Notes to Accounts of Orient Electric Ltd.

Mar 31, 2025

r. Provisions and contingent liabilities
- General Provisions

R provision is recognised when the Company has a
present obligation (legal or constructive) as a result of
past event, it is probable that an outflow of resources
embodying economic benefits will be required to
settle the obligation and a reliable estimate can
be made of the amount of the obligation. These
estimates are reviewed at each reporting date and
adjusted to reflect the current best estimates. If
the effect of the time value of money is material,
provisions are discounted using a current pre-tax rate
that reflects, when appropriate, the risks specific to

the liability. When discounting is used, the increase in
the provision due to the passage of time is recognised
as a finance cost.

- Warranty Provisions

Provisions for warranty-related costs are recognised
when the product is sold or service provided. Provision
is based on technical estimates by the management
based on past trends. The estimate of such warranty-
related costs is revised annually

- Contingent liabilities

A contingent liability is a possible obligation that
arises from past events whose existence will be
confirmed by the occurrence or non-occurrence of one
or more uncertain future events beyond the control
of the Company or a present obligation that is not
recognised because it is not probable that an outflow
of resources will be required to settle the obligation. A
contingent liability also arises in extremely rare cases
where there is a liability that cannot be recognised
because it cannot be measured reliably. The Company
does not recognize a contingent liability but discloses
its existence in the financial statements.

Provisions, contingent liabilities, contingent
assets and commitments are reviewed at each
balance sheet date.

s. Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and in
hand and short-term deposits with an original maturity of
three months or less, which are subject to an insignificant
risk of changes in value.

. Financial instruments

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

i. Financial Assets

Initial recognition and measurement

All financial assets are recognised initially at fair
value plus, in the case of financial assets not recorded
at fair value through profit or loss, transaction costs
that are attributable to the acquisition of the financial
asset. Financial assets are classified, at initial
recognition and subsequently measured at amortised
cost, fair value through other comprehensive income
(OCI), and fair value through profit or loss.

The classification of financial assets at initial
recognition depends on the financial asset''s
contractual cash flow characteristics and the
Company''s business model for managing them. With
the exception of trade receivables that do not contain
a significant financing component or for which the
Company has applied the practical expedient, the
Company initially measures a financial asset at its
fair value plus, in the case of a financial asset not
at fair value through profit or loss, transaction costs.
Trade receivables that do not contain a significant
financing component or for which the Company has
applied the practical expedient are measured at the
transaction price determined under Ind AS 115. Refer
to the accounting policies on Revenue from contracts
with customers.

In order for a financial asset to be classified and
measured at amortised cost or fair value through
OCI, it needs to give rise to cash flows that are ''solely
payments of principal and interest (SPPI)'' on the
principal amount outstanding. This assessment is
referred to as the SPPI test and is performed at an
instrument level.

The Company''s business model for managing
financial assets refers to how it manages its financial
assets in order to generate cash flows. The business
model determines whether cash flows will result from
collecting contractual cash flows, selling the financial
assets, or both.

Purchases or sales of financial assets that require
delivery of assets within a time frame established by
regulation or convention in the market place (regular
way trades) are recognised on the trade date, i.e.,
the date that the Company commits to purchase or
sell the asset.

Subsequent measurement

For purposes of subsequent measurement financial
assets are classified in following categories:

- Debt instruments at fair value through profit
and loss (FVTPL)

- Debt instruments at fair value through other
comprehensive income (FVTOCI)

- Debt instruments at amortized cost

- Equity instruments

Where assets are measured at fair value, gains and
losses are either recognised entirely in the statement
of profit and loss (i.e. fair value through profit or loss),
or recognised in other comprehensive income (i.e.
fair value through other comprehensive income). For
investment in debt instruments, this will depend on
the business model in which the investment is held.
For investment in equity instruments, this will depend
on whether the Company has made an irrevocable
election at the time of initial recognition to account
for equity instruments at FVTOCI.

Debt instruments at amortized cost

A Debt instrument is measured at amortized cost if
both the following conditions are met:

- The asset is held within a business model
whose objective is to hold assets for collecting
contractual cash flows, and

- Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on the
principal amount outstanding.

This category is most relevant to the Company.
After initial measurement, such financial assets are
subsequently measured at amortized cost using the
effective interest rate (EIR) method. Amortised cost
is calculated by taking into account any discount or
premium on acquisition and fees or costs that are an
integral part of EIR. EIR is the rate that exactly discounts
the estimated future cash receipts over the expected
life of the financial instrument or a shorter period,
where appropriate, to the gross carrying amount of the
financial asset. When calculating the effective interest
rate, the Company estimates the expected cash flows
by considering all the contractual terms of the financial
instrument but does not consider the expected credit
losses. The EIR amortization is included in finance income
in profit or loss. The losses arising from impairment are
recognised in the profit or loss. This category generally
applies to trade and other receivables.

Debt instruments at fair value through OCI

A Debt instrument is measured at fair value
through other comprehensive income if following
criteria are met:

- Business Model Test: The objective of financial
instrument is achieved by both collecting

contractual cash flows and for selling
financial assets.

- Cash flow characteristics test: The contractual
terms of the Debt instrument give rise on
specific dates to cash flows that are solely
payments of principal and interest on principal
amount outstanding.

Debt instrument included within the FVTOCI category
are measured initially as well as at each reporting date
at fair value. Fair value movements are recognised
in the other comprehensive income (OCI), except
for the recognition of interest income, impairment
gains or losses and foreign exchange gains or losses
which are recognised in statement of profit and loss.
On derecognition of asset, cumulative gain or loss
previously recognised in OCI is reclassified from the
equity to statement of profit and loss. Interest earned
whilst holding FVTOCI financial asset is reported as
interest income using the EIR method.

Debt instruments at FVTPL

FVTPL is a residual category for financial instruments.
Any financial instrument, which does not meet the
criteria for amortized cost or FVTOCI, is classified
as at FVTPL. In addition, the Company may elect
to designate a debt instrument, which otherwise
meets amortized cost or FVTOCI criteria, as at
FVTPL. However, such election is allowed only if
doing so reduces or eliminates a measurement or
recognition inconsistency (referred to as ''accounting
mismatch''). The Company has not designated any
debt instrument as at FVTPL.

Debt instruments included within the FVTPL category
are measured at fair value with all changes recognised
in the statement of profit and loss.

Investments in mutual funds

Investment in mutual funds are measured at fair
value through profit or loss (FVTPL).

Equity Investment

Fill equity investments in scope of Ind RS 109 are
measured at fair value. Equity instruments which
are held for trading and contingent consideration
recognised by an acquirer in a business combination
to which Ind RS 103 applies are classified as at
FVTPL. For all other equity instruments, the Company
may make an irrevocable election to present in other
comprehensive income subsequent changes in the

fair value. The Company makes such election on an
instrument-by-instrument basis. The classification is
made on initial recognition and is irrevocable.

If the Company decides to classify an equity
instrument as at FVTOCI, then all fair value changes
on the instrument, excluding dividends, are recognized
in the OCI. There is no recycling of the amounts from
OCI to P&L, even on sale of investment. However,
the Company may transfer the cumulative gain or
loss within equity.

Equity instruments included within the FVTPL
category are measured at fair value with all changes
recognized in the P&L.

Derecognition

R financial asset (or, where applicable, a part of a
financial asset or part of a Company of similar financial
assets) is primarily derecognised (i.e. removed from
the Company''s statement of financial position) when:

- The rights to receive cash flows from the asset
have expired, or

- the Company has transferred its rights to receive
cash flows from the asset or has assumed an
obligation to pay the received cash flows in full
without material delay to a third party under a
"pass through" arrangement and either;

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

- the Company has retained the contractual right
to receive the cash flows of the financial asset,
but assumes a contractual obligation to pay the
cash flows to one or more recipients.

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

Where the Company has neither transferred a
financial asset nor retains substantially all risks and
rewards of ownership of the financial asset, the
financial asset is derecognised if the Company has
not retained control of the financial asset. Where the
Company retains control of the financial asset, the

asset is continued to be recognised to the extent of
continuing involvement in the financial asset.

Impairment of financial assets

In accordance with inD RS 109, the Company applies
expected credit losses (ECL) model for measurement
and recognition of impairment loss on the following
financial asset and credit risk exposure:

- Financial assets that are debt instruments,
and are measured at amortised cost e.g., loans,
debt securities, deposits, trade receivables
and bank balance,

- Financial assets that are debt instruments and
are measured as at FVTOCI;

The Company follows "simplified approach" for recognition
of impairment loss allowance on:

- Trade receivables or contract revenue receivables;

- Rll lease receivables resulting from the transactions
within the scope of inD RS 116

Under the simplified approach, the Company does
not track changes in credit risk. Rather, it recognizes
impairment loss allowance based on lifetime ECLs at
each reporting date, right from its initial recognition.
The Company uses a provision matrix to determine
impairment loss allowance on the portfolio of trade
receivables. The provision matrix is based on its
historically observed default rates over the expected
life of trade receivable and is adjusted for forward
looking estimates. Rt every reporting date, the
historical observed default rates are updated and
changes in the forward looking estimates are analysed.

For recognition of impairment loss on other financial
assets and risk exposure, the Company determines
whether there has been a significant increase in the
credit risk since initial recognition. If credit risk has
not increased significantly, 12-month ECL is used to
provide for impairment loss. However, if credit risk
has increased significantly, lifetime ECL is used. If, in
subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition, then
the Company reverts to recognizing impairment loss
allowance based on 12- months ECL.

Lifetime ECL are the expected credit losses resulting
from all possible default events over the expected

life of a financial instrument. The 12-month ECL is a
portion of the lifetime ECL which results from default
events that are possible within 12 months after the
reporting date.

ECL is the difference between all contractual cash
flows that are due to the Company in accordance with
the contract and all the cash flows that the entity
expects to receive (i.e., all cash shortfalls), discounted
at the original EIR. When estimating the cash flows,
an entity is required to consider:

- Rll contractual terms of the financial instrument
(including prepayment, extension, call and
similar options) over the expected life of the
financial instrument.

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

ii. Financial liabilities:

Initial recognition and measurement

Financial liabilities are classified at initial recognition,
as financial liabilities at fair value through profit
or loss, loans and borrowings, and payables, net of
directly attributable transaction costs. The Company
financial liabilities include loans and borrowings
including bank overdraft, trade payables, trade
deposits, retention money, and liabilities towards
services, sales incentive and other payables.

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

Trade Payables

These amounts represent liabilities for goods and
services provided to the Company prior to the end
of financial year which are unpaid. Trade and other
payables are presented as current liabilities unless
ppayment is not due within 12 months after the
reporting period. They are recognised initially at fair
value and subsequently measured at amortized cost
using EIR method.

Financial liabilities at Fair value through profit or loss

Financial liabilities at fair value through profit or loss
include financial liabilities held for trading and financial
liabilities designated upon initial recognition as at fair
value through profit or loss. Financial liabilities are
classified as held for trading if they are incurred for
the purpose of repurchasing in the near term.

Gains or losses on liabilities held for trading are
recognised in the statement of profit and loss.

Financial liabilities designated upon initial recognition
at fair value through profit or loss are designated as such
at the initial date of recognition, and only if the criteria
in IND AS 109 are satisfied. For liabilities designated
as FVTPL, fair value gains/ losses attributable to
changes in own credit risk are recognised in OCI. These
gains/ losses are not subsequently transferred to
profit and loss. However, the Company may transfer
the cumulative gain or loss within equity. All other
changes in fair value of such liability are recognised
in the statement of profit and loss. The Company has
not designated any financial liability as at fair value
through profit and loss.

Loans and borrowings

Borrowings are initially recognised at fair value, net
of transaction cost incurred. After initial recognition,
interest-bearing loans and borrowings are subsequently
measured at amortized cost using the EIR method.
Gains and losses are recognised in statement of profit
and loss when the liabilities are derecognised as well
as through the EIR amortization process. Amortized
cost is calculated by taking into account any discount
or premium on acquisition and fees or costs that are an
integral part of the EIR. The EIR amortization is included
as finance costs in the statement of profit and loss.

Derecognition

A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or
expires. When an existing financial liability is replaced
by another from the same lender on substantially
different terms, or the terms of an existing liability
are substantially modified, such an exchange or
medication is treated as the derecognition of the
original liability and the recognition of a new liability.
The difference in the respective carrying amounts is
recognised in the statement of profit and loss.

Embedded derivatives

An embedded derivative is a component of a hybrid
(combined) instrument that also includes a non¬
derivative host contract with the effect that some of
the cash flows of the combined instrument vary in a
way similar to a standalone derivative. An embedded
derivative causes some or all of the cash flows that
otherwise would be required by the contract to be
modified according to a specified interest rate,
financial instrument price, commodity price, foreign
exchange rate, index of prices or rates, credit rating
or credit index, or other variable, provided in the case
of a nonfinancial variable that the variable is not
specific to a party to the contract. Reassessment only
occurs if there is either a change in the terms of the
contract that significantly modifies the cash flows
that would otherwise be required or a reclassification
of a financial asset out of the fair value through
profit or loss.

If the hybrid contract contains a host that is a financial
asset within the scope of Ind AS 109, the Company
does not separate embedded derivatives. Rather, it
applies the classification requirements contained in
Ind AS 109 to the entire hybrid contract. Derivatives
embedded in all other host contracts are accounted
for as separate derivatives and recorded at fair value
if their economic characteristics and risks are not
closely related to those of the host contracts and the
host contracts are not held for trading or designated
at fair value though profit or loss. These embedded
derivatives are measured at fair value with changes
in fair value recognised in profit or loss, unless
designated as effective hedging instruments.

Offsetting of financial instruments:

Financials assets and financial liabilities are offset
and the net amount is reported in the balance sheet
if there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realize the assets and settle
the liabilities simultaneously.

Reclassification of financial assets:

The Company determines classification of financial
assets and liabilities on initial recognition. After
initial recognition, no reclassification is made for
financial assets which are equity instruments and
financial liabilities. For financial assets which are debt
instruments, a reclassification is made only if there is

a change in the business model for managing those
assets. Changes to the business model are expected
to be infrequent. The Company''s senior management
determines change in the business model as a result
of external or internal changes which are significant
to the Company''s operations. Such changes are
evident to external parties. A change in the business
model occurs when the Company either begins or
ceases to perform an activity that is significant to
its operations. If the Company reclassifies financial
assets, it applies the reclassification prospectively
from the reclassification date which is the first day
of the immediately next reporting period following
the change in business model. The Company does
not restate any previously recognised gains, losses
(including impairment gains or losses) or interest.

Derivative financial instruments and hedge
accounting

Initial recognition and subsequent measurement

The Company uses derivative financial instruments,
such as forward currency contracts, to hedge its
foreign currency risks. Such derivative financial
instruments are initially recognised at fair value on
the date on which a derivative contract is entered
into and are subsequently re-measured at fair value.
Derivatives are carried as financial assets when the
fair value is positive and as financial liabilities when
the fair value is negative.

Any gains or losses arising from changes in the fair
value of derivatives are taken directly to profit or
loss, except for the effective portion of cash flow
hedges (if any), which is recognised in OCI and later
reclassified to profit or loss when the hedge item

affects profit or loss or treated as basis adjustment
if a hedged forecast transaction subsequently results
in the recognition of a non-financial asset or non¬
financial liability.

u. Fair value measurement

The Company measures financial instruments at fair value
at each balance sheet date.

Fair value is the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date.
The fair value measurement is based on the presumption
that the transaction to sell the asset or transfer the liability
takes place either:

- In the principal market for asset or liability, or

- In the absence of a principal market, in the most
advantageous market for the asset or liability.

The principal or the most advantageous market must be
accessible by the Company.

The fair value of an asset or liability is measured using
the assumptions that market participants would use
when pricing the asset or liability, assuming that market
participants act in their economic best interest.

A fair value measurement of a non- financial asset takes
into account a market participant''s ability to generate
economic benefits by using the asset in its highest and
best use or by selling it to another market participant that
would use the asset in its highest and best use.

The Company uses valuation techniques that are
appropriate in the circumstances and for which sufficient
data are available to measure fair value, maximising the
use of relevant observable inputs and minimizing the use
of unobservable inputs.

All assets and liabilities for which fair value is measured
or disclosed in the financial statements are categorized
within the fair value hierarchy, described as follows, based
on the lowest level input that is significant to the fair value
measurement as a whole:

Level 1- Quoted (unadjusted) market prices in active
markets for identical assets or liabilities

Level 2- Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
directly or indirectly observable

Level 3- Valuation techniques for which the lowest level
input that is significant to the fair value measurement
is unobservable

For assets and liabilities that are recognised in the
financial statements on a recurring basis, the Company
determines whether transfers have occurred between
levels in the hierarchy by re-assessing categorization
(based on the lowest level input that is significant to
fair value measurement as a whole) at the end of each
reporting period.

For the purpose of fair value disclosures, the Company has
determined classes of assets and liabilities on the basis of
the nature, characteristics and risks of the asset or liability
and the level of the fair value hierarchy as explained above.

i. Dividends

The Company recognises a liability to pay dividend to
equity holders of the Company when the distribution
is authorised, and the distribution is no longer at the

discretion of the Company. As per the corporate laws in
India, a distribution is authorised when it is approved by
the shareholders. A corresponding amount is recognised
directly in equity.

w. non-current assets held for sale

The Company classifies non-current assets and disposal
groups as held for sale if their carrying amounts will be
recovered principally through a sale rather than through
continuing use.

Non-current assets and disposal groups classified as
held for sale are measured at the lower of their carrying
amount and fair value less costs to sell. Costs to sell are
the incremental costs directly attributable to the disposal
of an asset (disposal group), excluding finance costs and
income tax expense.

The criteria for held for sale classification is regarded as met
only when the sale is highly probable, and the asset or disposal
group is available for immediate sale in its present condition.
Actions required to complete the sale/ distribution should
indicate that it is unlikely that significant changes to the sale
will be made or that the decision to sell will be withdrawn.
Management must be committed to the sale and the sale
expected within one year from the date of classification.

For these purposes, sale transactions include exchanges
of non-current assets for other non-current assets when
the exchange has commercial substance. The criteria for
held for sale classification is regarded met only when the
assets or disposal group is available for immediate sale in
its present condition, subject only to terms that are usual
and customary for sales of such assets (or disposal groups),
its sale is highly probable; and it will genuinely be sold,
not abandoned. The Company treats sale of the asset or
disposal group to be highly probable when:

- The appropriate level of management is committed to
a plan to sell the asset (or disposal group),

- Rn active programme to locate a buyer and complete
the plan has been initiated (if applicable),

- The asset (or disposal group) is being actively
marketed for sale at a price that is reasonable in
relation to its current fair value,

- The sale is expected to qualify for recognition as
a completed sale within one year from the date of
classification, and

- Actions required to complete the plan indicate that it
is unlikely that significant changes to the plan will be
made or that the plan will be withdrawn.

Property, plant and equipment and intangible are not
depreciated, or amortised assets once classified as held for
sale. Assets and liabilities classified as held for sale are
presented separately from other items in the balance sheet.

2.1 Significant accounting judgements, estimates and
assumptions

The preparation of the financial statements requires
management to make judgements, estimates and
assumptions that affect the reported amounts of revenues,
expenses, assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent liabilities.
Uncertainty about these assumptions and estimates could
result in outcomes that require a material adjustment to
the carrying amount of assets or liabilities affected in
future periods.

Judgements

In the process of applying the Company''s accounting
policies, there are no significant judgements established
by the management.

Revenue from contracts with customers

The Company applied the following judgements that
significantly affect the determination of the amount and
timing of revenue from contracts with customers:

Determining method to estimate variable consideration
and assessing the constraint

Certain contracts for the sale of goods include volume
rebates that give rise to variable consideration. In
estimating the variable consideration, the Company is
required to use either the expected value method or
the most likely amount method based on which method
better predicts the amount of consideration to which it
will be entitled.

In estimating the variable consideration for the sale of
goods with volume rebates, the Company determined that
using a combination of the most likely amount method and
expected value method is appropriate. The selected method
that better predicts the amount of variable consideration
was primarily driven by the number of volume thresholds
contained in the contract. The most likely amount method
is used for those contracts with a single volume threshold,
while the expected value method is used for contracts with
more than one volume threshold.

Before including any amount of variable consideration
in the transaction price, the Company considers whether
the amount of variable consideration is constrained.
The Company determined that the estimates of variable

consideration are not constrained based on its historical
experience, business forecast and the current economic
conditions. In addition, the uncertainty on the variable
consideration will be resolved within a short time frame.

Estimates and assumptions

The key assumptions concerning the future and other
key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described
below. The Company based its assumptions and estimates
on parameters available when the financial statements
were prepared. Existing circumstances and assumptions
about future developments, however, may change due to
market changes or circumstances arising that are beyond
the control of the Company. Such changes are reflected in
the assumptions when they occur.

Useful life of property, plant and equipment

The Company uses its technical expertise along with
historical and industry trends for determining the economic
life of an asset/component of an asset. The useful lives
are reviewed by management periodically and revised,
if appropriate. In case of a revision, the unamortised
depreciable amount is charged over the remaining useful
life of the assets.

- Defined benefit plans

The cost of the defined benefit gratuity plan and other
post-employment defined benefits are determined
using actuarial valuations. An actuarial valuation
involves various assumptions that may differ from
actual developments in the future. These include
the determination of the discount rate, future salary
increases and mortality rates. Due to the complexities
involved in the valuation and its long-term nature,
a defined benefit obligation is highly sensitive to
changes in these assumptions. All assumptions are
reviewed at each reporting date. Further details
about gratuity obligations are given in Note 30.

- Leases

The Company has several lease contracts that include
extension and termination options. These options
are negotiated by management to provide flexibility
in managing the leased-asset portfolio and align
with the Company''s business needs. Management
exercises significant judgement in determining
whether these extension and termination options are
reasonably certain to be exercised.

- Provisions and Contingencies

The assessments undertaken in recognising provisions
and contingencies have been made in accordance
with the applicable Ind RS. R provision is recognized
if, as a result of a past event, the Company has a
present legal or constructive obligation that can be
estimated reliably, and it is probable that an outflow
of economic benefits will be required to settle the
obligation. Where the effect of time value of money
is material, provisions are determined by discounting
the expected future cash flows. The Company has
significant capital commitments in relation to various
capital projects which are not recognized on the
balance sheet. In the normal course of business,
contingent liabilities may arise from litigation and
other claims against the Company. Guarantees are
also provided in the normal course of business.
There are certain obligations which management
has concluded, based on all available facts and
circumstances, are not probable of payment or are
very difficult to quantify reliably, and such obligations
are treated as contingent liabilities and disclosed
in the notes but are not reflected as liabilities in
the financial statements. Rlthough there can be no
assurance regarding the final outcome of the legal
proceedings in which the Company is involved, it is
not expected that such contingencies will have a
material effect on its financial position or profitability.

- Taxes

Uncertainties exist with respect to the interpretation
of complex tax regulations, changes in tax laws, and
the amount and timing of future taxable income.
Given the nature of business differences arising
between the actual results and the assumptions
made, or future changes to such assumptions, could
necessitate future adjustments to tax income and
expense already recorded. The Company establishes
provisions, based on reasonable estimates. The
amount of such provisions is based on various
factors, such as experience of previous tax audits

and different interpretations of tax regulations by
the taxable entity and the responsible tax authority.
Such differences of interpretation may arise on a
wide variety of issues depending on the conditions
prevailing in the respective domicile of the companies.

2.2 new and amended standards

The Company applied for the first-time certain standards
and amendments, which are effective for annual periods
beginning on or after 1 April 2024. The Company has not
early adopted any standard, interpretation or amendment
that has been issued but is not yet effective.

(i) Ind AS 117 Insurance Contracts

The Ministry of Corporate Affairs (MCR) notified the
Ind RS 117, Insurance Contracts, vide notification
dated 12 August 2024, under the Companies (Indian
Accounting Standards) Amendment Rules, 2024,
which is effective from annual reporting periods
beginning on or after 1 April 2024.

Ind AS 117 Insurance Contracts is a comprehensive
new accounting standard for insurance contracts
covering recognition and measurement, presentation
and disclosure. Ind AS 117 replaces Ind AS 104
Insurance Contracts. Ind AS 117 applies to all types of
insurance contracts, regardless of the type of entities
that issue them as well as to certain guarantees and
financial instruments with discretionary participation
features; a few scope exceptions will apply. Ind AS
117 is based on a general model, supplemented by:

• A specific adaptation for contracts with direct
participation features (the variable fee approach)

• A simplified approach (the premium allocation
approach) mainly for short-duration contracts

The application of Ind AS 117 does have impact on the
Company''s financial statements as the Company has
not entered any contracts in the nature of insurance
contracts covered under Ind AS 117.

(ii) Amendments to Ind AS 116 Leases - Lease Liability
in a Sale and Leaseback

The MCA notified the Companies (Indian Recounting
Standards) Second Amendment Rules, 2024, which
amend Ind AS 116, Leases, with respect to Lease
Liability in a Sale and Leaseback.

The amendment specifies the requirements that a
seller-lessee uses in measuring the lease liability
arising in a sale and leaseback transaction, to ensure
the seller-lessee does not recognise any amount of the
gain or loss that relates to the right of use it retains.

The amendment is effective for annual reporting periods
beginning on or after 1 April 2024 and to be applied
retrospectively to sale and leaseback transactions entered
into after the date of initial application of Ind AS 116.

The amendments do not have a impact on the
Company''s financial statements as company has not
entered into an sale and lease back transaction.

2.3 The management considering the relevant events after
the reporting date has evaluated the likely impact
of prevailing uncertainties relating to imposition or
enhancement of reciprocal tariffs and believes that there
are no material impacts on the financial statements of the
Company for the year ended March 31, 2025. However,
the management will continue to monitor the situation
from the perspective of potential impact on the operations
of the Company.

2.4 Standards notified but not yet effective

There are no standards that are notified and not yet
effective as on date.

nature and description of reserve

a. Capital Reserve - The Company recognized profit or loss on cancellation of Companies own equity instruments to capital reserve.

b. General Reserve - General reserves are free reserves of the Company which are kept aside out of Company''s profits to meet the
future requirements as and when they arise.

c. Share based payment reserves - The Company has a stock option scheme under which options to subscribe for the Company''s
shares have been granted to certain executives and senior employees. The share-based payment reserve is used to recognise
the value of equity-settled share-based payments provided to employees, including key management personnel, as part of their
remuneration. Refer to Note 36 for further details of these plans.

d. Retained Earnings - Retained earnings are the accumulated profits earned by the Company till date, less transfer to general
reserves, dividend and other distributions made to the shareholders.

e. Securities Premium - Securities premium represents premium on issue of shares. It will be utilised in accordance with the
provisions of the Companies Act, 2013.

Above sensitivity analysis is based on a change in assumption while holding all the other assumptions constant. In practice,
this is unlikely to occur, and change in some of the assumptions may be correlated. When calculating the sensitivity of
the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit
obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when
calculating the defined benefit liability recognised in balance sheet.

x. Risk exposure

The gratuity scheme is a final salary Defined Benefit Plan that provides for lump sum payment made on exit either by way
of retirement, death, disability or voluntary withdrawal. The benefits are defined on the basis of final salary and the period
of service and paid as lump sum at exit. Valuations are based on certain assumptions, which are dynamic in nature and
vary over time. As such company is exposed to various risks as follow :

a) 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 the above benefit and will thus result in an increase in the value
of the liability.

b) Salary inflation risk: Higher than expected increases in salary will increase the defined benefit obligation.

c) Investment risk: If Plan is funded then assets liabilities mismatch and actual investment return on assets lower than
the discount rate assumed at the last valuation date can impact the liability.

d) Demographic risk: This is the risk of variability of results due to unsystematic nature of decrements that include
mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is
not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria .

e) Liquidity risk: This is the risk that the Company is not able to meet the short-term gratuity pay outs. This may
arise due to non availability of enough cash/cash equivalent to meet the liabilities or holding of illiquid assets not
being sold in time.

f) Regulatory risk: Gratuity benefits paid in accordance with the requirements of the Payment of Gratuity Act,1972 (as
amended from time to time).There is a risk of change in regulations requiring higher gratuity pay-outs (e.g. Increase
in the maximum limit on gratuity of H 20,00,000).

notes

’The demand raised by the tax authorities is mainly towards disallowance of availment of CEnVRT credit and classification of product
in different tax buckets.

²The demands raised by the tax authorities are mainly towards enhancement of turnover due to certain disallowances, ineligible
GST input credits and local sales tax/Goods and service Tax (GST) demands upon completion of assessment and various other
miscellaneous matters raised by the respective state and central authorities.

During the year, Company has received demand order/show cause notices of H 29.25 Crore with equal amount of penalty from the
Rnti Evasion section of the GST and Central Excise Department from the state of Maharashtra, Madhya Pradesh and Rndhra Pradesh
for the period from July 01, 2017 to July 17, 2022, where department has alleged import/purchase of goods at higher rate and sale at
lower rate of GST on account of wrong HSn (Harmonized system nomenclature) classification code and other matters.

In addition to these demand orders, the Company has also received Show cause notice (SCn) of H 2.87 Crores from the Assistant
Commissioner of Central Tax and Central Excise, Vijayawada, Rndhra Pradesh on similar ground for the period from April 2018 to July
2022 against which replies has been submitted by the Company and is pending with respective authority.

Further, the Company has tilled writ petition and appeal against the said orders in state of Madhya Pradesh and Rndhra Pradesh
respectively and the Company is in the process of tilling writ petition with High court ot Maharashtra against the demand order raised
from state ot Maharashtra.

Based on advice obtained from tax expert, management is confident that it has a strong case on merits and therefore, no adjustments
are required in these financial statements of the Company.

³During the year, the Company has received demand order of H 2.84 crores from the Office of Joint Commissioner, West Bengal for
the FY 2020-21 on account of worng/ineligible ITC availed and non reversal of ITC in case of purchase credit notes. The Company
has filed the appeal to Joint Commissioner (Appeal) against the said order. Based on advice obtained from tax expert, management is
confident that it has a strong case on merits and therefore, no adjustments are required in these financial statements of the Company.

⁴In the year 2017, upon closure of CFL unit at Faridabad, Haryana the Company had transferred 13 employees from Faridabad to
different office locations of the Company. The workers, challenged their transfer and termination before Industrial Tribunal-cum-
Labour Court -III, Faridabad (Haryana), which passed an order on April 30, 2024 under Section 10(1)(c) of Industrial Dispute Rct
awarding reinstatement and payment of back wages for 13 erstwhile workers who were in litigation with the Company. Rs per
impugned award, total back wages for these 13 workmen at the rate of 50% of their last drawn wages amounting to H 0.98 crores
is to be paid by the Company. During the year, the Company has filed the writ petition against this order in the High Court of Punjab
and Haryana and Hon''ble Court reduced the back wages to H 0.04 crore per workmen and directed reinstatement of 13 workmen vide
order dated July 29,2024.Company has complied with the said order and accordingly the necessary impact amounting to H 0.52 Crores
has been considered in these financial statement.

⁵Entry Tax (Haryana) - Supreme Court of India vide its order dated nov 11, 2016, upheld the right of State Government to impose
the entry tax, however on the question regarding validity of each State Legislation imposing entry tax, the bench decided to let the
issue be determined by regular High Court benches of the respective states, pending decision of High Court of Punjab & Haryana, the
impact, if any, was not ascertainable.

In current year December 2024, Haryana government issued Haryana Goods and Services Tax (Removal of Difficulties) Order, 2024
("ROD") to complete the pending proceedings under the Haryana Entry Tax and accordingly, post issuance of removal of difficulties
(ROD) order by Haryana government, Excise and Taxation Officer-cum-Rssessing Ruthority has issued show cause notices to the
Company for RY 2015-16 to 2017-18 amounting to H 33.75 crores in respects of goods brought into Haryana for consumption/use/
sale in the said period.

The Company has filed Writ petition before High court of Punjab & Haryana against these show cause notices. Based on legal advice
obtained from tax expert, management is confident that it has a strong case on merits and therefore, no adjustments are required in
these financial statements of the Company.

⁶In the year 2021, Company had received a demand from Haryana State Pollution Control Board (HSPCB) stating that alleged discharge
from its Faridabad factory was in violation of the consent limits/ prescribed standards. The Company challenged the demand in
High Court of Punjab and Haryana. The matter has been disposed off by Hon''ble High court and directing HSPCB to reconsider the
submission of Company under the modified policy of HSPCB. Subsequently, HSPCB has reduced the demand towards environment
compensation as per its modified policy from H 0.48 crore to H 0.11 Crore. However, in view of the aforesaid demand raised by HSPCB,
prosecution proceedings were initiated by HSPCB before the Magistrate Court, Faridabad, wherein summons were served on the
Company and its directors.

The summons were challenged by the Directors in High Court of Punjab and Haryana and the same has been stayed by the Hon''ble
High court and is currently pending adjudication. The management, including its legal advisors, believes that the ultimate outcome of
these proceedings will not have an adverse impact on the Company''s financial position and results of operation.

⁷The Company has pending export obligation on account of import duty exemption of H 1.18 crores (March 31, 2024:H 1.36 crores)
on capital goods imported under the Export Promotion Capital Goods (EPCG). The Company expects to fulfil the obligation in due
course of time.

B. Other Litigations

1. In respect of Kolkata plant where a portion of land (about 2 bigha) was taken on sub-lease by the Company, lease
agreement between owners of the said land and principal lessee expired in 1975. The owners filed eviction proceedings
against the principal lessee in 1976 and the suit was decided in favour of the owners in March 31, 2007. The Company
appealed against the same and vide interim order in May, 2007, the order of eviction and execution proceedings pursuant
to decree were stayed by Appellate Court, pending outcome of the appeal. However, pursuant to application by owners,
the Court directed the Company to deposit of H 60,000 Per month w.e.f. March 26, 2018 as occupational charges, which
continues to be disclosed as ''deposit'' under Note 5 of the financial statements. During the current year, Fast-Track Court
at Sealdah vide order dated June 15, 2024 has passed an order in which judgement dated March 31, 2007, passed against
the Company has been set aside and the appeal filed by the Company against the original order was allowed on contest.

In light of order received on Jun 15, 2024, Company did not make any occupational charges deposit in the court from
July 2024 month onwards. Rlso, on September 27, 2024, the Company filed an application in the Court for refund of
occupational charges paid till Jun 30,2024 amounting to H 0.45 crore and matter is adjourned till June 30, 2025.

During the year, Owners have filed appeal before Calcutta High Court against said order which is admitted and pending
for further hearing. Based on legal assessment from expert, management believes that no liability needs to be accrued for
rental expenses or decommissioning liabilities in the financial statements at this stage.

2. Other than above, the Company has certain litigations under Section 138 of Negotiable Instruments Rct, 2018 and trade
receivables against these cases has been provided for.

3. During the earlier years, order was passed by Hon''ble High Court of Delhi for alleged design infringement, where in the
Court had issued restraining order on the manufacturing, marketing, and selling of specific model of fans category by the
Company and proceedings are in progress and the matter is subjudice.

Further, during the year, another case has been filed against the Company for alleging infringement trademark before
Hon''ble High Court of Delhi. Hon''ble High court, after hearing the matter referred the same to mediation which did not
succeed and currently matter is pending before Hon''ble High Court for further adjudication.

The management, including its legal advisors, believes that the ultimate outcome of these proceedings will not have an
adverse impact on the Company''s financial position and results of operation.

C. Others

1. There are numerous interpretative issues relating to the Supreme Court judgement dated February 28, 2019 on Provident
Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability of effective date.
The Company is evaluating regarding various interpretative issues and its impact for the period before February 28, 2019
which in opinion of the management will not have material impact.

2. The Code on Social Security, 2020 (''code'') relating to employee benefits during employment and post-employment benefits
received Presidential assent in September 2020. The code has been published in the Gazette of India. However, the date
on which the code will come into effect has not been notified and the final rules/interpretation have not yet been issued.
The Company will assess the impact of the code when it comes into effect and will record any related impact in the period
the code and the related rules to determine the financial impact becomes effective.

3. The E-Waste (Management) Rules, 2022 issued by CPCB become applicable on the Company with effect from April 1, 2023.
In respect to same, Company has obtained the EPR authorisation under E-Waste (Management) Rules, 2022 from CPCB as
a Producer for certain category of products listed under the Schedule I of E-waste Rules and has partnered with third-party
waste management organizations for collection and disposal of e-waste. In the current year, the Company, has computed
its obligation on the past sales whose product life has expired in the current year amounting to H 19.70 (March 31, 2024:
H 18.60 crores) which has been recognized in these financial statements. The said obligation is based on the management''s
best estimates, and no further liability is anticipated to devolve upon the Company in this regard.

Rs per the expert opinion obtained, the Company will have an obligation to complete the Extended Producer Responsibility
targets in future years if it continues to remain market participant. Further, CPCB vide notification dated September 09,
2022, has issued guidelines for Environment Compensation under these rules. In accordance with these rules, CPCB

note 1: The remuneration to the key managerial personnel/others does not include the provisions made for gratuity and leave
benefits, as they are determined on an actuarial basis for the Company as a whole.

Note 2: Share based payment transactions included above relates to fair value of options granted to Key Management Personnel
under the ESOP scheme, that is amortised in the statement of Profit and Loss during the grant period until the Vesting of the shares
as per the scheme. (Refer note 13c)

35. Segment information

The segment reporting of the Company has been prepared in accordance with Ind AS-108, "Operating Segment" (specified under the
section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards) Rule 2015 (as amended from
time to time) and other relevant provision of the Act).

Operating segments are defined as components of an enterprise for which discrete financial information so available is evaluated
regularly by Chief Operating Decision Maker (CODM), in deciding how to allocate resources and assessing performance. Accordingly,
the Company has identified two reportable business segments based on its product and services as follows:

Electrical Consumer Durables - Consists of manufacture / purchase and sale of electric Fans - ceiling, portable and airflow, along
with components and accessories thereof, and Appliances- coolers, geysers and home appliances etc .

Lighting & Switchgear- Consists of manufacture / purchase and sale of Lights & Luminaries- LED, street lights etc. and Switchgears-
switches, MCB and Wires etc.

The CODM primarily uses a measure of revenue from operation and profit or loss to assess the performance of the operating segments
on monthly basis.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Within India and
Outside India Operations.

36. Share based payments

The Company has, vide special resolutions passed by postal ballot, effective from March 13, 2019, introduced and implemented ''Orient
Electric Employee Stock Option Scheme 2019'' ("ESOP Scheme"). The terms and broad framework of the ESOP Scheme has been
approved by the Board of Directors of the Company at their meeting held on January 28, 2019. Pursuant to

---

Mar 31, 2024

Rights, preferences and restrictions attached to shares

The Company has only one class of equity shares having par value of H 1 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend, if proposed by the Board of Directors, is subject to the approval of the shareholders in the Annual General Meeting, except in case of interim dividend.

In the event of liquidation of the Company, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

nature and description of reserve

a. Capital Reserve - The Company recognized profit or loss on cancellation of Companies own equity instruments to capital reserve.

b. General Reserve - General reserves are free reserves of the Company which are kept aside out of Company''s profits to meet the future requirements as and when they arise.

c. Share based payment reserves - The Company has a stock option scheme under which options to subscribe for the Company''s shares have been granted to certain executives and senior employees. The share-based payment reserve is used to recognise the value of equity-settled share-based payments provided to employees, including key management personnel, as part of their remuneration. Refer to Note 36 for further details of these plans.

d. Retained Earnings - Retained earnings are the accumulated profits earned by the Company till date, less transfer to general reserves, dividend and other distributions made to the shareholders.

e. Securities Premium - Securities premium represents premium on issue of shares. It will be utilised in accordance with the provisions of the Companies Act, 2013.

1. During the year, the Company has availed the facility of Trade Acceptances on Trade Receivable Discounting System (TReDs) and carries interest @ 6.49 % to 7.50% p.a. (March 31, 2023 carries interest @ 4.00% to 7.50% p.a.) and outstanding is repayable within a period of 45 days from the due date.

2. Loans and Borrowing has been utilised for the purpose it has been obtained.

a) Trade payables are non-interest bearing and normally settled on 0 to 90 day terms.

b) Trade Payables include due to related parties H 7.23 crores (March 31, 2023 : H 4.70 crores) (Refer note 34).

c) Trade payables include acceptances of H 95.02 crores (March 31, 2023: H 119.20 Crores). Acceptances represent arrangements where suppliers of goods and services are initially paid by the banks, while Company continues to recognize the liability till settlement with the banks, which are normally effected within a period of 89 days.

d) Ageing required as per schedule III is provided in note no. 47.

31. Employee benefits R. Defined Benefit Schemes Gratuity

The Company has a defined benefit gratuity plan. The gratuity plan is governed by The Payment of Gratuity Rct, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

Every employee is entitled to a benefit equivalent to fifteen days'' salary last drawn for each completed year of service in line with the Payment of Gratuity Rct, 1972. The same is payable at the time of separation from the Company or retirement, whichever is earlier. The benefits vest after five years of continuous service.

The following tables summarises the components of net benefit expense recognized in the Statement of Profit & Loss and the funded status and amounts recognised in the balance sheet for the plan :

Above sensitivity analysis is based on a change in assumption while holding all the other assumptions constant. In practice, this is unlikely to occur, and change in some of the assumptions may be correlated. When calculating the sensitivity of

the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in balance sheet.

x. Risk exposure

The gratuity scheme is a final salary Defined Benefit Plan that provides for lump sum payment made on exit either by way of retirement, death, disability or voluntary withdrawal. The benefits are defined on the basis of final salary and the period of service and paid as lump sum at exit. Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such company is exposed to various risks as follow :

a) 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 the above benefit and will thus result in an increase in the value of the liability.

b) Salary inflation risk: Higher than expected increases in salary will increase the defined benefit obligation.

c) Investment risk: If Plan is funded then assets liabilities mismatch and actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.

d) Demographic risk: This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria .

e) Liquidity risk: This is the risk that the Company is not able to meet the short-term gratuity pay outs. This may

arise due to non availability of enough cash/cash equivalent to meet the liabilities or holding of illiquid assets not

being sold in time.

f) Regulatory risk: Gratuity benefits paid in accordance with the requirements of the Payment of Gratuity Act,1972 (as amended from time to time).There is a risk of change in regulations requiring higher gratuity pay-outs (e.g. Increase in the maximum limit on gratuity of H 20,00,000).

B. Defined Contribution Plan :

The Company deposits an amount determined at a fixed percentage of basic pay every month to the State administered

Provident Fund, Employee State Insurance (ESI) and Superannuation Fund for the benefit of the employees.

33. Contingent liabilities
R. Demands/claims by various Government authorities and others not acknowledged as debts and contested/to be contested by the Company:	March 31, 2024	March 31, 2023
1. Excise and Custom Duty1	1.64	1.64
2. Sales Tax (incl. GST & entry tax)2	5.29	6.37
3. Worker compensation under dispute3	1.09	0.21
4. Entry tax4	Amount Unascertainable
5. Environment Compensation (paid 50% demand under protest)5	0.11	0.48
6. Export Promotion Capital Goods (EPCG)6	1.36	0.27
	9.49	8.97

notes

''The demand raised by the tax authorities is mainly towards disallowance of availment of CENVAT credit and classification of product in different tax buckets.

²The demands raised by the tax authorities are mainly towards enhancement of turnover due to certain disallowances, and local sales tax demand upon completion of assessment and various other miscellaneous cases raised by the respective state authorities. Entry Tax (West Bengal) - In respect to litigation towards Entry tax (West Bengal), in current year, the company has opted for Settlement of dispute scheme, 2023 (West Bengal), whereby the demand against Entry Tax for FY 2013-14 to FY 2017-18 has been settled. As part of scheme, H 1.69 crores has been paid against the total demand of H 4.96 crores (including interest of H 1.56 crores) and balance liability recorded in books of accounts amounting to H 1.73 crores has been written back.

³In the year 2017, upon closure of CFL unit at Faridabad, Haryana the Company had transferred 13 employees from Faridabad to different office locations of Company. The workers, challenged their transfer and termination before Industrial Tribunal-cum-Labour Court -III, Faridabad (Haryana), which passed an order on April 30, 2024 under section 10(1)(c) of Industrial Dispute Act owording reinstatement ond payment of bock woges for 13 erstwhile workers who were in litigation

with the Company. As per impugned award, total back wages for these 13 persons at the rate of 50% of their last drawn wages amounts to H 0.98 crores is to be paid by the Company. The Company is in the process of filing appeal/writ petition against this order in the High Court of Punjab and Haryana. Management believes that the ultimate outcome of this proceeding will not have a material impact on the Company''s financial position.

⁴Entry Tax (Haryana) - Supreme Court of India vide its order dated Nov 11, 2016, upheld the right of State Government to impose the entry tax, however on the question regarding validity of each State Legislation imposing entry tax, the bench decided to let the issue be determined by regular High Court benches of the respective states. Pending decision of High Court of Punjab & Haryana, the impact, if any, is not ascertainable at this stage and hence no provision is considered in the financial statements.

⁵In the year 2021, Company had received a demand from Haryana State Pollution Control Board (HSPCB) stating that alleged discharge from its Faridabad factory was in violation of the consent limits/ prescribed standards. The Company challenged the demand in High Court of Punjab and Haryana. The matter has been disposed of, directing HSPCB to reconsider the submission of Company under the modified policy of HSPCB. In current year, HSPCB has reduced the demand towards environment compensation as per its modified policy from H 0.48 crore to H 0.11 Crore.

However, in view of the aforesaid demand raised by HSPCB, prosecution proceedings were initiated by HSPCB before the Magistrate Court, Faridabad, wherein summons were served on the Company and its directors. The summons have been challenged by the Company in High Court of Punjab and Haryana and the same is stayed by the Hon''ble court and is currently pending adjudication.

⁶The Company has pending export obligation on account of import duty exemption of H 1.36 crores (March 31, 2023:H 0.27 crores) on capital goods imported under the Export Promotion Capital Goods (EPCG). The Company expects to fulfil the obligation in due course of time.

No expenses has been accrued in the financial statements for the demands raised. Management believes that the ultimate outcome of this proceeding will not have an adverse impact on the Company''s financial position and results of operation.

B. Other Litigations

1. During the earlier years, the Company had initiated legal action against Orient General Agencies (Bombay) Pvt Ltd ("OGA") and Apollo Supply Chain Private Limited (formerly Alco Logistics Private Limited) ("Apollo") for recovery of outstanding amount against which impairment allowance of H 14.07 crores was already considered in books of accounts.

During the previous year ended March 31, 2023, Company, OGA and Apollo have made out of Court settlement of all the disputes between them and as per the terms of settlement OGA and Apollo have paid amount of H 3 crores and H 2.75 crores respectively as a full and final settlement towards recoveries under invoices raised against OGA as well as

satisfaction of all damages, losses and claims raised by Company and counter claims by OGR and Rpollo, in various courts across the country and thereby, all litigations filed by respective parties stands withdrawn/closed. Accordingly, an amount of H 8.32 crores of trade receivables was adjusted against impairment allowance of H 14.07 crores and amount of H 5.75 crores was considered as ''Other income'' in the financial statement for the year ended March 31, 2023.

2. In respect of Kolkata plant where a portion of land (about 2 bigha) was taken on sub-lease by the Company, lease agreement between owners of the said land and principal lessee expired in 1975. The owners filed eviction proceedings against the principal lessee in 1976 and the suit was decided in favour of the owners in Mar, 2007. The Company appealed against the same and vide interim order in May, 2007, the order of eviction and execution proceedings pursuant to decree were since stayed by Appellate Court, pending outcome of the appeal. However, pursuant to application by owners, the Court directed the Company to deposit of H 60,000 p.m. w.e.f. 26th Mar, 2018 as occupational charges, which continues to be disclosed as ''deposit'' under note 5 of the financial statements. The appeal is currently at the final hearing stage by the Fast Track Court at Sealdah. Based on expert legal assessment, management believes that no liability needs to be accrued for rental expenses or decommissioning liabilities in the financial statements at this stage.

3. Other than above, the Company has certain litigations under Section 138 of negotiable Instruments Rct, 2018 and trade receivables against these cases has been provided for.

4. During the earlier year, two separate orders were passed by Hon''ble High Court of Delhi for alleged design infringement, where in one of the case, the Court had issued restraining order on the manufacturing, marketing, and selling of specific model of fans category by the Company and proceedings are in progress and the matter is subjudice.

Further, during the year, in respect to another matter, Company and other party through process of Mediation, have made out of court settlement of all the disputes between them and as per the terms of settlement, all claims and counter claims between Company and other party has been withdrawn.

The management, including its legal advisors, believes that the ultimate outcome of these proceedings will not have an adverse impact on the Company''s financial position and results of operation.

C. Others

1. There are numerous interpretative issues relating to the Supreme Court judgement dated February 28, 2019 on Provident Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability of effective date. The Company is evaluating regarding various interpretative issues and its impact for the period before February 28, 2019.

2. The Code on Social Security, 2020 (''code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The code has been published in the Gazette of India. However, the date on which the code will come into effect has not been notified and the final rules/interpretation have not yet been issued. The Company will assess the impact of the code when it comes into effect and will record any related impact in the period the code and the related rules to determine the financial impact becomes effective.

3. The E-Waste (Management) Rules, 2022 issued by CPCB become applicable on the Company with effect from April 1, 2023. In respect to same, Company has obtained the EPR authorisation under E-Waste (Management) Rules, 2022 from CPCB as a Producer for certain category of products listed under the Schedule I of E-waste Rules and has partnered with third-party waste management organizations for collection and disposal of e-waste. In the current year, the Company, , has computed its obligation on the past sales whose product life has expired in the current year amounting to H 18.60 crores which has been recognized in these financial statements. The said obligation is based on the management''s best estimates, and no further liability is anticipated to devolve upon the Company in this regard.

Further as per the expert opinion obtained, the Company will have an obligation to complete the Extended Producer Responsibility targets in future years if it continues to remain market participant.

note 1: The remuneration to the key managerial personnel / others does not include the provisions made for gratuity and leave benefits, as they are determined on an actuarial basis for the Company as a whole.

Note 2: Share based payment transactions included above relates to fair value of options granted to Key Managerial Personnel under the ESOP scheme, that is amortised in the Profit & Loss during the grant period until the Vesting of the shares as per the scheme. (Refer Note 13c)

Note 3: Net off reversal of Long term performance cash incentive (Refer Note 25)

35. Segment information

The segment reporting of the Company has been prepared in accordance with Ind RS-108, "Operating Segment” (specified under the section 133 of the Companies Rct 2013 (the Rct) read with Companies (Indian Accounting Standards) Rule 2015 (as amended from time to time) and other relevant provision of the Rct).

Operating segments are defined as components of an enterprise for which discrete financial information so available is evaluated regularly by Chief Operating Decision Maker (CODM), in deciding how to allocate resources and assessing performance. Accordingly, the Company has identified two reportable business segments based on its product and services as follows:

(i) Electrical Consumer Durables - Consists of manufacture / purchase and sale of electric Fans - ceiling, portable and airflow, along with components and accessories thereof, and Rppliances- coolers, geysers and home appliances etc.

(ii) Lighting & Switchgear- Consists of manufacture / purchase and sale of Lights & Luminaries- LED, street lights etc. and Switchgears- switches & MCB etc.

The CODM primarily uses a measure of revenue from operation and profit or loss to assess the performance of the operating segments on monthly basis.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Within India and Outside India Operations.

Unallocated

Revenue, expenses, assets and liabilities have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue, expenses, assets and liabilities which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed under unallocated.

36. Share based payments

The Company has, vide special resolutions passed by postal ballot, effective from March 13, 2019, introduced and implemented ''Orient Electric Employee Stock Option Scheme 2019'' ("ESOP Scheme"). The terms and broad framework of the ESOP Scheme has been approved by the Board of Directors of the Company at their meeting held on January 28, 2019. Pursuant to the provisions of Section 62(1)(b) and all other applicable provisions, if any, of the Companies Act, 2013 (the "Act") and the Companies (Share Capital and Debenture) Rules, 2014 read along with the provisions of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (SEBI ESOP Regulations), the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations"), the nomination and Remuneration Committee ("Remuneration Committee") of the Board of Directors of the Company is authorised to implement and administer the ESOP Scheme - 2019. The ESOP Scheme has been formulated in accordance with the SEBI ESOP Regulations.

Under the ESOP Scheme, the eligible employees shall be granted employee Stock Options in the form of Options ("Stock Options") which will be exercisable into equal number of equity shares of H 1/- each of the Company.

Details of the ESOP Scheme:

a) Exercise Price: Market Price of equity share as on the previous close rate on the Stock Exchange immediately preceding the date of the grant.

b) Vesting Period :

(i) Grant 1 to 3 : 40% of options shall vest after 3 years from grant date and 60% of options shall vest after 4 years from grant date.

(ii) Grant 4 to 6: 40% of options shall vest after 2 years from grant date and 60% of options shall vest after 3 years from grant date.

(iiii) Grant 7: 33.33 % of options shall vest every year upto 3 years from grant date.

c) Exercise Period: 4 years post vesting.

d) Method of settlement: Equity.

e) Vesting conditions: Employee remaining in the employment of the Company during the vesting period.

In exercise of the powers, Remuneration Committee has, during the year granted a total of 11,17,387(March 31, 2023: 3,40,924) new Stock Options to eligible employees of the Company as per ESOP Scheme- 2019, while 431,961 (March 31, 2023 : 2,20,017) Stock Options, granted in earlier years have been lapsed on account of separation of employee from the company.

37. Leases Rs a lessee

The Company has lease contracts for various Properties (e.g. Corporate office, Depots, Plants, Warehouse etc), leased lines, office equipment''s etc used in its operations. Leases of property generally have lease terms between 2 to 10 years. The Company''s obligations under its leases are secured by the lessor''s title to the leased assets. Generally, the Company is restricted from assigning and subleasing the leased assets. There are several lease contracts that include extension and termination options which are further discussed below.

The Company also has certain leases of property and machinery with lease terms of 12 months or less and leases of office equipment with low value. The Company applies the ''short-term lease'' and ''lease of low-value assets'' recognition exemptions for these leases.

Set out below are the carrying amounts of right-of-use assets recognised and the movements during the period:

The Company had total cash outflows for leases of H 35.39 crores in March 31, 2024 (March 31, 2023: H 27.61 crores). The Company also had non-cash additions to right-of-use assets and lease liabilities of H 33.80 crores as at March 31, 2024 (March 31, 2023: H 61.53 crores).

The Company has several lease contracts that include extension and termination options. These options are negotiated by management to provide flexibility in managing the leased-asset portfolio and align with the Company''s business needs. Management exercises significant judgement in determining whether these extension and termination options are reasonably certain to be exercised.

Management expects that the entire transaction price allotted to the unsatisfied contract as at the end of the reporting period will be recognised as revenue during the next financial year.

In some contracts, the Company provides warranty to the customers as per the contract. The warranty is accounted for as a separate performance obligation and a portion of the transaction price is allocated. The performance obligation for the warranty service is satisfied based on time elapsed.

40. Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, and trade and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s financial assets include trade and other receivables, cash and cash equivalents and security deposits that derives directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company has a Risk management policy and its management is supported by a Risk management committee that advises on risks and the appropriate financial risk governance framework for the Company. The Risk management committee provides assurance to the Company''s management that the Company''s risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk, such as commodity price risk and equity price risk. Financial instruments affected by market risk include trade payables, trade receivables, borrowings, etc.

Commodity price risk

The Company is affected by the price volatility of certain commodities. Its operating activities require the ongoing manufacture of electronic items and therefore require a continuous supply of copper and aluminium being the major input used in the manufacturing. Due to the significantly increased volatility of the price of the Copper and aluminium, the Company has entered into various purchase contracts for these material for which there is an active market. The Company maintain the level of these stocks as per the requirement of businesses and market which are discussed by the management on regular basis. Company operates in the way that saving/impact due to change in commodity price are pass on to the customers and therefore impact on profit due to change in price of commodity is unascertainable.

Interest rate risk

The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s debt obligations with floating interest rates. The Company''s borrowings outstanding as at March 31, 2024 comprise of fixed rate loans and accordingly, are not expose to risk of fluctuation in market interest rate.

Foreign currency risk

The Company''s exposure to foreign currency arises where a Company holds monetary assets and liabilities denominated in a currency different to the functional currency of that entity with Indian rupees (INR) . Set out below is the impact of a 5% change in the INR on profit and equity arising as a result of the revaluation of the Company''s foreign currency financial instruments. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year end for a 5% change in foreign currency rates. For a 5% strengthing/weakening of the INR against the relevant currency, there would be a comparable negative/positive impact on the profit or equity, as applicable.

Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables).

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made in the bank deposits and overnight debt mutual funds. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through counter party''s potential failure to make payments.

The Company''s maximum exposure to credit risk for the components of the balance sheet at March 31, 2024 and March 31, 2023 is the carrying amounts . Trade Receivables and other financial assets are written off when there is no reasonable expectation of recovery, such as debtor failing to engage in the repayment plan with the Company. The Company''s maximum exposure relating to financial assets is noted in liquidity table below.

Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations or at a reasonable price. The Company''s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company''s net liquidity position through rolling forecasts on the basis of expected cash flows.

The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of cash credits, bank loans among others.

Maturity profile of Financial liabilities

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.

41. Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders. The primary objective of the Company''s capital management is to maximise the shareholder value and keep the debt equity ratio within acceptable range.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders and issue new shares.

43. Corporate Social Responsibility

Rs per provisions of section 135 of the Companies Rct, 2013, read alongwith the Rules made thereunder and Schedule VII thereto, the Company has to incur at least 2% of average net profits, as per section 198 of the Companies Act, 2013, of the preceding three financial years towards Corporate Social Responsibility ("CSR"). Accordingly, the Company has spent a sum of H 2.95 crores (March 31, 2023: H 3.02 crores) towards CSR activities as approved by the Board of Directors on the recommendations of CSR committee of the Company. This amount has been charged to the Statement of Profit Rnd Loss.

The management assessed that bank balances, trade receivables, trade payables, short term borrowings and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

1. The fair values of the interest-bearing borrowings and loans are determined by using DCF method using discount rate that reflects the Company''s borrowing rate as at the end of the reporting period. The own non-performance risk as at March 31, 2024 was assessed to be insignificant.

2. Long-term receivables/payables are evaluated by the Company based on parameters such as interest rates, risk factors, individual creditworthiness of the counterparty and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy together with a quantitative sensitivity analysis as at March 31, 2024, are as shown below:

Fair value hierarchy

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques that use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

48. In previous year, Board of Directors of the Company had accorded their in -principal approval for disposal of land parcel at Hyderabad, total admeasuring 1,11,320 Sq.yards (hereinafter referred as "Land").In accordance with Ind AS 105 "Non-Current Assets Held For Sale and Discontinued Operations" the said land was classified as ''Asset held for sale'' as the carrying amounts of such asset is to be recovered principally through sales transaction rather than continuing use.

In Current year, company has executed the sale of said land for net consideration of H 34.80 crores and accordingly, profit on sale of land of H 18.68 crores has been disclosed as an exceptional item in current year financial statement.

49. Other Statutory information

(i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

(ii) The Company does not have any transactions with companies struck off under section 248 of Companies Act, 2013.

(iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

(v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities

(Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(vii) The Company has not undertaken any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961.

50. During the year pursuant to a detailed assessment by an external expert, as per the provision of GST the Company has voluntarily recognized GST liability on interest income charged from customers on delayed payment for the period from July 01, 2017 to March 31, 2023. Accordingly, GST liability of H 4.18 crores including interest of H 1.59 crores has been recognised as on March 31, 2024 and the same has been paid subsequently. Further, out of the total liability, H 1.19 crores will be recovered from the customers and the balance amount of H 2.99 crores has been debited in the statement of profit and loss. No further liability is expected to devolve in this regard.

51. The Company uses accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software, except that audit trail feature is not enabled for direct changes to data for users with certain privileged access rights to the accounting software (SAP S4 Hana application) and the underlying database. Further, certain features of the audit trail to record direct changes in application was temporarily disabled during the year. However, there are no instance of audit trail being tampered during the year.

52. The figures have been rounded off to the nearest crore of rupees upto two decimal places. The figure 0.00 wherever stated represents value less than H 50,000/-.

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Mar 31, 2023

a) no trade receivables are due from directors or other officers of the Company either severally or jointly with any other person. nor any trade receivables are due from firms or private companies respectively in which any director is a partner, a director or a member.

b) Trade receivables are generally non-interest bearing.

c) Trade Receivables include due from related parties H 0.22 crores (March 31, 2022: H 0.02 crores) (Refer note 33)

d) Ageing required as per schedule III is provided in note no. 45.

note: There are no repatriation restrictions with regards to cash and cash equivalents as at the end of the reporting period and prior periods.

The undrawn committed borrowing facilities as of reporting date is H nil (31 March 2022 H nil)

a) Rights, preferences and restrictions attached to shares

The Company has only one class of equity shares having par value of H 1 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend, if proposed by the Board of Directors, is subject to the approval of the shareholders in the Annual General Meeting, except in case of interim dividend.

In the event of liquidation of the Company, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

nature and description of reserve

a. Capital Reserve - The Company recognized profit or loss on cancellation of Companies own equity instruments to capital reserve.

b. General Reserve - General reserves are free reserves of the Company which are kept aside out of Company''s profits to meet the future requirements as and when they arise. The Company had transferred a portion of the profit after tax (PAT) to general reserve pursuant to the earlier provisions of Companies Act, 1956. Mandatory transfer to general reserve is not required under the Companies Act, 2013.

c. Share based payment reserves - The Company has a stock option scheme under which options to subscribe for the Company''s shares have been granted to certain executives and senior employees. The share-based payment reserve is used to recognise the value of equity-settled share-based payments provided to employees, including key management personnel, as part of their remuneration. Refer to Note 35 for further details of these plans.

d. Retained Earnings - Retained earnings are the accumulated profits earned by the Company till date, less transfer to general reserves, dividend and other distributions made to the shareholders.

e. Securities Premium - Securities premium represents premium on issue of shares. It will be utilised in accordance with the provisions of the Companies Act, 2013.

1. During the year, the Company has availed the facility of Trade Acceptances on Trade Receivable Discounting System (TReDs) and carries interest @ 4.90% to 7.20% p.a. (March 2022 carries interest @ 4.00% to 7.00% p.a.) and outstanding is repayable within a period of 45 days from the due date.

2. Loans and Borrowing has been utilised for the purpose it has been obtained.

3. Company is having sanctioned working capital limits in excess of H 5.00 crore in aggregate from banks during FY-22-23 on the basis of security of current assets of the Company and all quarterly statements of current assets filed by the Company with banks during the year are in agreement with the unaudited books of accounts except for the following quarter:

a) Trade payables are non-interest bearing and normally settled on 0 to 90 day terms.

b) Trade Payables include due to related parties H 4.70 crores (March 31, 2022 : H 4.89 crores) (Refer note 33).

c) Trade payables include acceptances of H 119.20 Crores (March 31, 2022: H 128.96 Crores). Acceptances represent arrangements where suppliers of goods and services are initially paid by the banks, while Company continues to recognize the liability till settlement with the banks, which are normally effected within a period of 89 days.

d) Ageing required as per schedule III is provided in note no. 46.

30. Employee benefits

A. Defined Benefit Schemes Gratuity

The Company has a defined benefit gratuity plan. The gratuity plan is governed by The Payment of Gratuity Rct, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

Every employee is entitled to a benefit equivalent to fifteen days'' salary last drawn for each completed year of service in line with the Payment of Gratuity Rct, 1972. The same is payable at the time of separation from the Company or retirement, whichever is earlier. The benefits vest after five years of continuous service.

The following tables summarises the components of net benefit expense recognized in the Statement of Profit & Loss and the funded status and amounts recognised in the balance sheet for the plan :

The weighted average duration of the defined benefit obligation as at March 31, 2023 is 5 years (March 31, 2022: 5 years) .

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled.

f) Regulatory risk: Gratuity benefits paid in accordance with the requirements of the Payment of Gratuity Act,1972 (as amended from time to time). There is a risk of change in regulations requiring higher gratuity pay-outs (e.g. Increase in the maximum limit on gratuity of H 20,00,000).

B. Defined Contribution Plan:

The Company deposits an amount determined at a fixed percentage of basic pay every month to the State administered Provident Fund, Employee State Insurance (ESI) and Superannuation Fund for the benefit of the employees.

Above sensitivity analysis is based on a change in assumption while holding all the other assumptions constant. In practice, this is unlikely to occur, and change in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in balance sheet.

x. Risk exposure

The gratuity scheme is a final salary Defined Benefit Plan that provides for lump sum payment made on exit either by way of retirement, death, disability or voluntary withdrawal. The benefits are defined on the basis of final salary and the period of service and paid as lump sum at exit. Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such company is exposed to various risks as follow :

a) 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 the above benefit and will thus result in an increase in the value of the liability.

b) Salary inflation risk: Higher than expected increases in salary will increase the defined benefit obligation.

c) Investment risk: If Plan is funded then assets liabilities mismatch and actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.

d) Demographic risk: This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria .

e) Liquidity risk: This is the risk that the Company is not able to meet the short-term gratuity pay outs. This may arise due to non availability of enough cash/cash equivalent to meet the liabilities or holding of illiquid assets not being sold in time.

notes:

* The demand raised by the tax authorities is mainly towards disallowance of availment of CEhVAT credit and classification of product in different tax buckets.

** The demands raised by the tax authorities are mainly towards enhancement of turnover due to certain disallowances, and local sales tax demand upon completion of assessment and various other miscellaneous cases raised by the respective state authorities. Entry Tax (West Bengal) - State Government reintroduced entry tax w.e.f. April 1, 2012, whereby a dealer is required to pay entry tax for importing goods from outside the State. Liability recorded in the books for Mar 2014 to Jun 2017 is H 3.42 crores (till GST implementation date). The Company also has received a demand for interest of H 1.56 crores in this regard which has not been provided in the books, as the Company believes that the probability of interest waiver is high, basis the order from single judge of Calcutta High Court who struck down the low stating it os unconstitutional. We hove filed o writ in Hon''ble Calcutta High Court challenging the constitutional validity of the Act, which is pending finalisation.

*** Entry Tax (Haryana) - Supreme Court of India vide its order dated hov 11, 2016, upheld the right of State Government to impose the entry tax, however on the question regarding validity of each State Legislation imposing entry tax, the bench decided to let the issue be determined by regular High Court benches of the respective states. Pending decision of High Court of Punjab & Haryana, the impact, if any, is not ascertainable at this stage and hence no provision is considered in the financial statements.

**** In the year 2021, Company had received a demand from Haryana State Pollution Control Board (HSPCB) stating that alleged discharge from its Faridabad factory was in violation of the consent limits/ prescribed standards. The Company challenged the demand in High Court of Punjab and Haryana. The matter has been disposed of, directing HSPCB to reconsider the submission of Company under the modified policy of HSPCB. However, in view of the aforesaid demand raised by HSPCB, prosecution proceedings have been initiated by HSPCB before the Magistrate Court, Faridabad, wherein summons have been served on the Company and its directors. The summons have been challenged by the Company in High Court of Punjab and Haryana and the same is stayed by the Honbl''e court and is currently pending adjudication.

no expenses has been accrued in the financial statements for the demands raised. Management believes that the ultimate

outcome of this proceeding will not have a material adverse impact on the Company''s financial position and results of operation.

B. Other Litigations

1. During the earlier years, the Company had initiated legal action against Orient General Agencies (Bombay) Pvt Ltd ("OGA") and Apollo Supply Chain Private Limited (formerly Alco Logistics Private Limited) ("Apollo") for recovery of outstanding amount against which impairment allowance of H 14.07 crores was already considered in books of accounts.

During the year ended March 31, 2023, Company, OGA and Apollo have made out of Court settlement of all the disputes between them and as per the terms of settlement OGA and Apollo have paid amount of H 3 crores and H 2.75 crores respectively as a full and final settlement towards recoveries under invoices raised against OGA as well as satisfaction of all damages, losses and claims raised by Company and counter claims by OGA and Apollo, in various courts across the country and thereby, all litigations filed by respective parties stands withdrawn/closed. Accordingly, an amount of H 8.32 crores of trade recievables has been adjusted against impairment allowance of H 14.07 crores and amount of H 5.75 crores has been considered as ''Other income'' in the financial statement for the year ended March 31, 2023."

2. In respect of Kolkata plant where a portion of land (about 2 bigha) was taken on sub-lease by the Company, lease agreement between owners of the said land and principal lessee expired in 1975. The owners filed eviction proceedings against the principal lessee in 1976 and the suit was decided in favour of the owners in Mar, 2007. The Company appealed against the same and vide interim order in May, 2007, the order of eviction and execution proceedings pursuant to decree were since stayed by Appellate Court, pending outcome of the appeal. However, pursuant to application by owners, the Court directed the Company to deposit of H 60,000 p.m. w.e.f. 26th Mar, 2018 as occupational charges, which continues to be disclosed as ''deposit'' under note 5 of the financial statements. The appeal is currently at the final hearing stage by the Fast Track Court at Sealdah. Based on expert legal assessment, management believes that no liability needs to be accrued for rental expenses or decommissioning liabilities in the financial statements at this stage.

3. Other than above, the Company has certain litigations under Section 138 of negotiable Instruments Act, 2018 and has been provided for.

4. During the earlier year, an order was passed by Hon''ble High Court of Delhi for alleged design infringement, where the Court has issued restraining orders on the manufacturing, marketing, and selling of specific model of fans category by the Company. The court proceedings are in progress and the matter is subjudice.

The management, including its legal advisors, believes that the ultimate outcome of these proceedings will not have an adverse impact on the Company''s financial position and results of operation.

C. Others

1. There are numerous interpretative issues relating to the Supreme Court judgement dated February 28, 2019 on Provident Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability of effective date. The Company is evaluating regarding various interpretative issues and its impact for the period before February 28, 2019.

2. The Code on Social Security, 2020 (''code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The code has been published in the Gazette of India. However, the date on which the code will come into effect has not been notified and the final rules/interpretation have not yet been issued. The Company will assess the impact of the code when it comes into effect and will record any related impact in the period the code and the related rules to determine the financial impact becomes effective.

34. Segment information

The segment reporting of the Company has been prepared in accordance with Ind RS-108, "Operating Segment" (specified under the section 133 of the Companies Rct 2013 (the Rct) read with Companies (Indian Accounting Standards) Rule 2015 (as amended from time to time) and other relevant provision of the Rct).

Operating segments are defined as components of an enterprise for which discrete financial information so available is evaluated regularly by Chief Operating Decision Maker (CODM), in deciding how to allocate resources and assessing performance. Accordingly, the Company has identified two reportable business segments based on its product and services as follows:

Electrical Consumer Durables: Consists of manufacture / purchase and sale of electric Fans - ceiling, portable and airflow, along with components and accessories thereof, and Rppliances- coolers, geysers and home appliances etc .

Lighting & Switchgear: Consists of manufacture / purchase and sale of Lights & Luminaries- LED, street lights etc. and Switchgears-switches & MCB etc.

The CODM primarily uses a measure of revenue from operation and profit or loss to assess the performance of the operating segments on monthly basis.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Within India and Outside India Operations.

Unallocated

Revenue, expenses, assets and liabilities have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue, expenses, assets and liabilities which relate to Company as a whole and are not allocable to a segment on reasonable basis have been disclosed under unallocated.

35. Share based payments

The Company has, vide special resolutions passed by postal ballot, effective from March 13, 2019, introduced and implemented ''Orient Electric Employee Stock Option Scheme 2019'' ("ESOP Scheme"). The terms and broad framework of the ESOP Scheme has been approved by the Board of Directors of the Company at their meeting held on January 28, 2019. Pursuant to the provisions of Section 62(1)(b) and all other applicable provisions, if any, of the Companies Act, 2013 (the "Act") and the Companies (Share Capital and Debenture) Rules, 2014 read along with the provisions of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (SEBI ESOP Regulations), the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations"), the nomination and Remuneration Committee ("Remuneration Committee") of the Board of Directors of the Company is authorised to implement and administer the ESOP Scheme - 2019. The ESOP Scheme has been formulated in accordance with the SEBI ESOP Regulations.

Under the ESOP Scheme, the eligible employees shall be granted employee Stock Options in the form of Options ("Stock Options") which will be exercisable into equal number of equity shares of H 1/- each of the Company.

Details of the ESOP Scheme:

a) Exercise Price: Market Price of equity share as on the previous close rate on the Stock Exchange immediately preceding the date of the grant.

b) Vesting Period:

(i) 40% of options shall vest after 3 years from grant and 60% of options shall vest after 4 years from grant.

(ii) 40% of options shall vest after 2 years from grant and 60% of options shall vest after 3 years from grant.

c) Exercise Period: 4 years post vesting.

d) Method of settlement: Equity.

e) Vesting conditions: Employee remaining in the employment of the Company during the vesting period.

In exercise of the powers, Remuneration Committee has, during the year granted a total of 3,40,924 new Stock Options to eligible employees of the Company as per ESOP Scheme- 2019, while 2,20,017 Stock Options, granted in earlier years have been lapsed on account of separation of employee from the company.

36.Leases

Rs a lessee

The Company has lease contracts for various Properties (e.g. Corporate office, Depots, Plants, Warehouse etc), leased lines, office equipment''s etc used in its operations. Leases of property generally have lease terms between 2 to 9 years. The Company''s obligations under its leases are secured by the lessor''s title to the leased assets. Generally, the Company is restricted from assigning and subleasing the leased assets. There are several lease contracts that include extension and termination options which are further discussed below.

The Company also has certain leases of property and machinery with lease terms of 12 months or less and leases of office equipment with low value. The Company applies the ''short-term lease'' and ''lease of low-value assets'' recognition exemptions for these leases.

The Company had total cash outflows for leases of H 27.61 crores in March 31, 2023 (March 31, 2022: H 20.29 crores). The Company also had non-cash additions to right-of-use assets and lease liabilities of H 61.53 crores as at March 31, 2023 (March 31, 2022: H 26.46 crores).

The Company has several lease contracts that include extension and termination options. These options are negotiated by management to provide flexibility in managing the leased-asset portfolio and align with the Company''s business needs. Management exercises significant judgement in determining whether these extension and termination options are reasonably certain to be exercised.

Management expects that the entire transaction price allotted to the unsatisfied contract as at the end of the reporting period will be recognised as revenue during the next financial years.

In some contracts, the Company provides warranty to the customers as per the contract. The warranty is accounted for as a separate performance obligation and a portion of the transaction price is allocated. The performance obligation for the warranty service is satisfied based on time elapsed.

The Company''s exposure to foreign currency arises where a Company holds monetary assets and liabilities denominated in a currency different to the functional currency of that entity with Indian rupees (INR) . Set out below is the impact of a 5% change in the INR on profit and equity arising as a result of the revaluation of the Company''s foreign currency financial instruments. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year end for a 5% change in foreign currency rates. For a 5% strengthing/weakening of the INR against the relevant currency, there would be a comparable negative/positive impact on the profit or equity, as applicable.

39. Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, and trade and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s financial assets include trade and other receivables, cash and cash equivalents and security deposits that derives directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company has a Risk management policy and its management is supported by a Risk management committee that advises on risks and the appropriate financial risk governance framework for the Company. The Risk management committee provides assurance to the Company''s management that the Company''s risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk, such as commodity price risk and equity price risk. Financial instruments affected by market risk include trade payables, trade receivables, borrowings, etc.

Commodity price risk

The Company is affected by the price volatility of certain commodities. Its operating activities require the ongoing manufacture of electronic items and therefore require a continuous supply of copper and aluminium being the major input used in the manufacturing. Due to the significantly increased volatility of the price of the Copper and aluminium, the Company has entered into various purchase contracts for these material for which there is an active market. The Company maintain the level of these stocks as per the requirement of businesses and market which are discussed by the management on regular basis. Company operates in the way that saving/impact due to change in commodity price are pass on to the customers and therefore impact on profit due to change in price of commodity is unascertainable.

Interest rate risk

The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s debt obligations with floating interest rates. The Company''s borrowings outstanding as at March 31, 2023 comprise of fixed rate loans and accordingly, are not expose to risk of fluctuation in market interest rate.

Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables).

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made in the risk free bank deposits. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through counter party''s potential failure to make payments.

The Company''s maximum exposure to credit risk for the components of the balance sheet at March 31, 2023 and March 31, 2022 is the carrying amounts . Trade Receivables and other financial assets are written off when there is no reasonable expectation of recovery, such as debtor failing to engage in the repayment plan with the Company. The Company''s maximum exposure relating to financial assets is noted in liquidity table below.

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations or at a reasonable price. The Company’s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Companys net liquidity position through rolling forecasts on the basis of expected cash flows.

The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of cash credits, bank loans among others.

42. Corporate Social Responsibility (CSR)

As per provisions of section 135 of the Companies Act, 2013, read alongwith the Rules made thereunder and Schedule VII thereto, the Company has to incur at least 2% of average net profits, as per section 198 of the Companies Act, 2013, of the preceding three financial years towards Corporate Social Responsibility ("CSR"). Accordingly, the Company has spent a sum of H 3.02 crores (March 31, 2022: H 2.64 crores) towards CSR activities as approved by the Board of Directors on the recommendations of CSR committee of the Company. This amount has been charged to the Statement of Profit and Loss.

40. Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders. The primary objective of the Company''s capital management is to maximise the shareholder value and keep the debt equity ratio within acceptable range.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders and issue new shares.

The management assessed that bank balances, trade receivables, trade payables, short term borrowings and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

1. The fair values of the interest-bearing borrowings and loans are determined by using DCF method using discount rate that reflects the Company''s borrowing rate as at the end of the reporting period. The own non-performance risk as at March 31, 2023 was assessed to be insignificant.

2. Long-term receivables/payables are evaluated by the Company based on parameters such as interest rates, risk factors, individual creditworthiness of the counterparty and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy together with a quantitative sensitivity analysis as at March 31, 2023, are as shown below

Fair value hierarchy

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques that use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

47. During the year, Board of Directors of the Company had accorded their in-principal approval for disposal of land parcel at Hyderabad, total admeasuring 1,11,320 Sq. yards (hereinafter referred as "Land").In accordance with Ind AS 105 "Non-Current Assets Held For Sale and Discontinued Operations" the said land has been classified as ''Asset held for sale'' as the carrying amounts of such asset is to be recovered principally through sales transaction rather than continuing use.

The management, based on best estimates and other market factors, believes that the recoverable value of the said land, net of all expenses, is expected to be significantly higher than cost of land as on date and accordingly, the said land has been recognized and measured at carrying amount of H 16.12 crores in these financial statements.

48. Other Statutory information

(i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

(ii) The Company does not have any transactions with companies struck off under section 248 of Companies Act, 2013.

(iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

(v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(vii) The Company has not undertaken any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961.

49. The figures have been rounded off to the nearest crore of rupees upto two decimal places. The figure 0.00 wherever stated represents value less than H 50,000/-.

50. The comparative figures have been regrouped/ rearranged wherever considered necessary to make them comparable with current year numbers.

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Mar 31, 2022

a) No trade receivables are due from directors or other officers of the Company either severally or jointly with any other person. Nor any trade receivables are due from firms or private companies respectively in which any director is a partner, a director or a member.

b) Trade receivables are generally non-interest bearing.

c) Trade Receivables includes due from related parties '' 0.02 crores (March 31, 2021 : '' 0.03 crores) (Refer note 33)

d) Ageing required as per schedule III is disclosed in note no. 45.

a) Rights, preferences and restrictions attached to shares

The Company has only one class of equity shares having par value of Re. 1 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend, if proposed by the Board of Directors, is subject to the approval of the shareholders in the Annual General Meeting, except in case of interim dividend.

In the event of liquidation of the Company, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

Nature and description of reserve

a. Capital Reserve - The Company recognized profit or loss on cancellation of Companies own equity instruments to capital reserve.

b. General Reserve - General reserves are free reserves of the Company which are kept aside out of Company''s profits to meet the future requirements as and when they arise. The Company had transferred a portion of the profit after tax (PAT) to general reserve pursuant to the earlier provisions of Companies Act, 1956. Mandatory transfer to general reserve is not required under the Companies Act, 2013.

c. Share based payment reserves - The Company has a stock option scheme under which options to subscribe for the Company''s shares have been granted to certain executives and senior employees. The share-based payment reserve is used to recognise the value of equity-settled share-based payments provided to employees, including key management personnel, as part of their remuneration. Refer to Note 35 for further details of these plans.

d. Retained Earnings - Retained earnings are the accumulated profits earned by the Company till date, less transfer to general reserves, dividend and other distributions made to the shareholders.

1. Term loan from bank was secured by first pari-passu charge on immovable fixed assets of the Company at Faridabad location and first pari passu charge on the entire moveable fixed assets (both present and future) of the Company. Term loans outstanding from bank on March 31, 2022: '' Nil carrying interest @ 7.65% p.a. to 7.75% p.a. (March 31, 2021: '' 1.74 crores, carrying interest @ 7.70% to 7.75% p.a.). This Term Loan was fully paid in March 2022 and this facility has been squared off fully. First pari-passu charge got released within March 2022.

2. Cash credit, Working Capital Demand Loan and Buyer''s Credit from bank are secured against hypothecation of stock in trade, stock in progress, raw materials, stores and consumables, book debts and other current assets of the Company and second charge on Fixed assets (Moveable and Immovable) pertaining to the plants of the Company at Kolkata and Faridabad locations. Cash credit and working capital demand loans are repayable on demand. Cash Credit and Working Capital Demand Loan outstanding balance as at 31st March 2022: '' Nil carrying interest @ 4.90% to 7.20% p.a. (March 21, 2021 : '' Nil, carrying interest @ 8.05% to 9.05% p.a.).

Buyer''s credit outstanding as at 31st March 2022: '' Nil, carrying interest 1.00% to 1.25% p.a. (March 2021: '' 5.51 cr carries interest @1.09% to 1.12% p.a.")

3. The Company has availed the facility of Trade Acceptances on Trade Receivable Discounting System (TReDs) which carries interest @ 4.00% to 7.00% p.a. (March 2021 carries interest @ 4.49% to 7.00% p.a.) and outstanding is repayable within a period of 45 days from the due date.

4. Loans and Borrowing has been utilised for the purpose it has been obtained.

5. Company is having sanctioned working limits in excess of '' 5 Cr during FY-21-22 and all monthly returns and statements of current assets filed by the company with banks or financial institutions during the year are in agreement with the books of accounts.

a) Trade payables are non-interest bearing and normally settled on 0 to 90 day terms.

b) Trade Payables include due to related parties '' 3.30 crores (March 31,2021 : '' 2.62 crores) (Refer note 33).

c) Trade payables include acceptances of '' 128.96 Crores (March 31, 2021: '' 143.83 Crores). Acceptances represent arrangements where suppliers of goods and services are initially paid by the banks, while Company continues to recognize the liability till settlement with the banks, which are normally effected within a period of 89 days.

30. Employee benefits

A. Defined Benefit Schemes Gratuity

The Company has a defined benefit gratuity plan. The gratuity plan is governed by The Payment of Gratuity Act, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

Every employee is entitled to a benefit equivalent to fifteen days'' salary last drawn for each completed year of service in line with the Payment of Gratuity Act, 1972. The same is payable at the time of separation from the Company or retirement, whichever is earlier. The benefits vest after five years of continuous service.

The following tables summarises the components of net benefit expense recognized in the Statement of Profit & Loss and the funded status and amounts recognised in the balance sheet for the plan :

i. Present Value of Defined Benefit Obligation

b) Salary inflation risk: Higher than expected increases in salary will increase the defined benefit obligation.

c) Investment risk: If Plan is funded then assets liabilities mismatch and actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.

d) Demographic risk: This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria .

e) Liquidity risk: This is the risk that the Company is not able to meet the short-term gratuity pay outs. This may arise due to non availability of enough cash/cash equivalent to meet the liabilities or holding of illiquid assets not being sold in time.

f) Regulatory risk: Gratuity benefits paid in accordance with the requirements of the Payment of Gratuity Act,1972 (as amended from time to time).There is a risk of change in regulations requiring higher gratuity pay-outs (e.g. Increase in the maximum limit on gratuity of '' 20,00,000).

B. Defined Contribution Plan :

The Company deposits an amount determined at a fixed percentage of basic pay every month to the State administered

Provident Fund, Employee State Insurance (ESI) and Superannuation Fund for the benefit of the employees.

Above sensitivity analysis is based on a change in assumption while holding all the other assumptions constant. In practice, this is unlikely to occur, and change in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in balance sheet.

x. Risk exposure

The gratuity scheme is a final salary Defined Benefit Plan that provides for lump sum payment made on exit either by way of retirement, death, disability or voluntary withdrawal. The benefits are defined on the basis of final salary and the period of service and paid as lump sum at exit. Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such company is exposed to various risks as follow :

a) 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 the above benefit and will thus result in an increase in the value of the liability.

* The demand raised by the tax authorities is mainly towards disallowance of availment of CENVAT credit and classification of product in different tax buckets.

** The demands raised by the tax authorities are mainly towards enhancement of turnover due to certain disallowances, and local sales tax demand upon completion of assessment and various other miscellaneous cases raised by the respective state authorities. Entry Tax (West Bengal) - State Government reintroduced entry tax w.e.f. April 1, 2012, whereby a dealer is required to pay entry tax for importing goods from outside the State. Liability recorded in the books for Mar 2014 to Jun 2017 is '' 3.42 crores (till GST implementation date). The Company also has received a demand for interest of '' 1.56 crores in this regard which has not been provided in the books, as the Company believes that the probability of interest waiver is high, basis the order from single judge of Calcutta High Court who struck down the law stating it as unconstitutional. We have filed a writ in Hon''ble Calcutta High Court challenging the constitutional validity of the Act, which is pending finalisation.

*** Entry Tax (Haryana) - Supreme Court of India vide its order dated Nov 11, 2016, upheld the right of State Government to impose the entry tax, however on the question regarding validity of each State Legislation imposing entry tax, the bench decided to let the issue be determined by regular High Court benches of the respective states. Pending decision of High Court of Punjab & Haryana, the impact, if any, is not ascertainable at this stage and hence no provision is considered in the financial statements.

**** In the year 2021, Company had received a demand from Haryana State Pollution Control Board (HSPCB) stating that alleged discharge from its Faridabad factory was in violation of the consent limits/ prescribed standards. The Company challenged the demand in High Court of Punjab and Haryana. The matter has been disposed of, directing HSPCB to reconsider the submission of Company under the modified policy of HSPCB.However, in view of the aforesaid demand raised by HSPCB, prosecution proceedings have been initiated by HSPCB before the Magistrate Court, Faridabad, wherein summons have been served on the Company. Matter is pending adjudication.

No expenses has been accrued in the financial statements for the demands raised. Management believes that the ultimate outcome of this proceeding will not have a material adverse impact on the Company''s financial position and results of operation.

B. Other Litigations

1. During 2019-20, the Company initiated legal action against Orient General Agencies (Bombay) Pvt Ltd and Alco Logistics Pvt. Ltd. (formerly Apollo Fiege Integrated Logistics Pvt. Ltd.) for recovery of outstanding amount of '' 14.16 crores together with interest and damages upto date. The Company has taken appropriate provisions of outstanding in the books of account in earlier reporting periods. The matter is pending adjudication. OGA has filed a counter claim against the Company with Bombay High Court, which was found to be baseless and challenged by the Company and the matter is sub-judice. Simultaneously, in the criminal complaint filed against Orient General Agencies (Bombay) Pvt Ltd and Alco Logistics Pvt. Ltd. (formerly Apollo Fiege Integrated Logistics Pvt. Ltd.) and their respective directors, FIR has been registered against both accused companies as well as their directors, which is under investigation.

2. In respect of Kolkata plant where a portion of land (about 2 bigha) was taken on sub-lease by the Company, lease agreement between owners of the said land and principal lessee expired in 1975. The owners filed eviction proceedings against the principal lessee in 1976 and the suit was decided in favour of the owners in Mar, 2007. The Company appealed against the same and vide interim order in May, 2007, the order of eviction and execution proceedings pursuant to decree were since stayed by Appellate Court, pending outcome of the appeal. However, pursuant to application by owners, the Court directed the Company to deposit of '' 60,000 p.m. w.e.f. 26th Mar, 2018 as occupational charges, which is being deposited regularly by the company as directed by the court and provided in the financial statement. The appeal is currently at the final hearing stage by the Fast Track Court at Sealdah. Based on expert legal opinion, management believes that no liability needs to be accrued for any additional rental expenses or decommissioning liabilities in the financial statements at this stage.

3. Other than above, the Company has certain litigations under Section 138 of Negotiable Instruments Act, 2018 and has been provided for.

The management, including its legal advisors, believes that the ultimate outcome of these proceedings will not have an adverse impact on the Company''s financial position and results of operation.

C. Others

1. There are numerous interpretative issues relating to the Supreme Court judgement dated February 28, 2019 on Provident Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability of effective date. The Company is evaluating regarding various interpretative issues and its impact for the period before February 28, 2019.

2. During the year, an order was passed by Hon''ble High Court of Delhi for alleged design infringement, where the Court has issued restraining orders on the manufacturing, marketing, and selling of specific model of fans category by the Company. The court proceedings are in progress and the matter is subjudice.

3. The Code on Social Security, 2020 (''code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The code has been published in the Gazette of India. However, the date on which the code will come into effect has not been notified and the final rules/interpretation have not yet been issued. The Company will assess the impact of the code when it comes into effect and will record any related impact in the period the code and the related rules to determine the financial impact becomes effective.

Note 1: The remuneration to the key managerial personnel/others does not include the provisions made for gratuity and leave benefits, as they are determined on an actuarial basis for the Company as a whole.

Note 2: Share based payment transactions included above relates to fair value of options granted to Key Managerial Personnel under the ESOP scheme, that is amortised in the Profit & Loss during the grant period until the Vesting of the shares as per the scheme. (Refer Note 13c)

34. Segment information

The segment reporting of the Company has been prepared in accordance with Ind AS-108, "Operating Segment" (specified under the section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards) Rule 2015 (as amended from time to time) and other relevant provision of the Act).

Operating segments are defined as components of an enterprise for which discrete financial information so available is evaluated regularly by Chief Operating Decision Maker (CODM), in deciding how to allocate resources and assessing performance. Accordingly, the Company has identified two reportable business segments based on its product and services as follows:

i Electrical Consumer Durables - Consists of manufacture / purchase and sale of electric Fans - ceiling, portable and airflow, along with components and accessories thereof, and Appliances- coolers, geysers and home appliances etc.

ii Lighting & Switchgear- Consists of manufacture / purchase and sale of Lights & Luminaries- LED, street lights etc. and Switchgears- switches & MCB etc.

The CODM primarily uses a measure of revenue from operation and profit or loss to assess the performance of the operating segments on monthly basis.

The Company primarily operates in India. However, the analysis of geographical segments is demarcated into within India and outside India Operations.

Unallocated

Revenue, expenses, assets and liabilities have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue, expenses, assets and liabilities which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed under unallocated.

35. Share based payments

The Company has, vide special resolutions passed by postal ballot, effective from March 13, 2019, introduced and implemented ''Orient Electric Employee Stock Option Scheme 2019'' ("ESOP Scheme"). The terms and broad framework of the ESOP Scheme has been approved by the Board of Directors of the Company at their meeting held on January 28, 2019. Pursuant to the provisions of Section 62(1)(b) and all other applicable provisions, if any, of the Companies Act, 2013 (the "Act") and the Companies (Share Capital and Debenture) Rules, 2014 read along with the provisions of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (SEBI ESOP Regulations), the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations"), the Nomination and Remuneration Committee ("Remuneration Committee") of the Board of Directors of the Company is authorised to implement and administer the ESOP Scheme - 2019. The ESOP Scheme has been formulated in accordance with the SEBI ESOP Regulations.

Under the ESOP Scheme, the eligible employees shall be granted employee Stock Options in the form of Options ("Stock Options") which will be exercisable into equal number of equity shares of Re. 1/- each of the Company.

36. Leases

As a lessee

The Company adopted Ind AS 116 using the modified retrospective method , with the date of initial application on April 01, 2019.

The Company has lease contracts for various Properties (e.g. Corporate office, Depots, Plants, Warehouse etc), leased lines, office equipment''s etc used in its operations. Leases of property generally have lease terms between 2 to 9 years. The Company''s obligations under its leases are secured by the lessor''s title to the leased assets. Generally, the Company is restricted from assigning and subleasing the leased assets. There are several lease contracts that include extension and termination options and variable lease payments, which are further discussed below.

The Company also has certain leases of property and machinery with lease terms of 12 months or less and leases of office equipment with low value. The Company applies the ''short-term lease'' and ''lease of low-value assets'' recognition exemptions for these leases.

The Company had total cash outflows for leases of '' 20.29 crores in March 31, 2022 ( March 31, 2021: '' 18.13 crores). The Company also had non-cash additions to right-of-use assets and lease liabilities of '' 26.46 crores as at March 31, 2022 ( March 31,2021: '' 3.46 crores).

The Company has several lease contracts that include extension and termination options. These options are negotiated by management to provide flexibility in managing the leased-asset portfolio and align with the Company''s business needs. Management exercises significant judgement in determining whether these extension and termination options are reasonably certain to be exercised.

(All amounts in Rupees Crores, unless otherwise stated) the price of the Copper and aluminium, the Company has entered into various purchase contracts for these material for which there is an active market. The Company maintain the level of these stocks as per the requirement of businesses and market which are discussed by the management on regular basis. Company operates in the way that saving/impact due to change in commodity price passes on to the customers and therefore impact on profit due to change in price of commodity is unascertainable.

Interest rate risk

The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s debt obligations with floating interest rates.

39. Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, and trade and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s financial assets include trade and other receivables, cash and cash equivalents and security deposits that derives directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company has a Risk management policy and its management is supported by a Risk management committee that advises on risks and the appropriate financial risk governance framework for the Company. The Risk management committee provides assurance to the Company''s management that the Company''s risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk, such as commodity price risk and equity price risk. Financial instruments affected by market risk include trade payables, trade receivables, borrowings, etc.

Commodity price risk

The Company is affected by the price volatility of certain commodities. Its operating activities require the ongoing manufacture of electrical and electronic items and therefore require a continuous supply of copper, aluminium, steel and integrated circuit (IC) being the major input used in the manufacturing. Due to the significantly increased volatility of

Foreign currency risk

The Company''s exposure to foreign currency arises where a Company holds monetary assets and liabilities denominated in a currency different to the functional currency of that entity with Indian rupees (INR) . Set out below is the impact of a 5% change in the INR on profit and equity arising as a result of the revaluation of the Company''s foreign currency financial instruments. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year end for a 5% change in foreign currency rates. A positive number below indicates as increase in profit or equity where the INR strengthens by 5% against the relevant currency. For a 5% weakening of the INR against the relevant currency, there would be a comparable negative/positive impact on the profit or equity, as applicable.

Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables).

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made in the risk free bank deposits. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through counter party''s potential failure to make payments.

40. Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders. The primary objective of the Company''s capital management is to maximise the shareholder value and keep the debt equity ratio within acceptable range.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders and issue new shares.

The Company''s maximum exposure to credit risk for the components of the balance sheet at March 31, 2022 and March 31,2021 is the carrying amounts . Trade Receivables and other financial assets are written off when there is no reasonable expectation of recovery, such as debtor failing to engage in the repayment plan with the Company. The Company''s maximum exposure relating to financial assets is noted in liquidity table below.

Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations or at a reasonable price. The Company''s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company''s net liquidity position through rolling forecasts on the basis of expected cash flows.

The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of cash credits, bank loans among others.

The management assessed that bank balances, trade receivables, trade payables, short term borrowings and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

1. The fair values of the interest-bearing borrowings and loans are determined by using DCF method using discount rate that reflects the Company''s borrowing rate as at the end of the reporting period. The own non-performance risk as at March 31, 2022 was assessed to be insignificant.

2. Long-term receivables/payables are evaluated by the Company based on parameters such as interest rates, risk factors, individual creditworthiness of the counterparty and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy together with a quantitative sensitivity analysis as at March 31, 2022, are as shown below

Fair value hierarchy

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques that use inputs that have a significant effect on the recorded fair value that are not based on observable

47. The global pandemic outbreak had impacted the Company''s business in early part of the financial year. However, the Company has been able to recover the business in course of the year. The Company has made an impact assessment of the pandemic and basis the current year results and best estimates of revenue, expenses and current assets, as on the date of reporting, the Company does not anticipate any material impact on the recoverability of the carrying value of its assets. The management has also estimated future cash flows for the Company and believes that there will be no impact on its ability to continue as going concern and meeting its liabilities as and when they fall due. However, considering the unpredictability and inherent uncertainty on the potential future impact of the pandemic, the Company''s financial results may differ from that estimated as on the date of approval of these financial statements.

48. Other Statutory Information

(i) The Company do not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

(ii) The Company do not have any transactions with companies struck off.

(iii) The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

(v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(vii) The Company has not any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961.

49 . The figures have been rounded off to the nearest crore of rupees upto two decimal places. The figure 0.00 wherever stated

represents value less than '' 50,000/-.

50 . The comparative figures have been regrouped/ rearranged wherever considered necessary to make them comparable

with current year numbers.

---

Mar 31, 2019

1. Corporate information

The Company was incorporated on October 10, 2016 and was a subsidiary of Orient Paper & Industries Ltd. (OPIL). A scheme of arrangement had been filed with the National Company Law Tribunal to demerge the consumer electric business of the holding Company (OPIL) by transferring the same on a going concern basis to the Company w.e.f March 1, 2017, which has subsequently been approved by the National Company Law Tribunal vide its order as stated in Note No. 29 below.

Pursuant to Scheme of Arrangement shares held by the demerged Company stand cancelled and post demerger, the Company is no more a subsidiary of OPIL.

The Company is a public company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India. Its shares are listed on two recognised stock exchanges in India. The registered office of the Company is located at Unit VIII, Plot 7, Bhoinagar, Bhubneswar, Odisha.

The Company is primarily engaged in manufacture/purchase and sale of Electrical Consumer Durables, Lighting & Switchgear products. The Company presently has manufacturing facilities at Faridabad, Noida, Kolkata and Guwahati.

These financial statements were authorised for issue in accordance with a resolution of the Board of Directors on April 30, 2019.

a. Cost includes gross block of Rs.0.47 crores (March 31, 2018: Rs.0.40 crores) (Accumulated depreciation Rs.0.08 crores (March 31, 2018: Rs.0.08 crores), Net block Rs.0.39 crores (March 31, 2018: Rs.0.32 crores)) in respect of flat whose registration in the Company''s name is pending. The possession of flat was handed over to Company in the year 2006 pursuant to Delhi High Court order dated 20th July 2006 which was challenged by the builder and currently under litigation for transfer of title in the name of Company. The matter is currently sub judice.

b. Factory buildings include gross block of Rs.3.15 crores (March 31, 2018: Rs.3.10 crores) (Accumulated depreciation Rs.1.64 crores (March 31, 2018: Rs.1.25 crores), Net block Rs.1.51 crores (March 31, 2018: Rs.1.85 crores)) in respect of leasehold improvements and non factory building includes gross block of Rs.2.97 crores (March 31, 2018: Nil) (Accumulated depreciation Rs.0.30 crores (March 31, 2018: Nil), Net block Rs.2.67 crores (March 31, 2018: Nil)) in respect of leasehold improvements.

c. For charge created on Property, plant and equipment of the Company towards borrowings, refer Note 13(5).

d. The Company is in the process of getting the above properties registered / transferred in its name pursuant to the Scheme of Arrangement (Refer Note 29).

a) No trade receivables are due from directors or other officers of the Company either severally or jointly with any other person. Nor any trade receivables are due from firms or private companies respectively in which any director is a partner, a director or a member.

b) Trade receivables are generally non-interest bearing and normally settled on 45 to 90 days term.

c) Trade Receivables include due from related parties RS.0.11 crores (March 31, 2018 : RS.0.17 crores) (Refer note 36)

a) Rights, preferences and restrictions attached to 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. The Company declares and pays dividends in Indian rupees. The dividend, if proposed by the Board of Directors, is subject to the approval of the shareholders in the Annual General Meeting, except in case of interim dividend.

In the event of liquidation of the Company, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

As per records of the Company, including its register of shareholders/members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.

(c) Aggregate number of shares bought back, or issued as fully paid up pursuant to contract without payment being received in cash or by way of bonus shares during the period of five years immediately preceding the date of Balance sheet:

Note:

1. Term loans from banks are secured by first pari-passu charge on the fixed assets (both present and future) pertaining to the plants of the Company at Kolkata and Faridabad locations. Term loan amounting to RS.2.29 crores, carries interest @ 9.90% p.a (March 31, 2018: 9.10% p.a.) and is repayable in single instalment due in the month of May'' 2019. Another term loan amounting to RS.23.98 crores carries interest @ 10.10% p.a. (March 31, 2018: @ 9.90% p.a.), this loan is repayable in 7 equal instalments ending on February 07, 2023.

2. Term loan from others are secured by pari-passu first charge on the fixed assets (both present and future) pertaining to the plants of the Company at Kolkata and Faridabad locations. Term loan of RS.9.07 crores carries interest @11.00 % p.a. (March 31, 2018: @10.50% p.a) and is repayable in 7 equal instalments ending on December 21, 2020.

3. Cash credit and working capital demand loans from banks are secured against hypothecation of stock in trade, stock in progress, raw materials, stores and consumables, book debts and other current assets of the Company and second charge on moveable fixed assets pertaining to the plants of the Company at Kolkata and Faridabad locations. Cash credit and working capital demand loans are repayable on demand. The above loans carry interest @ 8.65% p.a. to 10.15% p.a. (March 31, 2018: @ 7.50% p.a. to 10.35% p.a.).

4. Buyers credit from a bank carries interest @ LIBOR plus spread of 0.50% (March 31, 2018: 0.50 % p.a) and was repayable in 120 days.

5. Completion of mutation on title of above mentioned properties is pending in the name of Orient Electric Limited, therefore, creation of charge is in abeyance on Term Loan in favour of Lenders (Refer note 29 for scheme of demerger).

Provision for warranties

A provision is recognised for expected warranty claims on product sold under warranty as per the technical estimates made by the management based on historical trends. It is expected that most of this cost will be incurred over the warranty terms. The table below gives information about movement in warranty provisions.

a) Trade payables are non-interest bearing and normally settled on 0 to 45 day terms.

b) Trade Payables include due to related parties RS.2.13 crores (March 31, 2018 : RS.1.27 crores) (Refer note 36)

c) Trade payables includes acceptances of H83.76 Crores (March 31, 2018: Nil)

Notes:

1. Refer note 39 for disclosure of revenue from contract with customers under Ind AS 115.

2. Post applicability of Goods and Service Tax (GST) w.e.f. July 1, 2017, revenue from operations is disclosed net of GST. However, revenue for the financial year ended March 31, 2018 is inclusive of excise duty for three months i.e. April 01, 2017 to June 30, 2017.

2. Scheme of Arrangement

a) During the previous year, pursuant to the Scheme of Arrangement ("the scheme”) approved by the National Company Law Tribunal, all the assets and liabilities of the Consumer Electric Business of Orient Paper & Industries Limited ("Demerged Company”) had been transferred to and vested in the Company at their respective book values on a going concern basis from March 01, 2017 being the appointed date.

As per the scheme, appointed date as approved by National Company Law Tribunal was March 01,2017 and effective date was December 08, 2017 being the date on which certified copy of the order sanctioning the said scheme was filed with Registrar of Companies, Odisha in accordance with Companies Act, 1956 & applicable provisions of the Companies Act, 2013. The scheme was operative from the appointed date i.e. March 01, 2017.

Against the above contingent liability, payments have been made under protest and/ or debts have been withheld by respective parties.

*Includes deferred tax assets on brought forward losses and unabsorbed depreciation apportioned amongst the demerged Company and the resulting Company in the ratio of assets retained by the demerged Company and transferred to the resulting Company as per the Scheme and on 43B items.

**The above liabilities includes RS.141.57 crores being general or multipurpose borrowings of the Company transferred from the Demerged Company in the ratio of the value of assets transferred bears to the total value of the assets of the Demerged Company immediately before the appointed date in terms of the said scheme.

c) Pursuant to the Scheme, 5,00,000 equity shares of RS.1 each of the Company held by Demerged Company (OPIL) stands cancelled and the said amount had been credited to Capital Reserve.

d) Pursuant to the Scheme, the Company had issued 21,21,85,502 equity shares of RS.1 each to the shareholders of the demerged Company aggregating to RS.21.22 crores, in the ratio of 1 equity share of face value of RS.1 each of the Company for every 1 equity share of face value of RS.1 each held in the demerged Company .

e) Pursuant to the Scheme, the difference between the net book value of assets and liabilities of the Consumer Electric undertaking and shares to be issued to the shareholders of the demerged Company were credited to General Reserve amounting to RS.179.83 crores.

f) After the transfer of above balances from the Demerged Company as on the appointed date, the account heads were reclassified in accordance with the Ind AS.

3. In terms of Ind AS 103 ''Business Combination'', the above demerger was a business combination under Common Control, accordingly, the financial information in these financial statements in respect of Balance Sheet as at March 31, 2017 has been restated on account of transfer of Consumer Electric Business of Orient Paper & Industries Limited w.e.f March 01, 2017 to the Company as per the Scheme of Arrangement approved by National Company Law Tribunal as stated in Note 29 above.

4. Employee benefits

A. Defined Benefit Schemes Gratuity

The Company has a defined benefit gratuity plan. The gratuity plan is governed by The Payment of Gratuity Act, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

Every employee is entitled to a benefit equivalent to fifteen days'' salary last drawn for each completed year of service in line with the Payment of Gratuity Act, 1972. The same is payable at the time of separation from the Company or retirement, whichever is earlier. The benefits vest after five years of continuous service.

The following tables summarises the components of net benefit expense recognized in the Statement of Profit & Loss and the funded status and amounts recognised in the balance sheet for the plan :

The weighted average duration of the defined benefit obligation as at March 31, 2019 is 9 years (March 31, 2018: 8 years).

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled.

Above sensitivity analysis is based on a change in assumption while holding all the other assumptions constant. In practice, this is unlikely to occur, and change in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in balance sheet.

x. Risk exposure

The gratuity scheme is a final salary Defined Benefit Plan that provides for lump sum payment made on exit either by way of retirement, death, disability or voluntary withdrawal. The benefits are defined on the basis of final salary and the period of service and paid as lump sum at exit. Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such company is exposed to various risks as follow :

a) Interest rate risk: The defined benefit obligation calculated uses a discount rate based on government bonds, if bond yield fall, the defined benefit obligation will tend to increase.

b) Salary inflation risk: Higher than expected increases in salary will increase the defined benefit obligation.

c) Investment risk: If Plan is funded then assets liabilities mismatch and actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.

d) Demographic risk: This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria.

B. Defined Contribution Plan :

The Company deposits an amount determined at a fixed percentage of basic pay every month to the State administered Provident Fund, Employee State Insurance (ESI) and Superannuation Fund for the benefit of the employees.

5. Operating lease: Company as lessee

Certain office premises, equipments, depots etc are obtained by the Company on operating lease. The lease term is for 1- 9 years and renewable for further period either mutually or at the option of the Company. Lease agreements have price escalation clauses. The rent is not based on any contingencies. There are no restrictions imposed by lease arrangements.

6. Capital and other commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) RS.2.69 crores (March 31, 2018: H4.35 crores).

The Company is contesting the demands and the management including its legal advisors believes that its position will likely be upheld in the appellate process. No tax expenses has been accrued in the financial statements for the tax demand raised. Management believes that the ultimate outcome of this proceeding will not have a material adverse impact on the Company''s financial position and results of operation.

There are numerous interpretative issues relating to the Supreme Court (SC) judgement dated February 28, 2019 on Provident Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability of effective date. The Company is evaluating and seeking legal inputs regarding various interpretative issues and its impact.

36. Related party transactions I. List of Related parties

A) Enterprise having significant influence on the Company

i) Central India Industries Limited

B) Enterprises over which Members of the Board of Directors/KMP has significant influence

i. Orient Paper and Industries Limited

ii. Orient Cement Limited

iii. National Engineering Industries Limited

iv. GMMCO Limited

v. AVTEC Limited

vi. HIL Limited

vii. CK Birla Corporate Services Limited

viii. Neosym Industry Limited

C) Members of the Board of Directors/Key management personnel (KMP)

i. Chairman and Non-Executive Director

a) Mr C.K. Birla (from January 19, 2018)

ii. Managing Director & CEO

a) Mr. Rakesh Khanna (Managing Director from January 23, 2018)

iii. Other Non-Executive Directors

a) Mr. Desh Deepak Khetrapal (from January 19, 2018)

b) Mr. TCA Ranganathan, Independent director (from January 19, 2018)

c) Mr. K. Pradeep Chandra, Independent director (from January 19, 2018)

d) Ms. Alka Marezban Bharucha, Independent director (from January 19, 2018)

e) Mr. P.K. Sonthalia (upto January 23, 2018)

f) Mr. P.C.Agarwala (upto January 23, 2018)

g) Mr. M.L. Pachisia (upto January 23, 2018)

iv) Chief Financial Officer

a) Mr. Manoj Kumar Dugar (upto April 24, 2018)

b) Mr. Saibal Sengupta (from April 27, 2018)

v) Company Secretary

a) Mr. Hitesh Kumar Jain (from December 19, 2017)

D) Relative of Member of Board of Directors/KMP

i. Ms. Nirmala Birla

ii. Ms. Amita Birla

iii. Ms. Avani Birla

iv. Ms. Avanti Birla

Note 1: The remuneration to the key managerial personnel does not include the provisions made for gratuity and leave benefits, as they are determined on an actuarial basis for the Company as a whole.

Note 2: The amount disclosed above are inclusive of GST.

* The appointed date of Scheme is March 01, 2017 as approved by the National Company Law Tribunal, though it has become effective on December 08, 2017, therefore all other current account transactions from March 01, 2017 to December 08, 2017 between the Demerged Company and the Resulting Company has not been shown as related party transaction as these were done considering the Resulting Company as a unit of the Demerged Company (Refer note 29).

7. Segment information

The segment reporting of the Company has been prepared in accordance with Ind AS-108, ''Operating Segment'' (specified under the section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards) Rule 2015 (as amended from time to time) and other relevant provision of the Act.

Operating segments are defined as components of an enterprise for which discrete financial information so available is evaluated regularly by Chief Operating Decision Maker (CODM), in deciding how to allocate resources and assessing performance. Accordingly, the Company has identified two reportable business segments based on its product and services as follows:

i. Electrical Consumer Durables- Consists of manufacture / purchase and sale of electric Fans - ceiling, portable and airflow, along with components and accessories thereof, and Appliances- coolers, geysers and home appliances etc .

ii. Lighting & Switchgear- Consists of manufacture / purchase and sale of Lights & Luminaries- LED, street lights etc. & Switchgears- switches & MCB etc.

The CODM primarily uses a measure of revenue from operation and profit or loss to assess the performance of the operating segments on monthly basis.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Within India and Outside India Operations.

Unallocated

Revenue, expenses, assets and liabilities have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue, expenses, assets and liabilities which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed under unallocated.

B Geographical Segment

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Within India and Outside India Operations.

8. Share based payments

The Company has, vide special resolutions passed by postal ballot, effective from March 13, 2019, introduced and implemented ''Orient Electric Employee Stock Option Scheme 2019'' ("ESOP Scheme"). The terms and broad framework of the ESOP Scheme has been approved by the Board of Directors of the Company at their meeting held on January 28, 2019. Pursuant to the provisions of Section 62(1)(b) and all other applicable provisions, if any, of the Companies Act, 2013 (the "Act") and the Companies (Share Capital and Debenture) Rules, 2014 read along with the provisions of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (SEBI ESOP Regulations), the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations"), the Nomination and Remuneration Committee ("Remuneration Committee") of the Board of Directors of the Company is authorised to implement and administer the ESOP Scheme - 2019. The ESOP Scheme has been formulated in accordance with the SEBI ESOP Regulations.

Under the ESOP Scheme, the eligible employees shall be granted employee Stock Options in the form of Options ("Stock Options") which will be exercisable into equal number of equity shares of RS.1/- each of the Company.

Details of the ESOP Scheme:

a) Exercise Price: Market Price of equity share as on the previous close rate on the Stock Exchange immediately preceding the date of the grant.

b) Exercise Period: 4 years post vesting.

c) Method of settlement: Equity.

d) Vesting conditions: Employee remaining in the employment of the Company during the vesting period.

e) Details of Grant during the year: In exercise of the powers, Remuneration Committee has, at its meeting held March 27, 2019, approved and recommended to the Board of Directiors, the grant of 19,98,309 Stock Options to the selected 18 eligible employees of the Company as per ESOP Scheme- 2019, at RS.144.10 per option on the date of grant which the Board of Directors has approved. Accordingly, as per the Scheme, exercise price was also set as RS.144.10 per option.

f) Vesting Period of Grant: 40% of above options shall vest after 3 years and 60% of options shall vest after 4 years, from grant date.

9. Revenue from Contracts with Customers- Ind AS 115

9.1 Disaggregated revenue information

Set out below is the disaggregation of the Company''s revenue from contracts with customers:

Trade receivables are non-interest bearing and are generally on terms of 45 to 90 days. Contract liabilities include short-term advances received from customer to deliver goods.

Management expects that the entire transaction price allotted to the unsatisfied contract as at the end of the reporting period will be recognised as revenue during the next financial year.

10. Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, and trade and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s financial assets include trade and other receivables, cash and cash equivalents and security deposits that derives directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company has a Risk management policy and its management is supported by a Risk management committee that advises on risks and the appropriate financial risk governance framework for the Company. The Risk management committee provides assurance to the Company''s management that the Company''s risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk, such as commodity price risk and equity price risk. Financial instruments affected by market risk include trade payables, trade receivables, borrowings, etc.

Commodity price risk

The Company is affected by the price volatility of certain commodities. Its operating activities require the ongoing manufacture of electronic items and therefore require a continuous supply of copper and aluminium being the major input used in the manufacturing. Due to the significantly increased volatility of the price of the Copper and aluminium, the Company has entered into various purchase contracts for these material for which there is an active market. The Company maintain the level of these stocks as per the requirement of businesses and market which are discussed by the management on regular basis. Company operates in the way that saving/impact due to change in commodity price are pass on to the customers and therefore impact on profit due to change in price of commodity is unascertainable.

Interest rate risk

The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s debt obligations with floating interest rates.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings. With all other variables held constant, the Company''s profit before tax is affected through the impact on floating rate borrowings, as follows.

Foreign currency risk

The Company''s exposure to foreign currency arises where a Company holds monetary assets and liabilities denominated in a currency different to the functional currency of that entity with Indian rupees (INR). Set out below is the impact of a 5% change in the INR on profit and equity arising as a result of the revaluation of the Company''s foreign currency financial instruments. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year end for a 5% change in foreign currency rates. A positive number below indicates as increase in profit or equity where the INR strengthens by 5% against the relevant currency. For a 5% weakening of the INR against the relevant currency, there would be a comparable negative/positive impact on the profit or equity, as applicable.

Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables).

Trade receivables

Customer credit risk is managed by the Company''s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on individual credit limits defined by the Company. Outstanding customer receivables are regularly monitored.

An impairment analysis is performed at each reporting date on an individual basis. The calculation is based on historical data of credit losses.

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made in the risk free bank deposits. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through counter party''s potential failure to make payments.

The Company''s maximum exposure to credit risk for the components of the balance sheet at March 31, 2019 and March 31, 2018 is the carrying amounts . Trade Receivables and other financial assets are written off when there is no reasonable expectation of recovery, such as debtor failing to engage in the repayment plan with the Company. The Company''s maximum exposure relating to financial assets is noted in liquidity table below.

Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations or at a reasonable price. The Company''s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company''s net liquidity position through rolling forecasts on the basis of expected cash flows.

The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of cash credits, bank loans among others.

Maturity profile of Financial liabilities

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.

11. Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders. The primary objective of the Company''s capital management is to maximise the shareholder value and keep the debt equity ratio within acceptable range.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders and issue new shares.

12. Fair value measurements

Set out below, is a comparison by class of the carrying amounts and fair value of the Company''s financial instruments, other than those with carrying amounts that are reasonable approximations of fair values:

The management assessed that bank balances, trade receivables, trade payables, short term borrowings and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

1. The fair values of the interest-bearing borrowings and loans are determined by using DCF method using discount rate that reflects the Company''s borrowing rate as at the end of the reporting period. The own non-performance risk as at March 31, 2019 was assessed to be insignificant.

2. Long-term receivables/payables are evaluated by the Company based on parameters such as interest rates, risk factors, individual creditworthiness of the counterparty and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy together with a quantitative sensitivity analysis as at March 31, 2019, are as shown below

Fair value hierarchy

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques that use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

13. Standards issued but not effective

The amendments to standards that are issued, but not yet effective, up to the date of issuance of the Company''s financial statements are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective.

The Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Amendment Rules, 2017 and Companies (Indian Accounting Standards) Amendment Rules, 2018 amending the following standard:

Ind AS 116 Lease

Ind AS 116 Leases was notified by MCA on 30 March 2019 and it replaces Ind AS 17 Leases, including appendices thereto. Ind AS 116 is effective for annual periods beginning on or after 1 April 2019. Ind AS 116 sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the accounting for finance leases under Ind AS 17. The standard includes two recognition exemptions for lessees - leases of ''low-value'' assets (e.g., personal computers) and short-term leases (i.e., leases with a lease term of 12 months or less). At the commencement date of a lease, a lessee will recognise a liability to make lease payments (i.e., the lease liability) and an asset representing the right to use the underlying asset during the lease term (i.e., the right-of-use asset). Lessees will be required to separately recognise the interest expense on the lease liability and the depreciation expense on the right-of-use asset.

Lessees will be also required to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognise the amount of the remeasurement of the lease liability as an adjustment to the right-of-use asset.

Lessor accounting under Ind AS 116 is substantially unchanged from today''s accounting under Ind AS 17. Lessors will continue to classify all leases using the same classification principle as in Ind AS 17 and distinguish between two types of leases: operating and finance leases.

The Company is evaluating the requirements of the amendment and the effect on the financial statements is being evaluated. The Company plans to adopt the new standard on the required effective date using the modified retrospective approach.

Appendix C to Ind AS 12 Uncertainty over Income Tax Treatment

The Interpretation addresses the accounting for income taxes when tax treatments involve uncertainty that affects the application of Ind AS 12 and does not apply to taxes or levies outside the scope of Ind AS 12, nor does it specifically include requirements relating to interest and penalties associated with uncertain tax treatments. The Interpretation specifically addresses the following:

- Whether an entity considers uncertain tax treatments separately

- The assumptions an entity makes about the examination of tax treatments by taxation authorities

- How an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates

- How an entity considers changes in facts and circumstances

An entity has to determine whether to consider each uncertain tax treatment separately or together with one or more other uncertain tax treatments. The approach that better predicts the resolution of the uncertainty should be followed. In determining the approach that better predicts the resolution of the uncertainty, an entity might consider, for example, (a) how it prepares its income tax filings and supports tax treatments; or (b) how the entity expects the taxation authority to make its examination and resolve issues that might arise from that examination.

The interpretation is effective for annual reporting periods beginning on or after April 01, 2019, but certain transition reliefs are available. The Company will apply the interpretation from its effective date. The Company intends to adopt these standards from 1 April2019. The adoption of this standard is not likely to have a material impact in its financial statements.

Amendments to Ind AS 19: Plan Amendment, Curtailment or Settlement

The amendments to Ind AS 19 address the accounting when a plan amendment, curtailment or settlement occurs during a reporting period. The amendments specify that when a plan amendment, curtailment or settlement occurs during the annual reporting period, an entity is required to:

- Determine current service cost for the remainder of the period after the plan amendment, curtailment or settlement, using the actuarial assumptions used to remeasure the net defined benefit liability (asset) reflecting the benefits offered under the plan and the plan assets after that event.

- Determine net interest for the remainder of the period after the plan amendment, curtailment or settlement using: the net defined benefit liability (asset) reflecting the benefits offered under the plan and the plan assets after that event; and the discount rate used to remeasure that net defined benefit liability (asset).

The amendments also clarify that an entity first determines any past service cost, or a gain or loss on settlement, without considering the effect of the asset ceiling. This amount is recognised in profit or loss.

An entity then determines the effect of the asset ceiling after the plan amendment, curtailment or settlement. Any change in that effect, excluding amounts included in the net interest, is recognised in other comprehensive income.

The amendments apply to plan amendments, curtailments, or settlements occurring on or after the beginning of the first annual reporting period that begins on or after 1 April 2019. These amendments will apply only to any future plan amendments, curtailments, or settlements of the Company.

14. The figures have been rounded off to the nearest crore of rupees upto two decimal places. The figure 0.00 wherever stated represents value less than Rs.50,000/-.

15. The comparative figures have been regrouped/ rearranged wherever considered necessary to make them comparable with current year numbers.

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Mar 31, 2018

1. Corporate Information

The Company was incorporated on 10^th October 2016 and was a subsidiary of Orient Paper & Industries Ltd. (OPIL). A scheme of arrangement had been filed with the National Company Law Tribunal to demerge the consumer electric business of the holding Company (OPIL) by transferring the same on a going concern basis to the Company w.e.f 1^st March 2017, which has subsequently been approved by the National Company Law Tribunal vide its order as stated in Note 28.

Pursuant to Scheme of Arrangement shares held by the demerged Company stands cancelled and post demerger, the Company is no more a subsidiary of OPIL.

The Company is primarily engaged in manufacture/purchase and sale of Electrical Consumer Durables and Lighting & switchgear products. The Company presently has manufacturing facilities at Faridabad, Noida, Kolkata and Guwahati.

These financial statements were authorised for issue in accordance with a resolution of the Board of Directors on 27^th April, 2018.

2. Basis of Preparation

These financial statements of the Company have been prepared in accordance with Indian Accounting Standards (“Ind AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015, (as amended from time to time). For the period from October 10, 2016 (being the date of incorporation) to 31 March 2017, the Company prepared its financial statements in accordance with accounting standards notified under the section 133 of the Companies Act 2013, read together with paragrapRs.7 of the Companies (Accounts) Rules, 2014 (Indian GAAP) and Companies (Accounting Standards) Amendment Rules 2016. These financial statements for the year ended 31^st March, 2018 are the first financial statements that the Company has prepared in accordance with Ind AS.

The Company has not availed any exemption under IND AS-101.

Note: During the year ended 31 March 2018, the authorised share capital was increased to Rs.2500 lacs i.e. 2500 lacs Equity shares of Re.1 each.

a) Terms/ rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Re.1 per share. Each holder of equity shares is entitled to one vote per share.

The Company declares and pays dividends in Indian rupees. The Board of Directors at its meeting held on 12^th February, 2018 and 27^th April, 2018, have declared an interim dividend of Re.0.50 per equity share (31^st March, 2017: Nil) and proposed a final dividend of Re. 0.50 per equity share respectively for the financial year ended 31^st March, 2018. The proposed final dividend of Rs. 1,276.91 Lacs (including DDT thereon) are subject to the approval of the Shareholders at the forthcoming Annual General Meeting and are not recognised as a liability as on 31^st March, 2018.

In the event of liquidation of the Company, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

1. Term loan from Banks are secured by first pari-passu charge on the fixed assets (both present and future) pertaining to the Paper plants at Amlai & Brajrajnagar of the demerged CompanyTerm loan of Rs. 1133.72 lacs carries interest @ 9.10% p.a (31 March 2017: 9.10% p.a.) and Rs. 2573.28 lacs carries interest @ 9.90% p.a. (31 March 2017: @ 10.45% p.a.). The above loans are repayable in 17 equal quarterly instalments starting from 28 May, 2015 and 20 unequal quarterly instalments starting from 08 May, 2018 respectively (upto 28 May, 2019 and 8 February, 2023 respectively).

2. Term loan from others are secured by pari-passu first charge on the fixed assets (both present and future) pertaining to the Paper plants at Amlai and Brajrajnagar of the demerged Company. Term Loan of Rs. 506.90 lacs carries interest @ 11.20% p.a. (31 March 2017: 10.95 % p.a.) and is repayable in 20 equal quarterly instalments starting from 28 June, 2014 (upto 28 March, 2019). Term loan of Rs. 1401.87 carries interest @10.50% p.a. (31 March 2017: @11.00% p.a) and is repayable in 16 equal quarterly instalments starting from 21 March, 2017 (upto 21 December, 2020).

3. Cash credit (including Working Capital Demand Loans) from banks are secured against hypothecation of stock in trade, stock in progress, raw materials, stores and chemicals, book debts and other current assets of the Company and second charge on fixed assets pertaining to the Paper plants at Amlai & Brajrajnagar of the Demerged Company and are repayable on demand. The above loans carry interest @ 7.50% p.a. to 10.35% p.a. (31 March 2017 :@ 8.25% p.a. to 10.35% p.a.).

4. Export Packing Credit from a Bank carry interest @4.15% to 4.25% p.a.(31 March 2017 : 8.50%) and are repayable in 180 days.

5. Buyers Credit from a Bank carries interest @ LIBOR plus spread of 0.50% p.a (31 March 2017: 0.45 % to 0.65%) and is repayable in 120 days.

6. The Company is in the process of getting the securities of above loans transferred on assets of the Company against the above borrowings which are presently secured by assets pertaining to the demerged Company of which details are given above.

Provision for Warranties

A provision is recognized for expected warranty claims on products based on management estimate of present obligation in this regard during the warranty period, computed on the basis of past experience of levels of repairs and returns. It is expected that the entire provision will be utilized within two years from the Balance Sheet date, since the warranty period generally extends to two years. The table below gives information about movement in warranties provisions.

Entire deferred income tax for the period ended 31^st March 2018 relates to origination and reversal of temporary differences.

A reconciliation of the income tax provision to the amount computed by applying the statutory income tax rate to the income before income taxes is summarized below:

The Company has incurred certain research and development expenses amounting to Rs 287.11 lacs (31^st March, 2017: Nil), and they are recognised in employee benefit & other expenses.

3. Scheme of Arrangement

a) Pursuant to the Scheme of Arrangement (‘the scheme’) approved by the National Company Law Tribunal, all the assets and liabilities of the Consumer Electric Business of Orient Paper & Industries Limited (‘Demerged Company’) has been transferred to and vested in the Company at their respective book values on a going concern basis from 1^st March, 2017 being the appointed date.

As per the scheme, appointed date as approved by National Company Law Tribunal is 1^st March, 2017 and effective date is 8^th December, 2017 being the date on which certified copy of the order sanctioning the said scheme is filed with Registrar of Companies, Odisha in accordance with Companies Act, 1956 & applicable provisions of the Companies Act, 2013. Though the scheme has become effective after the balance sheet date, it is operative from the appointed date i.e. 1^st March, 2017.

b) The details of assets and liabilities transferred from Demerged Company are as under:

Against the above, payments have been made under protest and/ or debts have been withheld by respective parties.

includes deferred tax assets on brought forward losses and unabsorbed depreciation apportioned amongst the demerged Company and the resulting Company in the ratio of assets retained by the demerged Company and transferred to the resulting Company as per the Scheme and on 43B items.

**The above liabilities includes Rs.14,157 lacs being general or multipurpose borrowings of the Company transferred from the Demerged Company in the ratio of the value of assets transferred bears to the total value of the assets of the Demerged Company immediately before the appointed date in terms of the said scheme.

c) Pursuant to the Scheme, 5 lacs equity shares of Re. 1 each of the Company held by Demerged Company (OPIL) stands cancelled and the said amount has been credited to Capital Reserve.

d) Pursuant to the Scheme, the Company has issued 21,21,85,502 equity shares of Re 1 each to the shareholders of the demerged Company aggregating to Rs. 2121.86 lacs, in the ratio of 1 equity share of face value of Re. 1 each of the Company for every 1 equity share of face value of Re. 1 each held in the demerged Company .

e) Pursuant to the Scheme, the difference between the net book value of assets and liabilities of the Consumer Electric undertaking and shares to be issued to the shareholders of the demerged Company has been credited to General Reserve.

f) After the transfer of above balances from the Demerged Company as on the appointed date, the account heads have been reclassified in accordance with the Ind AS.

4. In terms of Ind AS 103 ‘Business Combination’, the above demerger is a business combination under Common Control, accordingly, the financial information in these financial statements in respect of Balance Sheet as at 31^st March, 2017 has been restated on account of transfer of Consumer Electric Business of Orient Paper & Industries Limited w.e.f 1^st March, 2017 to the Company as per the Scheme of Arragement approved by National Company Law Tribunal as stated in Note 28 above.

5. Significant Accounting Judgements, Estimates and Assumption

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

There are no significant areas involving a high degree of judgement or complexity.

Estimates and Assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Defined Benefit Plans

The cost of defined benefit gratuity plan and its present value of the obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, an employee benefit obligation is highly sensitive to changes in these assumptions particularly the discount rate and estimate of future salary increase. All assumptions are reviewed at each reporting date.

The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds.

The mortality rate is based on publicly available mortality tables. Those mortality tables tend to change only at interval in response to demographic changes. Future salary increases are based on expected future inflation rates.

Further details about gratuity obligations are given in Note 32.

Provisions and Contingencies

The assessments undertaken in recognising provisions and contingencies have been made in accordance with the applicable Ind AS. A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Where the effect of time value of money is material, provisions are determined by discounting the expected future cash flows. The Company has significant capital commitments in relation to various capital projects which are not recognized on the balance sheet. In the normal course of business, contingent liabilities may arise from litigation and other claims against the Company. Guarantees are also provided in the normal course of business. There are certain obligations which management has concluded, based on all available facts and circumstances, are not probable of payment or are very difficult to quantify reliably, and such obligations are treated as contingent liabilities and disclosed in the notes but are not reflected as liabilities in the financial statements. Although there can be no assurance regarding the final outcome of the legal proceedings in which the Company is involved, it is not expected that such contingencies will have a material effect on its financial position or profitability.

Taxes

Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies. Deferred tax assets on unabsorbed depreciation/business loss have been recognised to the extent of deferred tax liabilities on taxable temporary differences available. It is expected that any reversals of the deferred tax liability would be offset against the reversal of the deferred tax assets.

6. Gratuity and other Post-Employment Benefit Plans

The Company has a defined benefit gratuity plan. The gratuity plan is governed by The Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The scheme is funded with an insurance company in the form of qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the Statement of Profit and Loss and the funded status and amounts recognised in the balance sheet for the plan.

The weighted average duration of the defined benefit obligation as at 31^st March, 2018 is 8 years.

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled.

7. Leases

Operating lease: Company as lessee

Certain office premises, equipments, depots etc are obtained by the Company on operating lease. The lease term is for 1- 3 years and renewable for further period either mutually or at the option of the Company. Lease agreements have price escalation clauses. The rent is not based on any contingencies. There are no restrictions imposed by lease arrangements. The leases are cancellable.

8. Capital and other Commitments

Estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) Rs. 434.68 lacs (31^st March 2017: Rs. 162.90 lacs).

Based on discussions with the solicitors/ favorable decisions in similar cases/legal opinions taken by the Company, the management believes that the Company has a good chance of success in above-mentioned cases and hence, no provision there against is considered necessary. The timing of outflow of resources is not ascertainable.

Related Party Transactions

The details of related parties transactions entered into by the Company for the year ended 31^st March 2018 and 31^st March 2017, and the details of amounts due to or due from related parties as at 31^st March 2018 & 31^st March 2017 are as follows:

Note 1: The remuneration to the key managerial personnel does not include the provisions made for gratuity and leave benefits, as they are determined on an actuarial basis for the Company as a whole.

*The appointed date of Scheme is March 1, 2017 as approved by the National Company Law Tribunal, though it has become effective on December 8, 2017, therefore all other current account transactions from March 1, 2017 to December 8, 2017 between the Demerged Company and the Resulting Company has not been shown as related party transaction as these were done considering the Resulting Company as a unit of the Demerged Company.

9. Segment Information

Operating segments are defined as components of an enterprise for which discrete financial information so available that is evaluated regularly by chief operating decision maker, in deciding how to allocate resources and assessing performance. Accordingly, the Company has identified “Electrical Consumer Durables” & ’Lighting & Switchgear’ as the business segments.

Electrical Consumer Durables - Consists of manufacture / purchase and sale of Electric Fans - ceiling, portable and airflow, along with Components and Accessories thereof, and Appliances .

Lighting & Switchgear- Consists of manufacture / purchase and sale of Lights & Luminaries & Switchgears.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Indian and Overseas Revenues. Assets are segregated based on their geographical location.

10. Financial Risk Management Objectives and Policies

The Company’s financial liabilities comprise loans and borrowings, and trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s financial assets include trade and other receivables, cash and cash equivalents and security deposits.

The Company is exposed to market risk, credit risk and liquidity risk. The Company has a Risk management policy and its management is supported by a Risk management committee that advises on risks and the appropriate financial risk governance framework for the Company. The Risk management committee provides assurance to the Company’s management that the Company’s risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk, such as commodity price risk and equity price risk. Financial instruments affected by market risk include trade payables, trade receivables, borrowings, etc.

Interest Rate Risk

The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s debt obligations with floating interest rates.

Interest Rate Sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings. With all other variables held constant, the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows.

Foreign Currency Risk

The Company’s exposure to foreign currency arises where a Company holds monetary assets and liabilities denominated in a currency different to the functional currency of that entity with INR. Set out below is the impact of a 5% change in the INR on profit and equity arising as a result of the revaluation of the Company’s foreign currency financial instruments. The sensitivity analysis includes only outstanding foreign currency denominated monetory items and adjusts their translation at the year end for a 5% change in foreign currency rates. A positive number below indicates as increase in profit or equity where the Rs. strengthens by 5% against the relevant currency. For a 5% weakening of the Rs. against the relevant currency, there would be a comparable negative/positive impact on the profit or equity, as applicable.

Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables).

Trade Receivables

Customer credit risk is managed by the respective department subject to Company’s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on individual credit limits as defined by the Company. Outstanding customer receivables are regularly monitored.

An impairment analysis is performed at each reporting date on an individual basis. The calculation is based on historical data of credit losses.

Liquidity Risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations or at a reasonable price. The Company’s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company’s net liquidity position through rolling forecasts on the basis of expected cash flows.

The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of cash credits, bank loans among others.

Maturity Profile of Financial Liabilities

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.

11. Capital Management

For the purpose of the Company’s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders. The primary objective of the Company’s capital management is to maximise the shareholder value and keep the debt equity ratio within acceptable range.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial convenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders and issue new shares.

12. Standards issued but not effective

The amendments to standards that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective.

The Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Amendment Rules, 2017 and Companies (Indian Accounting Standards) Amendment Rules, 2018 amending the following standard:

Ind AS 115 Revenue from Contracts with Customers

The Company is currently evaluating the impact of implementation of Ind AS 115 “Revenue from Contracts with Customers” which is applicable to it w.e.f April 01, 2018. However, based on the evaluation done so far and based on the arrangement that the Company has with its customers for sale of its products, the implementation of Ind AS 115 will not have any significant recognition and measurement impact. However, there will be additional presentation and disclosure requirement which will be provided in the next year’s financial statements.

Amendments to Ind AS 12 Recognition of Deferred Tax Assets for Unrealised Losses

The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how an entity should determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than their carrying amount.

Appendix B to Ind AS 21 Foreign Currency Transactions and Advance Consideration

The Appendix clarifies that, in determining the spot exchange rate to use on initial recognition of the related asset, expense or income (or part of it) on the derecognition of a non-monetary asset or non-monetary liability relating to advance consideration, the date of the transaction is the date on which an entity initially recognises the non-monetary asset or non-monetary liability arising from the advance consideration. If there are multiple payments or receipts in advance, then the entity must determine the transaction date for each payment or receipt of advance consideration.

The Appendix is effective for annual periods beginning on or after 1 April 2018. However, since the Company’s current practice is in line with the Interpretation, the Company does not expect any effect on its financial statements.

These financial statements, for the year ended 31 March 2018, are the first financial statements, the Company has prepared in accordance with Ind AS. For period upto and including the year ended 31 March 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragrapRs.7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for year ending on 31^st March 2018, together with the comparative periods data as at and for the year ended 31 March 2017, as described in the summary of significant accounting policies.

A. Footnotes to the reconciliation of Equity as at 31^st March 2017 and Profit or Loss for the period ended 31^st March 2017.

a. Re-Classifications

The Company has made following reclassification as per the requirements of Ind-AS:

i) Re-Measurement gains/(losses) on defined benefit plans on long term employee benefit plans are re-classified from profit and loss to OCI.

b. Sale of Goods

Under Indian GAAP, sale of goods was presented as net of excise duty. However, under Ind AS, sale of goods includes excise duty. Excise duty on sale of goods is separately presented on the face of statement of profit and loss as an expense.

13. Fair Value

The fair value of the financial assets and liabilities approximates their carrying amounts.

14. The Company has been incorporated on 10^th October, 2016 and the business transfer pursuant to demerger has been accounted w.e.f. March 01, 2017 being the appointed date as per the Scheme. Hence, the figures for the previous year in the Statement of Profit & Loss are not comparable. Following the Scheme, no restatement of comparitives has been done for the period prior to the appointed date.