from the date of grant. The exercise price of Rs. 8/- (Rupees Eight Only) per share being less than the closing market price prevailing on the date prior to the date of grant, there arises deferred compensation cost which is to be suitably amortized over the period during which the vested options are to be exercised, in accordance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, and the Guidance Note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India. Accordingly an amount of Rs.21.08 lakhs has been accounted in the books of account as deferred compensation cost.

iv) Summary of Stock Option

5. Disclosure on Specified Bank Notes (SBNs

Specified Bank Notes (SBN) and other denomination notes on hand as defined in the MCA notification G.S.R. 308(E) dated 31 March, 2017 on the details of SBN held and transacted during the period from 8 November, 2016to 30 December, 2016

6. Balances in the accounts of various debtors, loans and advances and creditors are subject to reconciliation and confirmation

7. Figures of the previous year have been re-grouped/recast wherever necessary to conform to the current year’s presentation/ classification

8. Figures are rounded off to the nearest thousands.


Mar 31, 2016

b) Rights, Preferences and Restrictions attached to Equity shares

The Company has only one class of Equity shares having a par value of Rs. 1/- per share. Each holder of Equity shares is entitled to one vote per share.

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

Notes :

a) Term Loan availed from State Bank of India is secured by way of first charge on fixed assets of the Company and second charge on current assets of the Company along with other working capital lenders.

b) Working Capital Term Loans availed from New India Co-operative Bank Ltd are secured by way of first charge on fixed assets of the Company and other movable assets on pari passu basis with other term loan lendors.

c) Term Loan availed from SVC Co-Op Bank Ltd. is secured by way of first charge on fixed assets of the Company and Second charge on current assets to be shared with other term lenders .

d) Corporate Loan from State Bank of India outstanding at Rs. 250 lakhs included in Term Loans from Banks above, is guaranteed by Sri K.S. Raju a Director of the Company.

e) Corporate Loan from SVC Co-Operative Bank Ltd. outstanding at Rs. 3000 lakhs included in Term Loans from Banks above, is guaranteed by Smt. K. Lakshmi Raju a Director of the Company.

f) All Credit facilities extended by State Bank of India are further secured by pledge of Promoter Shareholding equal to 30% of the Company''s equity.

h) Deferred Payment Liabilities

Vide Revised order No.10/1/9/0023/0387/ID dated 31.01.2001 the Government of Andhra Pradesh had sanctioned Sales Tax Deferment to the Company in respect of Acephate and Profenofos for a period of fourteen years commencing from 28.09.1997 for Acephate and from 23.02.2000 for Profenofos subject to a maximum of Rs. 1028.55 Lacs. The Sales Tax deferred in a year is payable at the end of 14th year without interest. Since financial year 2006 07 the Company has decided not to avail the Sales Tax deferment. First repayment commenced from 25.09.2013 as prescribed in the order. Based on the Sales Tax Returns the sales tax so deferred aggregates to Rs. 165.41 Lacs as at the balane sheet date. (Previous Year Rs. 230.79 Lacs).

1. Employee Benefit Obligations:

A. Defined Contribution Plan:

The Company makes Provident Fund contribution to defined contribution retirement benefit plan for qualifying employees. Under the scheme the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. Contribution to defined contribution plan is recognized and charged off for the year as follows:

C. Nagarjuna Agrichem Ltd.-Employee Stock Option Scheme-2015”

i) The “Nagarjuna Agrichem Ltd.-Employee Stock Option Scheme” (hereinafter referred to as “ESOS-2015”) was approved by the Shareholders in the 28th Annual General Meeting of the Company held on 28th September, 2015. The scheme is to be administered by the Compensation Committee of the Board of Directors, set up for the purpose.

ii) Under the Scheme, 11,50,000 options have been reserve0d to be issued to the eligible employees, with each option conferring a right upon such employee to apply for one equity share of Re.1/- each of the Company. The options granted under the Scheme would vest after a minimum period of one year from the date of grant and may spread over a maximum period of five years after the aforesaid one year. The options granted to the employees would be capable of being exercised within a period, commencing from the date of vesting and shall expire on completion of two years from the date of vesting;

iii) Pursuant to ESOS-2015, the Company has, during the year, granted 9,30,000 (Nine Lakhs Thirty Thousand Only) options with a vesting period spread over maximum period of five years commencing after the aforesaid one year from the date of grant. The exercise price of Rs. 8/- (Rupees Eight Only) per share being less than the closing market price prevailing on the date prior to the date of grant, there arises deferred compensation cost which is to be suitably amortized over the period during which the vested options are to be exercised, in accordance withSecurities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, and the Guidance Note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India.

2. Figures of the previous year have been re-grouped/recast wherever necessary to conform to the current year''s presentation/classification.

3. Figures are rounded off to the nearest thousands.


Mar 31, 2015

1. During the year under review NACL entered into a marketing agreement for Solar Products in India with a foreign Company. Pending approvals from Government the said foreign Company unilaterally violated the contracted terms and dispatched three unauthorized consignments of unapproved solar products of a stated value of USD 2,803,625. NACL has refused to accept the said consignments and has been legally advised that there would not be any liability towards the same.

2. Based on the provisional insurance claim made by the Company in connection with the damages to the assets in the fire accident on 30.06.2012 at Srikakulam plant, the insurance Company has made an interim on-account payment of Rs. 10 crores. The Company has credited the same to the claims receivable account which, at the beginning of the year stood at Rs. 19.28 crores comprising Rs. 14.16 crores being the written down value of the damaged fixed assets, Rs. 5.12 crores being the estimated value of damaged inventories and others. The claim by the Company under the reinstatement value basis with the insurance Company continues to be under process as on 31.03.2015.

Pending final assessment of the damage to the partially damaged assets, the value if any to be de-capitalised therefrom, continues to be included in the gross block as on 31.03.2015.

Necessary adjustments in the accounts and the financial impact if any in respect of the aforesaid will be made on completion of final assessment.

3. Borrowing Cost

Borrowing cost capitalized during the year is nil (Previous year Rs. 254.51 Lacs

4. Minimum remuneration, in accordance with the provisions of Schedule V to the Companies Act, 2013, has been paid to the Managing Director, in the absence of Profits for the year.

5. Exceptional Item during the year is NIL (previous year amount Rs. 330.56 lakhs - Loss on Sale of Wind Mill Undertaking)

6. Provision has been made during the year for Minimum Alternate Tax (MAT) in accordance with the provisions of The Income Tax Act, 1961. As a prudent measure MAT Credit in respect of the said provision for the current year has not been recognized and will be reviewed and recognized at the appropriate time in subsequent years.

7. Employee Benefit Obligations

A. Defined Contribution Plan:

The Company makes Provident Fund contribution to defined contribution retirement benefit plan for qualifying employees. Under the scheme the Company is required to contribute a specified percentage of the payroll costs to fund the benefits.

B. Defined Benefit Plan:

Liability for retiring gratuity as on March 31, 2015 is Rs. 411.65 Lacs (as on March 31, 2014 – Rs. 416.21 Lacs) of which Rs. 300.73 Lacs (as on March 31, 2014- Rs. 292.01 Lacs) is funded with Life Insurance Corporation of India the balance is included in provision for Gratuity. Liability for Gratuity has been actuarially determined and provided in the books. The details of the Company's post-retirement benefit plans for its employees are given below which is certified by the actuary.

8. Balance of debtors, loans and advances and creditors are subject to reconciliation and confirmation.

9. Figures of the previous year have been re-grouped/recast wherever necessary to conform to the current year's presentation/classifi cation.

10. Figures are rounded off to the nearest thousands.


Mar 31, 2014

1. Corporate Information

NAGARJUNA AGRICHEM LTD, is a Public Limited Company listed with Bombay Stock Exchange. It is part of the Nagarjuna group based at Hyderabad. The Company is in the business of Crop Protection and manufactures both Technicals (Active Ingredient -AI) and Formulations. It manufactures all kinds of Pesticides, Insecticides, Acaricides, Herbicides, Fungicides and other Plant Growth Chemicals. The Company''s Formulation Business is mainly in the Indian Market and sells through its large retail dealer network of nearly 11,000 dealers, spread across India. The Company has an impressive range of Branded Formulations. It also exports Technicals and Formulations and does toll Manufacture for various Multinational Companies.

2. Commitments/ Contingent Liabilities:

Sl. As at 31.03.2014 As at 31.03.2013 Particulars No. Rs.in Lakhs Rs.in Lakhs

a. Commitments/ Contingent Liabilities

(i) Letters of Credit 6,797.91 4,119.62

(ii) Counter Guarantees 414.01 451.09

b. Claims against the Company not acknowledged as debts in respect of

(i) Disputed Excise Duty, Service Tax Demands 23.41 27.96 (Net of payments made under protest Rs.9.11 Lakhs)

(ii) Disputed Income Tax Demands - - (Net of payments made under protest Rs.430.40 Lakhs)

(iii) Disputed SalesTax Demands - - (Net of payments made under protest Rs.8.51 Lakhs)

c. Others 239.73 244.71

d. Estimated amount of contracts, remaining to be executed on Capital 1,453.09 899.59 account and not provided for (Net of advance)

3. Borrowing Cost

Borrowing cost incurred during the year for acquisition of assets aggregated to Rs.254.51 Lakhs (Previous year Rs.13.05Lakhs)

4. In compliance with clause 40A of the Listing Agreement read with relevant Securities & Exchange Board of India''s (SEBI) circulars with regard to Minimum Public Shareholding in a listed entity, pursuant to the approval by the Shareholders in the Extra-ordinary General Meeting held on 22nd May, 2013, the Company has allotted 69,29,938 Equity Shares of Rs.1/- each on 03rd June, 2013 as Bonus shares by way of capitalisation of Securities Premium Account, to Public Shareholders only (to the exclusion of Promoter Shareholders).

5. There was a fire incident on 30.06.2012 in Block-5 of the Company''s Srikakakulam plant. The Company had made a provisional assessment of the loss in the said incident and as per the terms of the insurance policy and duly lodged provisional claims with the Insurance Company covering the totally damaged assets, partially damaged assets, damaged inventories and other covered risks.

Accordingly in the books of account, the gross block value of the totally damaged assets aggregating to Rs.29.05 crores, was de-capitalised and its written down value of Rs.14.16 crores was included under "claim receivable" from the Insurance Company in the financial statement for the year ended 31.03.2013 and continues as such as on 31.03.2014.

Pending completion of the final assessment of damage to the partially damaged assets, the value if any to be decapitalised therefrom, continues to be included in the gross block as on 31.03.2014. On completion of the final assessment, appropriate treatment in the books of account will be made to the value of these assets.

The estimated value of the damaged inventories and other claims aggregating to Rs.4.56 crores was also included under "claim receivable" from the Insurance Company in the financial statements for the year ended 31.03.2013 and continues as such as on 31.03.2014.

The provisional claims made with the Insurance Company continue to be under process as at 31.03.2014. The Regional Claims Committee of the Insurance Company, has recommended for approval of its head office, for an on account interim payment towards the Company''s claims.

Necessary adjustments in the accounts and the financial impact if any in respect of the aforesaid will be made on completion of final assessment.

6. Related Party Transactions:

A. Names of related parties and description of relationship:

Sl. Relationship Party No.

1. Subsidiary Company Nagarjuna Agrichem (Australia) Pty Limited, Australia, LR Research Laboratories Pvt.Ltd.

2. Holding Company KLR Products Limited (Formerly GSR Products Limited)

3. Associate Nasense Labs Pvt.Ltd. (Formerly USP Organics Pvt Ltd.)

4. Key Management Personnel (KMP) Mr.V.Vijay Shankar, Managing Director

5. Enterprises over which Key Managerial Personnel are able to exercise significant influence

Indo International Fertilizers Ltd. Shubho-Tech Pvt. Ltd.

6. a) Individuals who, indirectly have control on the voting power in the company.

b) Relatives of (a) above

Mrs.K Lakshmi Raju, Director Mr.K.S.Raju (Father)

7. Enterprises under the significant influence of persons having significant influence over this company

Nagarjuna Fertilizers & Chemicals Ltd. Bhagiradha Chemicals & Industries Ltd.

7. Employee Benefit Obligations A. Defined Contribution Plan:

The Company makes Provident Fund contribution to defined contribution retirement benefit plan for qualifying employees. Under the scheme the Company is required to contribute a specified percentage of the payroll costs to fund the benefits.

B. Defined Benefit Plan:

Liability for retiring gratuity as on March 31, 2014 is Rs.416.21 Lakhs (as on March 31, 2013 - Rs.319.33 Lakhs) of which Rs.292.00 Lakhs (as on March 31, 2013- Rs.279.21 Lakhs) is funded with Life Insurance Corporation of India the balance is included in provision for Gratuity. Liability for Gratuity has been actuarially determined and provided in the books. The details of the Company''s post-retirement benefit plans for its employees are given below which is certified by the actuary.

8. Balance of debtors, loans and advances and creditors are subject to reconciliation and confirmation.

9. Figures of the previous year have been re-grouped/recast wherever necessary to conform to the current year''s presentation/classification.

10. Figures are rounded off to the nearest thousands.


Mar 31, 2013

1. Corporate Information

NAGARJUNA AGRICHEM LTD, is a Public Limited Company listed with Bombay Stock Exchange. It is part of the the Nagarjuna Group based at Hyderabad. The Company is in the business of Crop Protection and manufactures both Technicals (Active Ingredient -AI) and Formulations. It manufactures all kinds of pesticides, insecticides, acaricides, herbicides, fungicides and other plant growth chemicals. The Company''s Formulation Business is mainly in the Indian Market and sells through it''s large retail dealer network of nearly 13000 dealers, spread across India. The Company has an impressive range of branded Formulations. It also exports Technicals and Formulations and does Toll manufacture for various Multinational Companies.

2. Commitments/ Contingent Liabilities

As at 31.03.2013 As at 31.03.2012 Sl. No. Particulars Rs. In Lakhs Rs.In Lakhs

a. Commitments/ Contingent Liabilities

(i) Letters of Credit 4119.62 6458.55

(ii) Counter Guarantees * 451.09 222.20

b. Claims against the Company not acknowledged as debts in respect of

(i) Excise Duty, Service Tax Demands - Company has 27.96 24.83 appealed against orders raised the demands

(ii) Income Tax Demands - Company has appealed against - 73.21 orders raised the demands. (Net of payments made under protest)

c. Estimated amount of contracts, remaining to be 899.59 982.09 executed on Capital account and not provided for (net of advance)

d. Others 244.71 250.78

3. Borrowing Cost

Borrowing Cost incurred during the year for acquisition of assets aggregated to Rs.13.05 Lakhs (Previous year Rs.10.54 Lakhs)

4. In compliance with the requirement of clause 40A of the Listing Agreement to raise public shareholding of the Company to not less than 25%, the Board of Directors of the Company at a meeting held on 27th April, 2013, recommended issue of bonus shares only to public shareholders (otherthan Promoters) of the Company in the ratio of 3 equity shares for every 14 equity shares held by them, which is subject to the approval of the Shareholders in the ensuring EGM to be held on 22nd May, 2013.

5. The Management has made a provisional assessment of the loss in fire incident in Block 5 at Srikakulam. The Company has lodged provisional claim with the Insurance Company covering the totally damaged assets and partially damaged assets. In addition, claim is made for damaged inventories and other risks covered as per the terms of the insurance policies.

The gross block value of the totally damaged assets, as per the books of account, aggregating to Rs.29.05 Crores, has been de-capitalised and included in the provisional claim receivable from the Insurance Company.

In the case of partially damaged assets, the Company has made a claim with Insurance Company. Pending completion of the repairs and final assessment, the value of the partially damaged assets continues to be included in the gross block.

The estimated value of the damaged inventories of Rs.4.46 Crores is exhibited under provisional claims receivable from the Insurance Company.

The provisional claims made with the Insurance Company are under process and on completion of final assessment and its acceptance, necessary adjustments in the accounts and the financial impact if any will be accounted.

The obligation of Leave Encashment is recognized based on actuarial valuation made by an independent actuary at the end of the financial year.

6. Balance of Debtors, Loans and Advances and Creditors are subject to reconciliation and confirmation.

7. Figures of the previous year have been re-grouped/recast wherever necessary to conform to the current year''s presentation/classification.

8. Figures are rounded off to the nearest thousands.


Mar 31, 2012

Notes :

a) The Term Loans (except Term Loan for Wind Energy project) availed from State Bank of India, IDBI Bank Ltd & HDFC Bank Ltd are secured by way of equitable Mortgage by deposit of Title Deeds of the Company's immovable properties both present and future and by way of first charge of all Fixed Assets of the Company as a primary security and hypothecation of movable properties of the Company ranking pari passu and borrowings from State Bank of India and IDBI Bank Ltd are further secured by a second charge on the current assets of the Company consisting of stock in trade, book debts, stores and spares.

b) Term Loan availed from State Bank of India for Wind Power project is secured by way of mortgage by deposit of Title Deeds of the project's immovable properties and

by way of first charge of all project fixed assets as a primary security.

c) Working Capital Term Loan availed from New India Co-operative Bank Ltd is secured by way of first charge on Company's fixed assets including other movable assets on pari passu basis.

d) Term Loans from Banks (except Term Loan from HDFC Bank Ltd & Corporate Loan from State Bank of India and Working Capital Term Loan from New India Co-operative Bank Ltd availed during the FY 2009-10) and Working Capital Loans from Banks are personally guaranteed by Sri K.S. Raju, a Director of the Company.

e) Terms of Repayments are given below:

i) Loan taken from HDFC Bank is repayable in 12 Quarterly Installments of Rs. 200 Lakhs each. commencing from August 2010; Interest Rate @12.56%

ii) Loan taken from IDBI Bank is repayable in 54 monthly Installments of Rs. 55.55 Lakhs each commencing from January, 2011; Interest Rate 14.25%

iii) Loan taken from SBI Corporate Term Loan is repayable in 8 Quarterly Installments of Rs. 250 Lakhs each. commencing from June, 2010; Interest Rate 15.00% and Outstanding Balance as on 31st March 2012 Rs. Nil.

iv) Loan taken from New India Working Capital Term Loan is repayable in 5 yearly installments of Rs. 480 Lakhs each. commencing from March, 2011; Interest Rate 11%

v) Loan taken from SBI Term Loan-Wind Power Project is repayable in 24 quarterly Instalments of Rs. 90 Lakhs each commencing from September, 2011; Interest Rate 13.75%

f) Deferred Payment Liabilities.

i) Sales Tax Deferment: Vide order No.10/1/5/0564/0696 dated 26th April, 1995 the Government of Andhra Pradesh had sanctioned Sales Tax Deferment to the Company in respect of Monocrotophos for a period of Ten Years commencing from 1.7.1994; subject to a maximum of Rs.1330.27 Lakhs. Based on the Sales Tax Returns, the sales tax so deferred aggregates net of repayments to Rs.147.99 Lakhs. (Previous Year Rs. 262.85 Lakhs). The repayment of deferred Sales Tax has commenced from July, 2004 as prescribed in the said order.

ii) Further vide Revised order No.10/1/9/0023/0387/ ID, dated 31.01.2001, the Government of Andhra Pradesh had sanctioned Sales Tax Deferment to the Company in respect of Acephate and Profenofos for a period of fourteen years commencing from 28.09.1997 for Acephate and from 23.02.2000 for Profenofos, subject to a maximum of Rs.1028.55 Lakhs. The Sales Tax deferred in a year is payable at the end of 14th Year without interest. First payment will commence from 25.09.2013 as prescribed in the order. Since financial year 2006-07, the Company has decided not to avail the Sales Tax deferment and opted to pay the Sales Tax henceforth. Based on the Sales Tax Returns, the Sales Tax so deferred aggregates to Rs. 293.73 Lakhs. (Previous Year Rs. 301.62 Lakhs).

* Cash Credits, Working Capital Demand Loan including Non Fund Based Limits of Letters of Credit and Bank Guarantees from State Bank of India, IDBI Bank Ltd & HDFC Bank Ltd and Corporate Loan availed from State Bank of India are secured by way of hypothecation of current assets comprising of stock in trade, book debts and stores and spares, both present and future. The aforesaid facilities are further secured by second charge of the Company's immovable and hypothecation of movable properties, both present and future, ranking pari passu with the Term Loans.

Note: a) Out of the said amount Rs. 249.82 Lakhs (Previous year Rs. 114.32 Lakhs) pertains to Micro, Small and Medium Enterprises as defined under Micro, Small and Medium Enterprises Developmenent Act, 2006 based on the information available with the Company. There is no interest payable to such parties as at 31st March 2012. (March 31, 2011: Rs. Nil)

b) Dues to Micro and Small Industrial Undertakings, exceeding 45 days - Rs. 52.69 Lakhs (Previous year - Rs. 24.88 Lakhs)

Note: a) The Company has been regularly transferring Unclaimed Dividend to the Investor Education and Protection Fund after the expiry of the prescribed period. For current year the Company is yet to receive full information from some Banks. Pending receipt of such information the Company is in process of reconciling the Unclaimed Dividend Account.

Note No. 1 :

Borrowing Cost incurred during the year for acquisition of assets aggregated to Rs. 10.54 Lakhs (Previous year Rs. 172.93 Lakhs)

Note No. 2 :

During the year, the Company has incorporated a Wholly Owned Subsidiary, limited by shares viz. LR Research Laboratories Pvt. Ltd. under the Companies Act, 1956. The Company has also a Wholly Owned Subsidiary in Australia viz. Nagarjuna Agrichem (Australia) Pty. Limited. As operations are yet to commence in these Companies, no consolidation of Financial Statements is required.

Note No. 3 : Current Tax

It is decided by the Management that, even though the Wind Energy Business is entitled for deduction u/s-80 IA for the FY 2010-11, (AY 2011-12) would not be treated as the initial assessment year.

For the year, the Company is obliged to pay current tax of Rs. 285.10 Lakhs under the MAT provisions of Section - 115JB of Income Tax Act, 1956. At this stage, Management is of opinion that there is no virtual certainty to recognize MAT Credit entitlement as an asset for the current year as per the Guidance Note issued by ICAI.

Note No. 4 : Employee Benefit Obligations: A. Defined Contribution Plan:

The Company makes Provident Fund contribution to defined contribution retirement benefit plan for qualifying employees. Under the scheme the Company is required to contribute a specified percentage of the payroll costs to fund the benefits.

Contribution to Defined Contribution Plan is recognized and charged off for the year as follows:

B. Defined Benefit Plan:

Liability for retiring gratuity as on March 31, 2012 is Rs. 269.22 Lakhs (as on March 31, 2011 - Rs. 248.18 Lakhs) of which Rs. 249.19 Lakhs (as on March 31, 2011-Rs. 226.16 Lakhs) is funded with Life Insurance Corporation of India/ ING Vysya Life Insurance Company Private Limited and the balance is included in provision for Gratuity. Liability for Gratuity has been actuarially determined and provided in the books. The details of the Company's post-retirement benefit plans for its Employees are given below which is Certified by the Actuary.

Note No. 5 :

Balance of Debtors, Loans and Advances and Creditors are subject to Reconciliation and Confirmation.

Note No. 6 :

Figures of the previous year have been re-grouped/recast wherever necessary to conform to the current year's presentation/classification.

Note No. 7 :

Figures are rounded off to the nearest Thousands.


Mar 31, 2011

1. a. Estimated amount of contracts, remaining to be executed on Capital account and not provided for (net of advances) Rs. 897.18 Lacs (Previous year Rs. 2183.23 Lacs).

b. Contingent Liabilities

As at As at Particulars 31.03.2011 31.03.2010 Rs.ln Lacs Rs.in Lacs

Letters of Credit 2670.00 2378.39

Counter Guarantees * 774.19 631.35

Excise Duty, Service Tax Demands - Company has appealed against 28.23 54.11 orders raised the demands

Income Tax Demands - Company has appealed against orders raised 90.50 120.79 the demands

* Includes renewal of guarantee provided on behalf of Nagarjuna Hydro Energy Pvt Ltd for an amount of Rs. 475.37 Lacs (Previous year Rs. 463.88 Lacs).

2. Secured Loans:

The Term Loans (except Wind energy project term loan) availed from State Bank of India, IDBI Bank Ltd & HDFC Bank Ltd and the External Commercial Borrowing (ECB) from ICICI Bank Limited are secured by way of equitable mortgage by deposit of title deeds of the Company's immovable properties both present and future and by way of first charge of all fixed assets of the Company as a primary security and hypothecation of movable properties of the company ranking pari passu and borrowings from State Bank of India, IDBI Bank Ltd and ICICI Bank Ltd are further secured by a second charge on the current assets of the company consisting of stock in trade, book debts and stores and spares.

Term Loan availed from State Bank of India for Wind power project is secured by way of mortgage by deposit of title deeds of the project's immovable properties and by way of first charge of all project fixed assets as a primary security.

Working Capital Term Loan availed from New India Co-operative Bank Ltd is secured by way of first charge, ranking pari passu, of all movable fixed assets of the company as a primary security. Cash Credits, Working Capital Demand Loan including Non Fund Based Limits of Letters of Credit and Bank Guarantees from State Bank of India, IDBI Bank Ltd & HDFC Bank Ltd and Corporate Loan availed from State Bank of India are secured by way of hypothecation of current assets comprising of stock in trade, book debts and stores and spares, both present and future. The aforesaid facilities are further secured by second charge of the company's immovable and hypothecation of movable properties, both present and future, ranking pari passu with the term loan lenders.

Term loans from banks (except Term Loan from HDFC Bank Ltd & Corporate Loan from State Bank of India and Working Capital Term Loan from New India Co-operative Bank Ltd availed during the financial year 2009-10) and working capital loans from banks are personally guaranteed by Sri K.S. Raju, a Director of the company.

3. Unsecured Loans:

Sales Tax Deferral:

Sales Tax Deferment: Vide order No.10/1/5/0564/0696 dated 26th April, 1995 the Government of Andhra Pradesh had sanctioned Sales Tax Deferment to the Company in respect of Monocrotophos for a period of ten years commencing from 1.7.1994; subject to a maximum of Rs.1330.27 Lacs. Based on the Sales Tax Returns, the sales tax so deferred aggregates net of repayments to Rs.262.85 Lacs. (Previous Year Rs. 331.24 Lacs). The repayment of deferred Sales Tax has commenced from July, 2004 as prescribed in the said order.

Further vide Revised order No. 10/1/9/0023/0387/1D, dated 31.01.2001, the Government of Andhra Pradesh had sanctioned Sales Tax Deferment to the Company in respect of Acephate and Profenofos for a period of fourteen years commencing from 28.09.1997 for Acephate and from 23.02.2000 for Profenofos, subject to a maximum of Rs.1028.55 Lacs. The Sales Tax deferred in a year is payable at the end of 14th year without interest. First payment commence from 25.09.2013 as prescribed in the order. Since financial year 2006-07, the company has decided not to avail the Sales Tax deferment and opted to pay the sales tax henceforth. Based on the Sales Tax Returns, the sales tax so deferred aggregates to Rs.301.62 Lacs. (Previous Year Rs. 301.62 Lacs).

4. Borrowing cost incurred during the year for acquisition of assets aggregated to Rs.172.93 Lacs (Previous year Rs. 110.18 Lacs) plus expenditure pending allocation opening balance of Rs.53.15 lacs against which an amount Rs. 226.08 Lacs (Previous year Rs. 57.03 Lacs) has been capitalized against qualifying assets and the balance Rs. Nil (Previous year Rs. 53.15 Lacs) is included under Expenditure pending allocation.

5. During the year, the company has commissioned Wind energy project with a capacity of 6.3 MW in the month of Sep'10.

6. During the year, the company has incorporated a wholly owned subsidiary as a proprietary company limited by shares viz., Nagarjuna Agrichem (Australia) Pty Limited in Australia under Corporations Act 2001 as on 30.03.2011. As operations are yet to commence in this company, no consolidation of financial statements is required.

7. During the year, the company has written off the expenditure incurred on certain project related activities for Rs.303.03 lacs under the head "CWIP written off" and grouped under "Administrative, Selling/ Distribution and Other Expenses".

8. Segment Reporting

a. Primary Segment Information:

The Company's main business segment is Agro Chemicals, Wind energy business does not fall under reportable business segment as per Accounting Standard-17. Hence there is no separate reportable business segment as per "Segment Reporting - Accounting Standard-17".

b. Secondary Segment Information:

Secondary Segment reporting is based on the geographical location of customers. The management views India and Outside India markets as distinct geographical segments.

9. Related Party Transactions:

A. Names of related parties and description of relationship.

Relationship Party

Subsidiary Company Nagarjuna Agrichem (Australia) Pty Limited, Australia

Holding Company KLR Products Limited (Formerly GSR Products Limited)

Associates iKisan Limited Indo International Fertilizers Ltd. Nagarjuna Fertilizers & Chemicals Ltd Bhagiradha Chemicals & Industries Ltd Nagarjuna Hydro Energy Pvt Ltd

Key Management Personnel (KMP) Mr.Ashok Muni, Director & COO (part of the year) Mr.Vijaya Raghavan, Whole time Director Mrs.K Lakshmi Raju, Director (having significant influence)

Relatives of Dir ectors Mr KS Raju (Father of Mrs.K Lakshmi Raju, Director) Mrs.K Lakshmi Raju (Sister of Mr.KS Raju, Director)

10. Current Tax

It is decided by the management that, even though the wind energy business is entitled for deduction u/s-80 IA for the FY 2010-11, the current AY 2011-12 would not be treated as the initial assessment year. For the year, the company is obliged to pay current tax of Rs. 128.56 Lacs under the MAT provisions of Section - 115JB of Income-tax Act, 1956. At this stage, Management is of opinion that there is no virtual certainty to recognize MAT Credit entitlement as an asset for the current year as per the Guidance note issued by ICAI.

11. Deferred Tax

Deferred Tax is accounted in respect of the timing differences on a liability method. Deferred Tax Asset has been recognised to the extent where the management is reasonably certain that the realisation is more likely than not.

12. Employee Benefit Obligations

A. Defined Contribution Plan:

The company makes Provident Fund contribution to defined contribution retirement benefit plan for qualifying employees. Under the scheme the Company is required to contribute a specified percentage of the payroll costs to fund the benefits.

B. Defined Benefit Plan:

Liability for retiring gratuity as on March 31, 2011 is Rs.248.18 Lacs (as on March 31, 2010 - Rs. 238.51 Lacs) of which Rs.226.16 Lacs (as on March 31, 2010-Rs. 210.50 Lacs) is funded with Life Insurance Corporation of India/ ING Vysya Life Insurance Company Private Limited and the balance is included in provision for Gratuity. Liability for Gratuity has been actuarially determined and provided in the books. The details of the Company's post-retirement benefit plans for its employees are given below which is certified by the actuary.

13. The company has been regularly transferring unclaimed dividend to the Investor Education and Protection Fund after the expiry of the prescribed period. In respect of previous years the company has obtained details of the account and noticed certain discrepancies which are under reconciliation. For current year the company is yet to receive full information from some banks. Pending receipt of such information the company is in process of reconciling the unclaimed dividend account.

14. Balance of debtors, loans and advances and creditors are subject to reconciliation and confirmation.

15. Figures of the previous year have been re-grouped/recast wherever necessary to conform to the current year's presentation/classification.

16. Figures are rounded off to the nearest rupee.


Mar 31, 2010

Form for disclosure of Particulars with respect to technology absorption.

A.RESEARCH AND DEVELOPMENT (R&D)

1 Specific areas in which R&D carried out by the Company

a.R&D Work on the existing processes to make them environmentally friendly and cost effective.

b.Indigenous process developments for new products.

2.Benefits derived as a result of the above R&D

Increased export business and improved product quality.

3.Future plans of action

Introduction of new products through indigenously developed technology.

4.Expenditure on R&D

a.Capital Rs.0.99 lakhs

b.Recurring Rs.109.36 lakhs

c.Total Expenditure as a percentage of 0.17% total turnover



B.TECHNOLOGY ABSORPTION,ADAPTATION AND INNOVATION

1 Efforts in brief,made towards technology absorption,adaptation and innovation.

Increased size of R&D process development, purchase of new equipments and generation of process technical for new products.

2.Benefits derived as a result of the above effort eg.Product improvement,cost reduction product development,import substitution etc.,

a.The plants operate effectively with new addition of products,

b.Exports started growing.

3.In case of imported technology (imported during the last 5 years reckoned from the beginning of the technical year)following information may be furnished

a.Technology imported None

b.Year of import Not Applicable

c.Has technology been fully absorbed Not Applicable

d.If not fully absorbed,areas where this has not taken place,reasons therefore and future plans of action Not Applicable

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