Enter the first few characters of Company and click 'Go'

Notes to Accounts of RHI Magnesita India Ltd.

Mar 31, 2023

Terms and rights attached to equity shares

Equity share has a par value of '' 1. They entitle the holder to participate in dividend, and to share in the proceeds of winding up of the Company in proportion to number of and amounts paid on shares held.

Every holder of equity shares present at a meeting in person or proxy, is entitled to one vote, and upon a poll each share is entitled one vote.

*The National Company Law Tribunal, Mumbai (''NCLT'') vide its order dated 5 May, 2021 approved and sanctioned the scheme of amalgamation (the ''Scheme'') of the Company with its fellow subsidiaries i.e. RHI India Private Limited (''RHI India'') and RHI Clasil Private Limited (''RHI Clasil'') (hereinafter referred as ''erstwhile fellow subsidiaries'') with an appointed date of 31 July, 2018.

During the year ended 31 March, 2022, the Company has issued and allotted 40,857,131 equity shares to the shareholders of its erstwhile fellow subsidiaries and pursuant to the Scheme becoming effective, in accordance with clause 3.2 of the Scheme, the authorised share capital of the Company have increased from '' 1,205 lacs to '' 3,080 lacs.

Nature and purpose of Reserves Securities premium

This reserve represents the premium on issue of shares and can be utilised in accordance with the provisions of the Companies Act, 2013. General reserve

General reserve represents profits transferred from retained earnings from time to time to general reserve for appropriate purposes based on the provisions of the erstwhile Companies Act, 1956. Consequent to introduction of the Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. It can be utilised in accordance with the provisions of the Companies Act, 2013.

Retained earnings

Retained earnings represents accumulated profits of the Company. It can be utilised in accordance with the provisions of the Companies Act, 2013.

Capital Reserve

Capital reserve is the difference between the consideration and the Share Capital of the erstwhile fellow subsidiaries on 01 April, 2019 is '' 1,465.71 lacs.

Borrowings are subsequently measured at amortised cost and therefore interest accrued on current borrowings are included in the respective amounts.

Term loan 1: External commercial borrowing of EUR 3,000,000 was taken from the VRD Americas B.V. Netherland (fellow subsidiary) during the financial year 2014-15 which carries interest at applicable 6 month Euribor plus 200 basis points. It was repayable in single instalment of EUR 3,000,000 on 31 December 2022. The repayment date now has been extended to 31 December, 2023 on mutual agreement of both the parties.

Term loan 2: External commercial borrowing of EUR 3,950,000 was taken from the VRD Americas B.V. Netherland (fellow subsidiary) during the financial year 2016-17 which carries interest at applicable 6 month Euribor plus 150 basis points. It is originally repayable in single instalment of EUR 3,950,000 on 31 December, 2023.

Loan from bank: During the year, the Company has taken loan from The Hongkong and Shanghai Banking Corporation Limited Bank for 12 months of '' 61,500 lacs which carries interest at Benchmark rate plus margin; where Benchmark rate is T-bill (1 month) and Margin is 2%, which will further increase by 25 basis points every three months. The loan is repayable after 12 months from first utilisation date and partial repayment is also allowed. The Company has partially repaid the loan amounting to '' 7,000 lacs on 26 February, 2023.

The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes 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 repotting period) has been applied as when calculating the Defined benefit recognised in the balance sheet. The methods and types of assumptions used in preparation, the sensitivity analysis did not change compared to the prior period.

(F) Risk Exposures:

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Salary Increases: Actual salary increases will increase the Plan''s liability. Increase in salary increase rate assumption in future valuations will also increase the liability.

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

Discount Rate: Reduction in discount rate in subsequent valuations can increase the plan''s liability.

Reason for shortfall in the current year

Out of unspent amount of '' 233.55 lacs, the reasons are as follows:

a) '' 199.45 lacs is towards ongoing project i.e construction of road and building for public utility. Construction was started in the month of February 2023, it is a time consuming activity and hence could not be completed by 31 March, 2023. The same will be completed by December 2023. The projected amount has been transferred to the unspent CSR account on 27 April, 23 and will be spent in accordance with the provisions of Section 135 of Companies Act, 2013 and the rules made thereunder.

b) '' 34.10 lacs is due to delay in identifying a project within stipulated time period and has been deposited in Prime Minister''s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund) in compliance with the provisions of Section 135 read with Companies (Corporate Social Responsibility Policy) Rules, 2014 and schedule VII of Companies Act, 2013.

Per sub-section (5) of Section 135 of the Act, the Company is required to transfer unspent Corporate Social Responsibility expenditure for the year ended 31 March, 2023 in respect of âother than ongoing projectsâ to a Fund specified in Schedule VII to the Act, the time period of such transfer, i.e., six months of the expiry of the financial year end as permitted under the second proviso to sub-section (5) of Section 135 of the Act. The amount has been deposited before the date of approval of these Standalone Financial Statement in Prime Minister''s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund) in compliance with the provisions of Section 135 read with Companies (Corporate Social Responsibility Policy) Rules, 2014 and schedule VII of Companies Act, 2013. Details are as given below.

Note 31: Financial Risk Management

The Company''s activities expose it to credit risk, liquidity risk and market risk.

The Company''s senior management has the overall responsibility for establishing and governing the Company''s risk management framework. The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set and monitor appropriate risk limits and controls, periodically review the changes in market conditions and reflect the changes in the policies accordingly. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

A. Credit Risk

Credit risk on cash and cash equivalent and bank balances is not significant as it majorly includes deposits with bank and financial institutions with high credit ratings assigned by international and domestic credit rating agencies.

Other financial assets primary includes security deposits given to lessors. These deposits are given in the normal course of the business operations.

Credit risk arise from possibility that customer may default on its obligation to make timely payments, resulting into financial loss. The maximum exposure to the credit risk is primarily from trade receivable and contract assets.

The credit risk is managed by the Company through credit term approvals, establishing the financial reliability of the customers taking into account the financial condition, analysis of historical bad debts and ageing of account receivables. Outstanding customer receivables are regularly monitored. Individual credit terms are set accordingly by the Company''s credit control department.

To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared credit risk characteristics and the days past due. The contract assets relate to unbilled revenue and retention money pending due on completion of performance obligation and have substantially the same risk characteristics as the trade receivables for the same types of contracts. To address the risk of any potential non recovery from trade receivables, the Company has the practice of reviewing debtors having balances outstanding for more than 180 days as at period end and consider them for provision for bad and doubtful debts. Besides this, wherever there is specific evidence about the deteriorating financial position, downfall in business, intention to not pay or other similar factors of the customer, the management reviews the underlying facts and merits of such cases to evaluate the need to adjust provision, as computed based on ageing analysis. This provision, based on collective analysis, is sufficient to cover the entire lifetime loss of revenues recognised including those that are currently less than 180 days outstanding and not provided for.

Liquidity risk is the risk that the Company will not be able to settle or meet its obligations on time. The Company''s primary sources of liquidity are cash generated from operations. The cash flows from operating activities are driven primarily by operating results and changes in the working capital requirements.

The Company believes that its liquidity position is adequate to fund the operating and investing needs and to provide with flexibility to respond to further changes in the business environment.

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 prices comprises two types of risk: foreign currency risk and interest rate risk. Financial instruments affected by market risks include

borrowings, foreign currency receivables and payables.

(i) Foreign currency risk: The Company operates internationally and is exposed to foreign exchange risk in relation to operating activities (when revenue or expense is denominated in a foreign currency) arising from foreign currency transactions, primarily with respect to the USD and EUR. The Company manages the exposure through natural hedging, by maintaining appropriate balances of receivables and payables within same currency. The Company also has policies to enter into foreign currency financial contracts in order to manage the impact of changes in foreign exchange rates on the results of operations and future foreign currency denominated cash flows. Forward exchange contracts are not intended for trading or speculative purposes but only for hedge purposes. The Company does not have material foreign currency exposure .

(ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates.

Interest Rate Exposure

The exposure of the Company''s borrowings to interest rate changes at the end of the reporting period are included in the table below. As at the end of the reporting period, the Company had the following variable rate borrowings:

Note 32. Capital management

A. Risk Management

The Company''s objectives when managing capital is to safeguard their ability to continue as a going concern, so that it can continue to provide adequate returns to the shareholders.

The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximising the return to stakeholders through efficient allocation of capital towards business needs, optimisation of working capital requirements and deployment of surplus funds into fixed deposits.

Timing of Revenue Recognition

Revenue from contracts for total refractory management services, revenue is recognized over time using the output-oriented method (e.g. quantity of steel produced by the customer).

Revenue from providing services is recognized in the accounting period in which the services are rendered.

Performance obligations

Revenue from the sale of products is recognised at the point in time when control over the products is passed to the customers, which is determined based on the individual terms agreed in the customer contract. Control is defined as the ability to direct the use and obtain substantially all the economic benefits from an asset. For the terms CIF (Cost, Insurance and Freight), transport service gives rise to a separate performance obligation to which a part of revenue has to be allocated, as this service is performed after the control of the product is transferred to the customer.

For Refractory Management services where the transaction price depends on the customer''s production tonnage the management has determined that both supply of goods and services are not distinct as the customer expects total refractory management services from the Company, which includes supply of refractory material and its related services to produce steel. Thus, only one single performance obligation, the performance of refractory management services, exists. With regard to these contracts, revenue is recognised over time using the output-oriented method (e.g. quantity of steel produced by the customer).

Revenue from services is recognised over time, using an input method to measure progress towards completion of service, because the customer simultaneously receives and consumes the benefits provided by the Company.

Transaction price allocated to the remaining performance obligations

The Company has applied practical expedient in Ind AS 115. Accordingly it has not disclosed information about remaining performance obligations wherein the Company has a right to consideration from customer in an amount that directly corresponds with the value to the customer of entity''s performance till date using the output method and for the other contracts which have original expected durations of one year or less.

Trade Receivables and Contract Balances

The Company classifies the right to consideration in exchange for deliverables as either a receivable or as Contract Asset.

A receivable is a right to consideration that is unconditional upon passage of time.

Contract liabilities consists of advances from customers. Contract liabilities are presented in note 14.

Significant judgements in the application of the Standard

For Refractory Management Contracts where the transaction price depends on the customer''s production performance, the management has determined that both supply of goods and services are not distinct as the customer expects total refractory management services from the Component, which includes supply of refractory material and its related services to produce steel. The customer expects complete refractory management for the agreed product areas in the steel plant in order to enable steel production. Thus, only one single performance obligation, performance of refractory management service, exists.

Note 40: Business Combinations

Acquisition of refractory business of Hi-Tech Chemicals

On 18 October, 2022, the Board of Directors of the Company approved the acquisition of the refractory business of Hi-Tech Chemicals Limited by way of a slump sale on a going concern basis and executed the Business Transfer Agreement (BTA). The Company has completed the acquisition of the refractory business on 31 January, 2023 for a cash consideration of '' 87,937.65 lacs. Acquired business primarily engaged in manufacturing and supply refractories, isostatically pressed ceramics, slide gate plates and other allied products and has manufacturing facility in Jamshedpur, Jharkhand.

This transaction has been accounted for as per acquisition method specified in Ind AS 103 and accordingly, the difference of '' 36,724.63 lacs between the purchase consideration of '' 87,937.65 lacs and provisional fair value of net assets has been recognised as preliminary goodwill. Acquisition-related costs are expensed as incurred. The goodwill is attributable to the workforce and capability of the business to economies of scale expected from combining the operations resulting in increase in profitability of the acquired business. It will not be deductible for tax purpose.

From the date of acquisition to the year ended 31 March, 2023, the acquired business have contributed, revenue from operations of '' 3,462.14 lacs and incurred loss for the year of '' 106.50 lacs to the revenue from operations and loss for the year of the combined entity respectively. Management estimates that if the said business combination had taken place at the beginning of the year, the revenue from operations would have been '' 32,895.99 lacs and profit for the year would have been '' 7,731.81 lacs in the Standalone Statement of Profit and Loss.

Note 41: Acquisition of subsidiaries

On 19 November, 2022, Dalmia Bharat Refractories Limited (''DBRL'') entered into a business transfer agreement (BTA) with Dalmia OCL Limited (''DOCL'') to transfer the entire Indian refractory business of DBRL to DOCL. On 19 November, 2022, the Company entered into a Share Swap Agreement with DOCL and DBRL to acquire all outstanding shares of DOCL. On 04 January, 2023, the business transfer between DBRL and DOCL was completed as per the terms and conditions of BTA. As per the share swap agreement, on 05 January, 2023, the Company completed the purchase of 100% shareholding in DOCL. The Company has discharged the consideration by issuance and allotment of 27,000,000 fresh equity shares of the Company to DBRL amounting to '' 236,844 lacs. The shares have been issued by the Company at the market rate of 05 January, 2023 of '' 877.20 per share. The issuance of equity shares has resulted in increase in equity share capital by '' 270 lacs consisting of 27,000,000 equity shares of '' 1 each. The difference between the consideration and the increase in equity share capital is recorded as securities premium of '' 236,574 lacs.

As part of this acquisition the Company has also acquired indirectly 51% share holding in RHI Magnesita Seven Refractories Limited (formerly known as Dalmia Seven Refractories Limited).

Note 42: Transfer Pricing

The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under Sections 92-92F of the Income-tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the international and domestic transactions entered into with the associated enterprise during the financial year and expects such records to be in existence latest by 30 November, 2023, as required by law. The Management confirms that its international and domestic transactions are at arm''s length so that the aforesaid legislation will not have any impact on the Standalone financial statements, particularly on the amount of tax expenses and that of provision for taxation.

Note 43: Additional regulatory information required by Schedule III

(i) Details of benami property held

No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

(ii) Borrowing secured against current assets

The Company does not have credit limits sanctioned from the banks on the basis of security of current assets. During the year, the Company has taken loan from the bank which is guaranteed by RHI Magnesita N.V., Austria, ultimate holding company.

(iii) Wilful defaulter

The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

(iv) Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

(v) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013.

(vi) Compliance with approved scheme(s) of arrangements

The Company has not entered into any scheme of arrangement which has an accounting impact on current year. In previous year , the Scheme was approved by NCLT. The Company has complied with the approved Scheme.

(vii) Utilisation of borrowed funds and share premium

(a) 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:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

(b) 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:

(i) 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

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

(viii) Undisclosed income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

(ix) Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

(x) Valuation of property, plant and equipment and intangible assets

The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

(xi) Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

(xii) Utilisation of borrowings availed from banks.

The borrowings obtained by the Company from banks have been applied for the purposes for which such loans were taken.

Note 44: Title deeds of immovable properties not held in name of the company

The title deeds of all the immovable properties (other than properties where the company is the lessee and the lease agreements are duly executed in favour of the lessee), are held in the name of the company except the following:

Note 46: Qualified Institutional Placement (QIP) of Equity shares

On 13 March, 2023, the shareholders of the Company approved the offering of equity shares of the Company pursuant to Qualified Institutional Placement in accordance with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended (the ''Offering''). Pursuant to the Offering, on 06 April, 2023, the Company has issued and allotted 15,715,034 equity shares of face value '' 1 each at a issue price of '' 572.70 per equity share including a premium of '' 571.70 per equity share aggregating to '' 90,000 lacs. The Company plans to utilise the net proceeds from the Offering for the purpose of repayment / pre-payment, in full or in part, of certain outstanding borrowings availed by the Company, investment into one of the Subsidiaries, Dalmia OCL Limited (âDOCLâ), for repayment or pre-payment, in full or in part, of certain borrowings availed by DOCL and general corporate purposes.

Note 47: Preferential issue of Equity shares

On 01 April, 2023, Board of Directors approved a proposal to raise funds up to '' 20,000 lacs through issuance of Equity Shares on preferential basis to Dutch US Holding B.V., promoter of the Company, subject to the approval from Shareholders. The Company issued a postal ballot notice dated 29 April, 2023 to the Shareholders of the Company seeking approval to issue equity shares at a price of '' 716.83 per equity share. The Company proposes to utilise the proceeds for repayment/ prepayment in full or in part of certain outstanding borrowings availed by the Company, investment in one of its Subsidiary i.e. Dalmia OCL limited for General Corporate purposes.

Note 48: Investment in Subsidiary

On 08 May, 2023, the Company has made further investment in Dalmia OCL Limited (the ''DOCL''), a wholly owned subsidiary of the Company, by way of subscription of 16,975,051 equity shares of DOCL having face value of '' 10 each at a premium of '' 197 each for an amount aggregating to '' 35,138.36 lacs on right issue basis. The purpose of subscription of equity shares of DOCL by the Company is for repayment or pre-payment in full or in part of certain borrowings availed by DOCL.

Note 49:

Rounding of amounts

All amounts disclosed in the Standalone financial statements and notes have been rounded off to the nearest lacs as per the requirement of Schedule III, unless otherwise stated.

Mar 31, 2022

Term loan 1: External commercial borrowing of EURO 3,000,000 was taken from the VRD Americas B.V. Netherland (fellow subsidiary) during the financial year 2014-15 which carries interest at applicable 6 month Euribor plus 200 basis points. It is repayable in single installment of EURO 3,000,000 on 31 December 2022.

Term loan 2: External commercial borrowing of EURO 3,950,000 was taken from the VRD Americas B.V. Netherland (fellow subsidiary) during the financial year 2016-17 which carries interest at applicable 6 month Euribor plus 150 basis points. It is repayable in single installment of EURO 3,950,000 on 31 December 2023.

* Includes foreign currency trade payables amounting to '' 8,314.54 lacs as at 31 March, 2022 (31 March, 2021: '' Nil) which are overdue for more than 180 days. The Company has approached the authorised dealer, under the Foreign Exchange Management (Import of Goods and Services) Regulations, 2015, to condone the delay and seeking permission of extension of time period for settlement of these balances. Pending resolution of this matter, no adjustments are considered necessary in these Standalone Financial Statements.

(ii) Defined Benefit Plan - Gratuity:

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The gratuity plan is a funded plan and the company makes contribution to recognised funds in India. The Company does not fully fund the liability and maintains the target level of funding to be maintained over a period of time based on estimations of expected gratuity payments. The gratuity fund plan assets of the Company are managed by RHI Magnesita India Employees Group Gratuity Trust and erstwhile RHI India Private Limited Group Gratuity Trust through Kotak Gratuity Group Plan and group gratuity plan with Life Insurance Corporation of India, respectively.

(F) Risk Exposures:

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Salary Increases: Actual salary increases will increase the Plan''s liability. Increase in salary increase rate assumption in future valuations will also increase the liability.

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

Discount Rate: Reduction in discount rate in subsequent valuations can increase the plan''s liability.

(G) Defined benefit liability and employer contribution

The Company monitors the deficit in defined benefit obligation (net off plan assets) and endevours to meet such deficit within reasonable future. The objective is to ensure adequate investments of funds, at appropriate time, to generate sufficient corpus for future payments.

Reason for shortfall in the current year

There was delay in spending the required CSR expenditure due to Covid-19 pandemic impact in the initial period of the financial year because of which several officials of the Company were infected and it was difficult for the Company to keep its operations running and the management was focused on ensuring smooth functioning of the business.

Per sub-section (5) of Section 135 of the Act, the Company was required to transfer unspent Corporate Social Responsibility expenditure as at 31 March, 2021 in respect of âother than ongoing projectsâ to a Fund specified in Schedule VII to the Act within the six months of the expiry of the financial year end. However, transfer of certain amount was made beyond a period of six months of the expiry of the financial year end. The Company has filed a compounding application with respect to above mentioned non compliance with the Ministry of Corporate Affairs on 20 May, 2022 and the management is of the view that the impact of potential compounding is not expected to be material to the Company. Details are as given below:

Per sub-section (5) of Section 135 of the Act, the Company is required to transfer unspent Corporate Social Responsibility expenditure for the year ended 31 March, 2022 in respect of âother than ongoing projectsâ to a Fund specified in Schedule VII to the Act, the time period of such transfer, i.e., six months of the expiry of the financial year end as permitted under the second proviso to sub-section (5) of Section 135 of the Act has not elapsed until the date of approval of these Standalone Financial Statements. Details are as given below.

The Company''s activities expose it to market risk, liquidity risk and credit risk.

A. Credit Risk

Other financial assets primary includes security deposits given to lessee''s. These deposits are given in the normal course of the business operations.

To address the risk of any potential non recovery from trade receivables, the Company has the practise of reviewing debtors having balances outstanding for more than 180 days as at period end and consider them for provision for bad and doubtful debts. Besides this, wherever there is specific evidence about the deteriorating financial position, downfall in business, intention to not pay or other similar factors of the customer, the management reviews the underlying facts and merits of such cases to evaluate the need to adjust provision, as computed based on ageing analysis. This provision, based on collective analysis, is sufficient to cover the entire lifetime loss of revenues recognised including those that are currently less than 180 days outstanding and not provided for.

B. Liquidity Risk:

The Company believes that its liquidity position is adequate to fund the operating and investing needs and to provide with flexibility to respond to further changes in the business environment.

C. 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 prices comprises two types of risk: foreign currency risk and interest rate risk. Financial instruments affected by market risks include borrowings, foreign currency receivables and payables.

Foreign currency risk: The Company operates internationally and is exposed to foreign exchange risk in relation to operating activities (when revenue or expense is denominated in a foreign currency) arising from foreign currency transactions, primarily with respect to the USD and EUR. The Company manages the exposure through natural hedging, by maintaining appropriate balances of receivables and payables within same currency. The Company also has policies to enter into foreign currency financial contracts in order to manage the impact of changes in foreign exchange rates on the results of operations and future foreign currency denominated cash flows. Forward exchange contracts are not intended for trading or speculative purposes but only for hedge purposes.

The Company does not have material foreign currency exposure.

Interest rate risk

Note 31 : Capital management

A. Risk Management

The Company''s objectives when managing capital is to safeguard their ability to continue as a going concern, so that it can continue to provide adequate returns to the shareholders.

The Company''s manages its capital to ensure that the Company will be able to continue as a going concern while maximising the return to stakeholders through efficient allocation of capital towards business needs, optimisation of working capital requirements and deployment of surplus funds into fixed deposits.

The management of the Company reviews the capital structure of the Company on regular basis. As part of this review, the Board considers the status of debts, cost of capital and movement in the working capital.

Note 32: Segment information

The Company is primarily engaged in the business of manufacturing refractories and monolithics. Based on the information reported to the chief operating decision maker (CODM) for the purpose of resources'' allocation and assessment of performance, there is single business segment in accordance with the requirements of Indian Accounting Standard (Ind AS 108 on ''Operating Segment Reporting'' notified under the Companies (Indian Accounting Standard) Rules, 2015.

Geographical Segments:

The analysis of geographical segment is based on the geographical location of the customers. The Company operates primarily in India and has presence in international markets as well. Its business is accordingly aligned geographically, catering to two markets i.e. India and Outside India. For customers located outside India, the Company has assessed that they carry same risk and rewards. The Company has considered domestic and exports markets as geographical segments and accordingly disclosed these as separate segments. The geographical segments considered for disclosure are as follows:

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India

All other assets (other than trade receivables) used in the Company''s business are located in India and are used to cater to both the categories of customers (within India and outside India). Accordingly the total cost incurred during the year to acquire property, plant and equipment and intangible assets has not been disclosed.

Note 33: Contingent Liabilities

Claims against the Company not acknowledged as debts

Demand from income tax	1,150.26	993.91
Demand from excise and service tax authorities	329.56	316.12
Demand from customs authorities	291.88	291.88
Demand from central sales tax	16.53	16.53
Total	1,788.23	1,618.44

Notes :

(i) No provision is considered necessary since the Company expects favourable decisions.

(ii) Paid under protest of '' 39.59 Lacs (31 March, 2021, '' 39.59 Lacs)

These represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages professional advisors to protect its interests and has been advised that it has strong legal positions against such disputes. It is not practicable for the Company to estimate the timing of cash outflows, if any, in respect of the above pending resolution of the respective proceedings.

Note 34 (a): Capital and other commitments:

(i) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of capital advances):

(ii) The Company has other commitments, for purchases/sales orders which are issued after considering requirements per operating cycle for purchase/sale of goods and services and employee benefits, in normal course of business.

(iii) The Company has long term commitments/contracts for which there were no material foreseeable losses. The Company did not have any long-term derivative contracts as at 31 March, 2022.

Note 34 (b): Operating Leases

The Company''s cancellable operating lease arrangements mainly consists of offices, guest house and warehouse for period of less than 11 months. Terms of lease include terms for renewal, increase in rent in future periods and terms of cancellation (refer note 27).

Note 37: Equity-settled share option plan (LTIP)

RHI Magnesita N.V (Ultimate Holding Company) has implemented a share option plan for the members of senior management including of the Company. Each share option converts into one ordinary share of RHI Magnesita N.V on exercise. No amounts are paid or payable by the recipient on receipt of the option. The options carry rights to dividends but no voting rights. Options may be exercised at any time from the date of vesting to the date of their expiry. The number of options granted is calculated in accordance with the performance-based formula approved by the shareholders of the Ultimate Holding Company. The vesting period for each share option plan is three years. If the options remain unexercised after a period of seven years from the vesting date the, options expire. Options are forfeited if the employee leaves the Company before the options vest. The allocation of share option plan has been made by the Ultimate Holding Company pursuant to the following plans:

In the following tables, revenue is disaggregated by product group and by geography. This is consistent with the revenue information that is disclosed for each reportable segment under Ind AS 108 (refer note 32). The Company believes that this disaggregation best depicts how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by industry, market and other economic factors.

Revenue from the delivery of products is recognised at the point in time when control over the products is passed to the customers, which is determined based on the individual terms agreed in the customer contract. Revenue from contracts for total refractory management services, revenue is recognized over time using the output-oriented method (e.g. quantity of steel produced by the customer). Revenue from providing services is recognized in the accounting period in which the services are rendered.

Performance obligations

Transaction price allocated to the remaining performance obligations

Trade Receivables and Contract Balances

The Company classifies the right to consideration in exchange for deliverables as either a receivable or as Contract Asset.

A receivable is a right to consideration that is unconditional upon passage of time.

Contract assets consist of unbilled revenue which arises when the Company satisfies the performance obligation in the Refractory Management Services contracts but does not have an unconditional right to consideration as it is dependent on the certification of the report on the quantity of steel produced. Contract asset usually gets converts to Trade Receivables within a time period of 30 days.

Significant judgements in the application of the Standard

Note 40: Merger

On 31 July, 2018 the Board of Directors of the Company and its fellow subsidiaries i.e. RHI India Private Limited (''RHI India'') and RHI Clasil Private Limited (''RHI Clasil'') (hereinafter referred as ''erstwhile fellow subsidiaries''), had granted its in-principle approval to the scheme of amalgamation of RHI India and RHI Clasil with and into the Company with the proposed appointed date of 01 January, 2019 or such other date as may be fixed by the Tribunal (''the Scheme''). The National Company Law Tribunal, Mumbai (''NCLT'') vide its order dated 05 May, 2021 approved and sanctioned the Scheme with an appointed date of 31 July, 2018 in view of the order passed by the National Company Law Appellate Tribunal (''NCLAT'').

During the year ended 31 March, 2021, the Company accounted for the Scheme in accordance with clause 3.7 of the Scheme which requires the accounting treatment to be carried out as prescribed under applicable accounting standards that is, from the beginning of the preceding year i.e. 01 April, 2019 onwards and in accordance with Ind AS 103, Business Combination. Total consideration payable being '' 408.57 lacs was disclosed as Shares Pending Issuance under Equity. The reserves in the financial statements of the erstwhile fellow subsidiaries were disclosed in the same form in the Standalone Financial Statements of the Company. The difference between the consideration disclosed as Shares Pending Issuance and the Share Capital of the erstwhile fellow subsidiaries on 01 April, 2019 was '' 1,465.71 lacs, was disclosed as Capital Reserve in the Standalone Financial Statements.

The issuance and allotment of the equity shares to the shareholders of its erstwhile fellow subsidiaries pursuant to the Scheme was completed on 25 June, 2021 through a duly convened meeting of the Board of Directors of the Company.

During the year, the Company has issued and allotted 4,08,57,131 equity shares to the shareholders of its erstwhile fellow subsidiaries which have also got listed on the Bombay Stock Exchange and the National Stock Exchange.

During the year, pursuant to the Scheme becoming effective, in accordance with clause 3.2 of the Scheme, the authorised share capital of the Company increased from '' 1,205 lacs to '' 3,080 lacs.

Also, during the year, the Company applied for change of its name from Orient Refractories Limited to RHI Magnesita India Limited which was approved by Registrar of Companies (ROC) on 02 July, 2021.

Note 41: Assessment of impact of COVID-19

In preparation of the Standalone Financial Statements for the year ended 31 March, 2022, the Company has taken into account the possible impact of COVID-19 and the related internal and external factors known to the management upto the date of approval of these Standalone Financial Statements to assess the carrying amount of its assets and liabilities. Based on the current assessment, the management is of the view that impact of COVID-19 on the operations of the Company and the carrying value of its assets and liabilities is not likely to be material as at 31 March, 2022. The management has also assessed that there are no events or conditions that impact the ability of the Company to continue as a going concern.

Note 42: Transfer Pricing

The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under Sections 92-92F of the Income-tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the international and domestic transactions entered into with the associated enterprise during the financial year and expects such records to be in existence latest by 30 November, 2022, as required by law. The Management confirms that its international and domestic transactions are at arm''s length so that the aforesaid legislation will not have any impact on the standalone financial statements, particularly on the amount of tax expenses and that of provision for taxation.

Note 43: Additional regulatory information required by Schedule III

(i) Details of benami property held

No proceedings have been initiated on or are pending against the company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

(ii) Borrowing secured against current assets

The Company has credit limits sanctioned from the banks on the basis of security of current assets (refer note 5(e)). During the year, the Company has not availed any borrowings from banks.

(iii) Wilful defaulter

The Company have not been been declared wilful defaulter by any bank or financial institution or government or any government authority.

(iv) Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

(v) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013.

(vi) Compliance with approved scheme(s) of arrangements

During the year, the Scheme was approved by NCLT. The Company has complied with the approved Scheme (refer note 40).

(vii) Utilisation of borrowed funds and share premium

(a) 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:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

(i) 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

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

(viii) Undisclosed income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

(ix) Details of crypto currency or virtual currency

The company has not traded or invested in crypto currency or virtual currency during the current or previous year.

(x) Valuation of property, plant and equipment and intangible assets

The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

(xi) Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

(xii) Utilisation of borrowings availed from banks and financial institutions

The borrowings obtained by the company from banks and financial institutions have been applied for the purposes for which such loans were taken.

(xiii) Reclassification

The Ministry of Corporate Affairs amended the Schedule III to the Companies Act, 2013 on 24 March, 2021 to include certain additional disclosures or to improve relevance of information effective from 01 April, 2021. Accordingly, the Company has reclassified comparative amounts to conform with current year presentation as per the requirements of Ind AS 1 as under:

All amounts disclosed in the standalone financial statements and notes have been rounded off to the nearest lacs as per the requirement of Schedule III, unless otherwise stated.

Mar 31, 2021

(F) Risk Exposures:

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Salary Increases: Actual salary increases will increase the Plan''s liability. Increase in salary increase rate assumption in future valuations will also increase the liability.

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

Discount Rate: Reduction in discount rate in subsequent valuations can increase the plan''s liability.

(G) Defined benefit liability and employer contribution

Defined benefit liability and employer c0ntribution

The Company monitors the deficit in defined benefit obligation ( net off plan assets) and endevours to meet such deficit within reasonable future. The objective is to ensure adequate investments of funds, at appropriate time, to generate sufficient corpus for future payments.

*Cash Credit from Bank is guaranteed by RHI Magnesita, Austria the ultimate holding company. The cash credit is repayable on demand and carries an Interest at 9.15% p.a computed on a daily basis on actual amount utilised.

**Bank overdraft are secured against the corporate guarantee issued by Subsidiary of Ultimate Holding Company, RHI Magnesita GmbH

For current maturities of long term debt refer note 12(b)

Term loan 1: External commercial borrowing of EUR 450,000 was taken from the VRD Americas B.V. Netherland (fellow subsidiary), during the financial year 2013-14 which carries interest at applicable 3 month Euribor plus 200 basis points. It is repayable in single installment of EUR 450,000 on 31 December 2020. This term loan has been paid in full and there is no due as at March 31, 2021.

Term loan 2: External commercial borrowing of EUR 3,000,000 was taken from the VRD Americas B.V. Netherland (fellow subsidiary) during the financial year 2014-15 which carries interest at applicable 6 month Euribor plus 200 basis points. It is repayable in single installment of EUR 3,000,000 on 31 December 2022.

Term loan 3: External commercial borrowing of EUR 3,950,000 was taken from the VRD Americas B.V. Netherland (fellow subsidiary) during the financial year 2016-17 which carries interest at applicable 6 month Euribor plus 150 basis points. It is repayable in single installment of EUR 3,950,000 on 31 December 2023.

Financial Risk Management

The Company''s activities expose it to market risk, liquidity risk and credit risk.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk:

Other financial assets primary includes security deposits given to state electricity board and other public sector organisations, wherein possibility of any loss is remote. These deposits are given in the normal course of the business operations.

The Company believes that its liquidity position is adequate to fund the operating and investing needs and to provide with flexibility to respond to further changes in the business environment.

C. 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 prices comprises three types of risk: currency rate risk, interest rate risk. Financial instruments affected by market risks include borrowings, foreign currency receivables and payables.

Note 25:

Capital management A. Risk Management

The Company''s objectives when managing capital is to safeguard their ability to continue as a going concern, so that it can continue to provide adequate returns to the shareholders.

Note 26:

Segment Information

The Company is primarily engaged in the business of manufacturing refractories and monolithics. Based on the information reported to the chief operating decision maker (CODM) for the purpose of resources'' allocation and assessment of performance, there is single business segment in accordance with the requirements of Indian Accounting Standard (Ind AS 108 on âOperating Segment Reporting'' notified under the Companies (Indian Accounting Standard) Rules, 2015.

Geographical Segments

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India

Revenue from contracts for total refractory management services, revenue is recognized over time on the basis using the output-oriented method (e.g. quantity of steel produced by the customer).

Revenue from providing services is recognized in the accounting period in which the services ae rendered.

Performance obligations

Transaction price allocated to the remaining performance obligations

The contract assets primarily relate to the company''s right to consideration for work completed but not billed at the reporting date. The contract assets are transferred to receivables when the right become unconditional. The contract liabilities primarily relate to the advance consideration received from customers.

Significant judgements in the application of the Standard

For Refractory Management Contracts where the transaction price depends on the customer''s production performance, the management has determined that both supply of goods and services are not distinct as the customer expects total refractory management services from the Component, which includes supply of refractory material and its related services to produce steel. The customer expects complete refractory management for the agreed product areas in the steep plant in order to enable steel production. Thus, only one single performance obligation, performance of refractory management service, exists.

Note 34:

Merger

On 31 July, 2018 the Board of Directors of the Company and its fellow subsidiaries i.e. RHI India Private Limited (the ''RHI India'') and RHI Clasil Private Limited (the ''RHI Clasil'') (hereinafter referred as ''erstwhile fellow subsidiaries''), had granted its in-principle approval to the scheme of amalgamation of RHI India and RHI Clasil with and into the Company with the proposed appointed date of 1 January, 2019 or such other date as may be fixed by the Tribunal (''the Scheme'').

The Scheme was filed before the National Company Law Tribunal, Mumbai (''NCLT'') and was rejected by them vide order dated 02 March, 2021.

An appeal was filed before the Hon''ble National Company Law Appellate Tribunal (''NCLAT'') and NCLAT vide its judgement dated 19 January, 2021 allowed the said appeal and directed the NCLT to approve the said Scheme with an appointed date of 31 July, 2018.

The NCLT vide its Order dated 05 May, 2021 has approved the Scheme with an appointed date of 31 July, 2018 in view of the order passed by the NCLAT.

In accordance with the clause 3.5 of the Scheme, as a consideration of the merger of the Company with the erstwhile fellow subsidiaries, the Company will issue and allot to the shareholders of the erstwhile fellow subsidiaries the shares of the Company in the following manner: -

(i) To the shareholders of RHI India:

For every 100 equity shares of RHI India of face value of Rs. 10 each held in RHI India, every shareholder of the RHI India, shall without any application, act or deed, be entitled to receive 7,044 equity shares of face value of Re. 1 each of the Company, credited as fully paid up on the same terms and conditions of issue as prevalent in the Company; and

(ii) To the shareholders of RHI Clasil:

For every 1000 equity shares of RHI Clasil of face value of INR 10 each held in RHI Clasil, every shareholder of the RHI Clasil, shall without any application, act or deed, be entitled to receive 908 equity shares of face value of Re. 1 each of the Company, credited as fully paid up on the same terms and conditions of issue as prevalent in the Company.

The Company has prepared these Standalone Financial Statements after considering effect in accordance with clause 3.7 of the Scheme which requires the accounting treatment to be carried out as prescribed under applicable accounting standards that is, from the beginning of the preceding year and in accordance with Ind AS 103, Business Combination. The corresponding figures in these Standalone Financial Statements have been prepared by the management based on the audited financial statements of the Company and its erstwhile fellow subsidiaries as adjusted for giving effect to the Scheme as approved by the NCLT. The consideration payable to the shareholders of erstwhile fellow subsidiaries, amounting to Rs. 408.57 lacs has been disclosed as Shares Pending Issuance under Equity. The reserves in the financial statements of the erstwhile fellow subsidiaries have been disclosed in the same form in the financial statements of the Company. The difference between the consideration disclosed as Shares Pending Issuance and the Share Capital of the erstwhile fellow subsidiaries on 01 April, 2019 is Rs. 1,465.71 lacs, which has been disclosed as Capital Reserve in these Standalone Financial Statements.

Pursuant to the Scheme becoming effective, in accordance with clause 3.2 of the Scheme, the authorised share capital of the Company has been increased from Rs. 1,205 lacs to Rs. 3,080 lacs.

On 11 June, 2021 the Board of Directors of the Company took on record the sanction of the Scheme by the NCLT, change in the authorised share capital and have fixed the record date as 24 June, 2021 for the purpose of determining the shareholders of its erstwhile fellow subsidiaries who shall be entitled to receive the shares of the Company.

Change in authorised share capital has been approved by the Registrar of Companies (ROC) on 24 June, 2021.

After the issuance and allotment of the equity shares to the shareholders of its erstwhile fellow subsidiaries, the Company will complete the necessary steps to have the equity shares listed on Bombay Stock Exchange and the National Stock Exchange. Further, pursuant to the issuance and allotment of shares to the shareholders of its erstwhile fellow subsidiaries, the shareholding of the Company will change for which the necessary filings in accordance with the SEBI regulations will be done.

Pursuant to the approval of the Scheme by the Board of Directors of the Company, the intimation of the Scheme and the Record date has been sent to the Bombay Stock Exchange and the National Stock Exchange. Further, the orders of NCLAT and NCLT along with the Scheme have been filed with the ROC and ROC has approved on 24 June, 2021.

Further, the Company has applied for change of name and the approval of ROC is awaited.

Note 35:

Acquisition of Subsidiary

The Board of Directors on 30 April, 2019 approved the acquisition of the entire paid-up equity share capital of âIntermetal Engineers India Private Limitedâ (the âIEIPLâ) a company comprising of 1,597 equity shares of Rs.100/- each to make it a wholly owned subsidiary of the Company. The process of acquisition of IEIPL was completed on 18 May, 2019. The Company has paid consideration of Rs. 1,012.52 Lacs for the acquisition of IEIPL.

Note 36:

Acquisition of group of assets

During the year ended 31 March, 2020, the Company has completed the acquisition of group of assets from Manishri Refractories and Ceramics Private Limited, for a total consideration of Rs. 4,376 lacs. The group of assets include Land, Building and Plant and Machinery. The acquisition of assets has been appropriately recorded as per the requirements of Ind AS 16 and the valuation of Land and Building has been determined based on valuation done by an independent valuer.

Note 37:

Assessment of impact of Covid-19

In preparation of the standalone financial statements for the year ended 31 March, 2021, the Company has taken into account the possible impact of COVID-19 and the related internal and external factors known to the management upto the date of

approval of these standalone financial statements to assess the carrying amount of its assets and liabilities. Based on the current assessment, the management is of the view that impact of COVID-19 on the operations of the Company and the carrying value of its assets and liabilities is not likely to be material as at 31 March, 2021. The management has also assessed that there are no events or conditions that impact the ability of the Company to continue as a going concern.

Note 38:

Transfer Pricing

The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under Sections 92-92F of the Income-tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the international and domestic transactions entered into with the associated enterprise during the financial year and expects such records to be in existence latest by 30 November, 2021, as required by law. The Management confirms that its international and domestic transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expenses and that of provision for taxation.

Note 39:

Rounding of amounts

All amounts disclosed in the standalone financial statements and notes have been rounded off to the nearest lacs as per the requirement of Schedule III, unless otherwise stated.

Note 40:

Previous year''s figures

Previous year''s figures have also been regrouped / recasted, wherever necessary, to conform to the current year''s presentation.

Mar 31, 2019

1. Corporate Information

Orient Refractories Limited (âthe Companyâ), domiciled and incorporated in India and publicly traded on the National Stock Exchange (âNSEâ) and the Bombay Stock Exchange (âBSEâ) in India. The registered office of the Company is situated at C-604, Neelkanth Business Park, Opposite Railway Station, Vidhyavihar (West),Mumbai, Maharshtra-400086, India. The Company is primarily engaged in the business of manufacturing and trading of refractories, monolithics and ceramic paper and has a manufacturing facility in Bhiwadi (Rajasthan).

The financial statements were approved by the Board of Directors and authorised for issue on May 28, 2019.

Terms and rights attached to equity shares

Equity share has a par value of Rs. 1. They entitle the holder to participate in dividend, and to share in the proceeds of winding up of the company in proportion to number of and amounts paid on shares held.

Every holder of equity shares present at a meeting in person or proxy, is entitled to one vote, and upon a poll each share is entitled one vote.

(i) Leave obligations

The leave obligation cover the companyâs liability for earned leave.

The entire amount of provision of Rs. 409.30 Lacs ( 31 March 2018 - Rs. 356.91 Lacs ) is presented as current, since the Company does not have an unconditional right to defer settlement for any of these obligations. However, based on past experience, the Company does not expect all employees to avail the full amount of accrued leaves or require payment for such leave within the next 12 months.

(ii) Defined Contribution Plan

The Company has certain defined contribution plans including provident fund. Contributions are made to provident fund for employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The obligation of the company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognised during the year towards defined contribution plan is Rs. 207.74 Lacs (31 March 2018 - Rs. 195.05 Lacs).

(ii) Defined Benefit Plan - Gratuity

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The gratuity plan is a funded plan and the company makes contribution to recognised funds in India. The Company does not fully fund the liability and maintains the target level of funding to be maintained over a period of time based on estimations of expected gratuity payments.The gratuity fund plan assets of the company are managed by Orient Refractories Employees Group Gratuity Trust through Kotak Gratuity Group Plan. As per the information provided by the Kotak Mahindra Old Mutual Life Insurance Limited, 100% of the plan assets has been invested in the Kotak Group Bond fund managed by the Insurer.

(A) Risk Exposures:

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Salary Increases: Actual salary increases will increase the Planâs liability. Increase in salary increase rate assumption in future valuations will also increase the liability.

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

Discount Rate: Reduction in discount rate in subsequent valuations can increase the planâs liability.

Mortality & disability: Actual deaths & disability cases proving lower or higher than assumed in the valuation can impact the liabilities.

Withdrawals: Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent valuations can impact Planâs liability.

(B) Defined benefit liability and employer contribution

The Company monitors the deficit in defined benefit oblgation ( net off plan assets) and endevours to meet such deficit within reasonable future. The objective is to ensure adequate investments of funds, at appropriate time, to generate sufficient corpus for future payments.

*Goods and Services Tax (GST) has been effective from July 1, 2017. Consequently, excise duty, value added Tax (VAT) , Service tax etc. have been replaced with GST. Until June 30, 2017, âSale of productsâ included the amount of excise duty recovered on sales. With effect from 1 July 2017 âSales of productsâ excludes the amount of GST recovered. Accordingly, revenue from âSale of Productsâ and âRevenue from operationsâ for the year ended 31 Marchs, 2019 are not comparable with those of the previous year.

# Including Sales of Goods Rs. 20,738.12 Lacs (Previous Year Sale of Goods Rs. 16,930.83 Lacs).

Financial Risk Management

The Companyâs activities expose it to market risk, liquidity risk and credit risk.

The Companyâs senior management has the overall responsibility for establishing and governing the Companyâs risk management framework. The Companyâs risk management policies are established to identify and analyse the risks faced by the Company, to set and monitor appropriate risk limits and controls, periodically review the changes in market conditions and reflect the changes in the policies accordingly. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk:

A. Credit Risk

Investments primarily includes investments in debt based mutual funds, which are with registered fund houses and therefore risk of any loss is low.

The credit risk is managed by the company through credit term approvals, establishing the financial reliability of the customers taking into account the financial condition, analysis of historical bad debts and ageing of account receivables. Outstanding customer receivables are regularly monitored. Individual credit terms are set accordingly by the company credit control department.

B. Liquidity Risk

Liquidity risk is the risk that the Company will not be able to settle or meet its obligations on time. The Companyâs primary sources of liquidity are cash generated from operations. The cash flows from operating activities are driven primarily by operating results and changes in the working capital requirements.

The Company believe that its liquidity position is adequate to fund the operating and investing needs and to provide with flexibility to respond to further changes in the business environment.

C. Market Risk

Foreign currency risk: The Company operates internationally and is exposed to foreign exchange risk in relation to operating activities (when revenue or expense is denominated in a foreign currency) arising from foreign currency transactions, primarily with respect to the USD and EUR. The Company manages the exposure through natural hedging, by maintaining appropriate balances of receivables and payables within same currency. The Company also has policies to enter into foreign currency financial contracts in order to manage the impact of changes in foreign exchange rates on the results of operations and future foreign currency denominated cash flows. Forward exchange contracts are not intended for trading or speculative purposes but only for hedge purposes.

The Company does not have material foreign currency exposure.

Note 2:

Capital management A. Risk Management

The Companyâs objectives when managing capital is to safeguard their ability to continue as a going concern, so that it can continue to provide adequate returns to the shareholders.

The Company does not have any borrowings and the entire capital comprises of equity.

Note 3:

Segment Information

The Company is primarily engaged in the business of manufacturing refractories and monolithics. Based on the information reported to the chief operating decision maker (CODM) for the purpose of resourcesâ allocation and assessment of performance, there is single business segment in accordance with the requirements of Indian Accounting Standard (Ind AS) 108 on âOperating Segment Reportingâ notified under the Companies (Indian Accounting Standard) Rules, 2015.

Geographical Segments

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India

All other assets (other than trade receivables) used in the Companyâs business are located in India and are used to cater to both the categories of customers (within India and outside India), accordingly the total cost incurred during the year to acquire tangible and intangible fixed assets has not been disclosed.

(i) No provision is considered necessary since the Company expects favourable decisions.

(ii) Paid under protest of Rs. 3.09 Lacs (31 March, 2018, Rs. 5.36 Lacs)

These represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages professional advisors to protect its interests and has been advised that it has strong legal positions against such disputes. It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings.

(iii) The Company is in the process of evaluating the impact of the recent Supreme Court Judgment in case of âVivekananda Vidyamandir And Others Vs The Regional Provident Fund Commissioner (II) West Bengalâ and the related circular (Circular No. C-I/1(33)2019/Vivekananda Vidya Mandir/284) dated March 20, 2019 issued by the Employeesâ Provident Fund Organisation in relation to non-exclusion of certain allowances from the definition of âbasic wagesâ of the relevant employees for the purposes of determining contribution to provident fund under the Employeesâ Provident Funds & Miscellaneous Provisions Act, 1952. In the assessment of the management which is supported by legal advice, the aforesaid matter is not likely to have a significant impact and accordingly, no provision has been made in these Financial Statements.

(iii) The Company did not have any long term commitments/contracts including derivative contracts for which there were any material foreseeable losses.

Note 4 (a):

Operating lease

The Companyâs cancellable operating lease arrangement mainly consists of residential premises and offices taken on lease for periods ranging between 1-5 years. Terms of lease include terms for renewal, increase in rents in future periods and terms of cancellation.

The Company does not have any non-cancellable lease. Expense incurred during the year is Rs 37.98 lacs (Rs 30.98 lacs for the year ended 31 March, 2018).

Impact of application of Ind AS 115 Revenue from Contracts with Customers

The Company has applied Ind AS 115 retrospectively only to contracts that are not completed as at the date of initial application, with the cumulative effect of initial application recognised as an adjustment to the opening balance of retained earnings at April 1, 2018. In accordance with the transition guidance in Ind AS 115 has only been applied to contracts that are incomplete as at April 1, 2018.

The Companyâs accounting policies for its revenue streams are disclosed in note 15. Apart from providing more extensive disclosures on the companyâs revenue transactions, the application of Ind AS 115 has not had a significant impact on the financial position and/or financial performance of the Company.

Revenue from contracts with customers ( refer note 15)

* Goods and Services Tax (GST) has been effective from July 1, 2017. Consequently, excise duty, value added Tax (VAT) , Service tax etc. have been replaced with GST. Until June 30, 2017, âSale of productsâ included the amount of excise duty recovered on sales. With effect from 1 July 2017 âSales of productsâ excludes the amount of GST recovered. Accordingly, revenue from âSale of Productsâ and âRevenue from operationsâ for the year ended 31 March, 2019 are not comparable with those of the previous year.

# Including Sales of Goods Rs. 20,738.12 Lacs (Previous Year Sale of Goods Rs. 16,930.83 Lacs).

Disaggregation of Revenue

In the following tables, revenue is disaggregated by product group and by geography. This is consistent with the revenue information that is disclosed for each reportable segment under Ind AS 108 (refer note 26). The Company believes that this disaggregation best depicts how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by industry, market and other economic factors.

Timing of Revenue Recognition

Revenue from sale of products is transferred to the customers at a point in time, whereas revenue from refractory management services is transferred over a period of time. Other revenue is transferred at a point in time.

Performance obligations

Revenue from the sale of products is recognised at the point in time when control over the products is passed to the customers, which is determined based on the individual Incoterms agreed in the customer contract. Control is defined as the ability to direct the use and obtain substantially all the economic benefits from an asset. For the incoterms CIF (Cost, Insurance and Freight), transport service gives rise to a separate performance obligation to which a part of revenue has to be allocated, as this service is performed after the control of the product is transferred to the customer.

For Refractory Management services where the transaction price depends on the customerâs production tonnage the management has determined that both supply of goods and services are not distinct as the customer expects total refractory management services from the Component, which includes supply of refractory material and its related services to produce steel. Thus, only one single performance obligation, the performamce of refractory management services, exists. With regard to these contracts, revenue is recognised over time using the output-oriented method (e.g. quantity of steel produced).

Transaction price allocated to the remaining performance obligations

Transaction price is the expected consideration to be received in exchange for transferring goods or services, to the extent that it is highly probable that there will not be a significant reversal of revenue. For Refractory Management Contracts, transaction price depends on the customerâs production performance. The Company applies practical expedient in Ind AS 115. Accordingly it does not disclose information about remaining performance obligations wherein the Company has a right to consideration from customer in an amount that directly corresponds with the value to the customer of entityâs performance till date using the output method and for the other contracts which have original expected durations of one year or less.

Trade Receivables and Contract Balances

The Company classifies the right to consideration in exchange for deliverables as either a receivable or as Contract Asset.

A receivable is a right to consideration that is unconditional upon passage of time.

Contract assets consist of unbilled revenue which arises when the Company satisfies the performance obligation in the Refractory Management Services contracts but does not have an unconditional right to consideration as it is dependent on the certification of the report on the quantity of steel produced. Contract asset usually gets converted to Trade Receivables within a time period of 30 days. Contract assets were previously presented as part of other Financial Assets.

Contract liabilities consists of advances from customers. These were previously presented as part of Other Current Liabilities.

Contract liabilities typically have a turn around time period of approximately 30-90 days.

Trade receivables are presented net off impairment loss in note 5(b).

Contract liabilities are presented in note 14A

The contract assets primarily relate to the companyâs right to consideration for work completed but not billed at the reporting date. The contract assets are transferred to receivables when the right become unconditional. The contract liabilities primarily relate to the advance consideration received from customers.

Significant judgements in the application of the Standard

For Refractory Management Contracts where the transaction price depends on the customerâs production performance, the management has determined that both supply of goods and services are not distinct as the customer expects total refractory management services from the Component, which includes supply of refractory material and its related services to produce steel. The customer expects complete refractory management for the agreed product areas in the steep plant in order to enable steel production. Thus, only one single performance obligation, performance of refractory management service, exists.

Note 5: Merger

On July 31, 2018 the Audit Committee and Board of Directors of the Company, RHI India Private Limited (RHI India) and RHI Clasil Private Limited (RHI Clasil), approved the proposed merger of RHI India and RHI Clasil with and into the Company with the proposed appointed date of January 1, 2019. The Company is in the process of obtaining the necessary approvals for the proposed merger. These financial statements have been prepared without considering impact, if any, of the proposed merger.

All amounts disclosed in the financial statements and notes have been rounded off to the nearest lacs as per the requirement of Schedule III, unless otherwise stated.

Note 6 : Previous yearâs figures

Previous yearâs figures have also been regrouped / recasted, wherever necessary, to conform to the current yearâs presentation.

The above statement of cash flows should be read in conjuction with the accompanying notes.

Mar 31, 2018

1. Corporate Information

ORIENT REFRACTORIES LIMITED (âthe Companyâ), domiciled and incorporated in India and publicly traded on the National Stock Exchange (âNSEâ) and the Bombay Stock Exchange (âBSEâ) in India. The registered office of the Company is situated at 804-A Chiranjiv Tower 43, Nehru Place, New Delhi, India. The Company is primarily engaged in the business of manufacturing and trading of refractories, monolithics and ceramic paper and has a manufacturing facility in Bhiwadi (Rajasthan).

The financial statements were approved by the Board of Directors and authorised for issue on 17 May, 2018.

(i) Defined Contribution Plan

The company has certain defined contribution plans including provident fund. Contributions are made to provident fund for employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The obligation of the company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognised during the year towards defined contribution plan is Rs. 195.05 lacs (31 March, 2017 - Rs. 180.17 lacs).

(ii) Defined Benefit Plan - Gratuity

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The gratuity plan is a funded plan and the company makes contribution to recognised funds in India. The Company does not fully fund the liability and maintains the target level of funding to be maintained over a period of time based on estimations of expected gratuity payments. The gratuity fund plan assets of the company are managed by Orient Refractories Employees Group Gratuity Trust through Kotak Gratuity Group Plan. As per the information provided by the Kotak Mahindra Old Mutual Life Insurance Limited, 100% of the plan assets has been invested in the Kotak Group Bond fund managed by the Insurer.

The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes 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 recognised in the balance sheet. The methods and types of assumptions used in preparation, the sensitivity analysis did not change compared to the prior period.

(D) Risk Exposures

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Salary Increases: Actual salary increases will increase the Planâs liability. Increase in salary increase rate assumption in future valuations will also increase the liability.

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

Discount Rate: Reduction in discount rate in subsequent valuations can increase the planâs liability.

Mortality & disability: Actual deaths & disability cases proving lower or higher than assumed in the valuation can impact the liabilities.

Withdrawals: Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent valuations can impact Planâs liability.

(E) Defined benefit liability and employer contribution

The company monitors the deficit in defined benefit obligation ( net off plan assets) and endevours to meet such deficit within reasonable future. The objective is to ensure adequate investments of funds, at appropriate time, to generate sufficient corpus for future payments.

*Goods and Services Tax (GST) has been effective from 1 July, 2017. Consequently, excise duty, value added Tax (VAT) , Service tax etc. have been replaced with GST. Until 30 June, 2017, âSale of productsâ included the amount of excise duty recovered on sales. With effect from 1 July, 2017 âSales of productsâ excludes the amount of GST recovered. Accordingly, revenue from âSale of Productsâ and âRevenue from operationsâ for the year ended 31 March, 2018 are not comparable with those of the previous year.

The fair value of deposits with open ended mutual fund scheme is classified as level 1 in the fair value hierarchy. The value is measured using net asset value (NAV) as disclosed by the mutual fund house. The carrying value of the financial assets, other than deposits with open ended mutual fund scheme, closely approximates the fair value.

Note 2:

Financial Risk Management

The Companyâs activities expose it to market risk, liquidity risk and credit risk. The Companyâs senior management has the overall responsibility for establishing and governing the Companyâs risk management framework. The Companyâs risk management policies are established to identify and analyse the risks faced by the Company, to set and monitor appropriate risk limits and controls, periodically review the changes in market conditions and reflect the changes in the policies accordingly. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk:

A. Credit Risk

Investments primarily includes investments in debt based mutual funds, which are with registered fund houses and therefore risk of any loss is low.

To address the risk of any potential non recovery from trade receivables, the Company has the practice of reviewing debtors having balances outstanding for more than 180 days as at period end and consider them for provision for bad and doubtful debts. Besides this, wherever there is specific evidence about the deteriorating financial position, downfall in business, intention to not pay or other similar factors of the customer, the management reviews the underlying facts and merits of such cases to evaluate the need to adjust provision, as computed based on ageing analysis. This provision, based on collective analysis, is sufficient to cover the entire lifetime loss of revenues recognised including those that are currently less than 180 daysâ outstanding and not provided for.

B. Liquidity Risk

The Company believe that its liquidity position is adequate to fund the operating and investing needs and to provide with flexibility to respond to further changes in the business environment.

C. Market Risk

Note 3:

Capital management

A. Risk Management

The Companyâs objectives when managing capital is to safeguard their ability to continue as a going concern, so that it can continue to provide adequate returns to the shareholders. The Company does not have any borrowings and the entire capital comprises of equity.

B. Dividend

Note 4:

Segment Information

The Company is primarily engaged in the business of manufacturing refractories and monolithics. Based on the information reported to the chief operating decision maker (CODM) for the purpose of resourcesâ allocation and assessment of performance, there is single business segment in accordance with the requirements of Indian Accounting Standard (Ind AS) 108 on âOperating Segment Reportingâ notified under the Companies (Indian Accounting Standard) Rules, 2015.

Geographical Segments

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India

*No provision is considered necessary since the Company expects favourable decisions.

** Paid under protest of Rs.5.36 lacs (31 March, 2017- Rs.11.07 lacs)

These represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages professional advisors to protect its interests and has been advised that it has strong legal positions against such disputes. It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings.

Note 5(a):

Capital and other commitments

(i) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of capital advances):

(iii) The Company did not have any long term commitments/contracts including derivative contracts for which there were any material foreseeable losses.

Note 5 (b):

Operating lease

The company does not have any non-cancellable lease. Expense incurred during the year is Rs 30.98 lacs (Rs 27.06 lacs for the year ended 31 March, 2017).

Note 6:

Related Party Transactions

(a) Parent entities

The Company is controlled by the following

(b) Key managerial personnel (KMP)

Mr. Parmod Sagar, Managing Director & CEO

(c) List of related parties

i) Fellow subsidiaries with whom the Company had transactions during the year

RHI Feuerfest GmbH, Austria RHI India Private Limited, Mumbai Refractory Intellectual Property GmbH & Co Kg, Austria RHI Refractories Asia Pacific PTE Ltd,Singapore Stopinc Aktiengesellschaft, Switzerland

ii) Entity where ultimate holding company have significant influence RHI Clasil Private Limited, Mumbai

iii) Relative of KMP

Mr. Christophar Parvesh

Note 7:

First-time adoption of Ind AS Transition to Ind AS

These are the Companyâs first financial statements prepared in accordance with Ind AS. The accounting policies set out in Note 1, have been applied in preparing the financial statements for the year ended 31 March, 2018, the comparative information presented in these financial statements for the year ended 31 March, 2017 and in the preparation of opening Ind AS balance sheet as at 1 April, 2016. In preparing its opening balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the Companyâs financial position, financial performance and cash flows is set out in the following tables and notes.

A Exemptions availed

A.1 Ind AS optional exemptions

A.1.1 Deemed cost:

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for decommissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible assets. Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying values as at 1 April, 2016.

A.2 Ind AS mandatory exemptions

A.2.1 De-recognition of financial assets and liabilities:

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entityâs choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities de-recognised as a result of past transactions was obtained at the time of initially accounting for those transactions. The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

A.2.2 Classification and measurement of financial assets:

Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

A.2.3 Estimates:

An entityâs estimates in accordance with Ind AS on the date of transition shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. Ind AS estimates as at 1 April, 2016 are consistent with estimates as at the same date made in confirmity with previous GAAP. The company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

- Investment in debt instruments carried at FVPL ; and

- Expected credit loss for trade receivables

The Ind AS estimates closely approximate to estimates used in the previous GAAP.

B. Reconciliation between previous GAAP and Ind AS

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliation from previous GAAP to Ind AS

Note 8:

Leases

Under previous GAAP, the leasehold land was disclosed as property plant and equipment, however under Ind AS the arrangement is considered as operating lease and therefore, unexpensed amount as at 1 April, 2016 and 31 March, 2017 is classified in into current and non-current asset, considering the expected charge over the remaining lease period.

Note 9:

Proposed Dividend

Under the previous GAAP, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognised as a liability. Under Ind AS, such dividends are recognised when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend of Rs.2,096.65 lacs as at 1 April, 2016 included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity fluctuated by an equivalent amount.

Note 10:

Excise Duty

Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented on the face of the statement of profit and loss as part of expenses. This change has resulted in an increase in total revenue and total expenses for the year month ended 31 March, 2017 by Rs. 3,681.55 lacs. There is no impact on the total equity and profit.

Note11:

Remeasurements of post-employment benefit obligations

Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. As a result of this change, the profit for the year ended 31 March, 2017 increased by Rs. 44.47 lacs. The corresponding tax impact of Rs. 15.39 lacs is also classified to the other comprehensive income. There is no impact on total equity.

Mar 31, 2017

b. Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Re. 1 per share. The holder of each fully paid equity share is entitled to one vote. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

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

1 Pursuant to the scheme of arrangement between Orient Abrasives Limited (transferor company) and the Company, the refractory business of the transferor company carried out at its manufacturing unit at Bhiwadi (demerged undertaking), was transferred to the Company with effect from 1 April, 2011 (the appointed date). The said scheme under Section 391 to 394 of the Companies Act, 1956 was approved by the Hon''ble High Court of Delhi vide its order dated 19 September, 2011 and has been effective from 31 October, 2011 (âthe effective dateâ), i.e. date of filing the above order with the Registrar of Companies.

The said scheme provides, inter alia, the transfer of demerged undertaking on a going concern basis to the Company in consideration of which, each shareholder of Orient Abrasives Limited whose name appeared in the register of members of Orient Abrasives Limited on the record date i.e. 14 November, 2011, received one fully paid equity share of face value of Re.1 each in the Company.

The scheme provided for its basis of transfer of certain specific assets and liabilities and where not specifically provided in the scheme, it authorized the ''Board of Directors'' of both the companies to mutually decide through a resolution. In terms of above, the following was done in the financial year 2011-12:

i. The book value of assets, liabilities, reserves and surplus (as agreed) of the demerged undertaking as on the appointed date was accounted for as assets and liabilities and reserves in the books of the Company as on the appointed date. Following is the amount of such assets, liabilities and reserves:

ii. Loans as identified for the demerged undertaking and transferred from Orient Abrasives Limited were recorded in the books. Later on, the Company obtained its own credit facility and loans transferred from the transferor company were repaid.

iii. Aggregate face value of the new equity shares (1,196.39 lacs shares of Re. 1 each amounting to Rs.1,196.39 lacs) were issued by the Company to the members of the transferor company and was credited to the share capital account on the appointed date. The Company in its board meeting dated 15 November, 2011 allotted these shares. In view of the allotment of shares, the transferor Company ceased to be the holding company of the Company.

iv. The employees of the demerged undertaking were transferred to the Company on their existing terms of employment with the transferor Company.

v. All contingent liabilities relating to demerged undertaking were transferred to the Company on the appointed date.

vi. Deferred tax liability (net) pertaining to the demerged undertaking and as agreed by the Board of Directors were transferred to the Company.

The transferor company was carrying on business of demerged undertaking in trust on behalf of the Company for the period from the appointed date till the effective date.

2 Employee benefit plans

i. Defined contribution plans

The Company makes Provident Fund, National Pension Scheme and Employees'' State Insurance contributions which are defined contribution plans for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs.180.17 lacs (31 March, 2016: Rs.162.41lacs) for Provident Fund, Rs. 25.75 lacs (31 March, 2016: Rs. 20.58 lacs) for National Pension Scheme and Rs. 12.72 lacs (31 March, 2016: Rs. 14.82 lacs) for Employees'' State Insurance contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

ii. Defined benefit plans

The Company offers employee benefit schemes of Gratuity to its employees. Benefits payable to all employees of the Company with respect to gratuity, a defined benefit plan is accounted for on the basis of an actuarial valuation as at the balance sheet date.

The following table sets out the funded status of defined benefit schemes and the amount recognized in the financial statements:

The expected rate of return on plan assets is determined after considering several applicable factors, such as the composition of the plan assets, investment strategy, market scenario etc. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified. The gratuity fund plan assets of the Company are managed by Orient Refractories Employees Group Gratuity Trust through Kotak Gratuity Group Plan. As per the information provided by the Kotak Mahindra Old Mutual Life Insurance Limited, 100% of the plan assets has been invested in the funds managed by the Insurer.

The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet date for the estimated term of the obligations.

3 Segment information Business Segments:

The Company is primarily engaged in the business of manufacturing and selling of refractories and monolithic. The entire operations are governed by the same set of risk and returns and, hence, the same has been considered as representing a single primary segment.

Since the Company''s business activity falls within a single business segment, there are no additional disclosures to be provided under Accounting Standard-17 ''Segment Reporting'' other than those already provided in the financial statements.

Geographical Segments:

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India.

Secondary Segment Reporting (by Geographical Segments)

The following is the distribution of the Company''s total revenue of operations by geographical market, regardless of where the goods were produced:

All other assets (other than trade receivables) used in the Company''s business are located in India and are used to cater to both the categories of customers (within India and outside India), accordingly the total cost incurred during the year to acquire tangible and intangible fixed assets has not been disclosed.

4 Related party transactions: A. Details of Related Parties a. Ultimate holding company

RHI AG, Austria

b. Holding company

Dutch US Holding B.V., Netherlands

c. Fellow subsidiaries

RHI Clasil Private Limited

RHI India Private Limited

RHI Refractories Asia Ltd, Hong Kong

Veitsch Radex America LLC, USA

RHI Refractories UK Ltd

Veitsch Radex GMBH & Co OG, Austria

Refractory Intellectual Property GMBH & Co Kg, Austria

RHI Refractories Asia Pacific PTE Ltd,Singapore

d. Key Managerial Personnel (KMP)

Mr. Parmod Sagar, Managing Director

Mr. Subhash Chander Sarin, Executive Director (up to 30 April, 2015)

Mr. Shri Gopal Rajgarhia, Executive Director (up to 8 April, 2015)

e. Relative of KMP

Ms. Anisha Mittal (Mr. Shri Gopal Rajgarhia''s daughter) (up to 8 April, 2015)

Mr. Christophar Parvesh (Mr. Parmod Sagar''s brother)

f. Entities in which KMP/Relatives of KMP can exercise significant influence

Orient Abrasives Limited (up to 8 April, 2015)

Hindustan General Industries Limited (up to 8 April, 2015)

* For the purposes of this note, the term ''Specified Bank Notes'' shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated 8 November, 2016.

5. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

6. Expenditure on corporate social responsibility

a) Gross amount required to be spent by the Company during the year ended 31 March, 2017: Rs.181.58 lacs (including unspent amount Rs. 21.08 lacs related to Previous year ended 31 March, 2016) (31 March, 2016: Rs.230.37 lacs).

Note: Figures in brackets pertain to the previous year.

7. Previous year figures

Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

Mar 31, 2016

1. Employee benefit plans

i. Defined contribution plans

The Company makes Provident Fund, National Pension Scheme and Employees'' State Insurance contributions which are defined contribution plans for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs. 162.41 lacs (31 March, 2015: Rs.148.37 lacs) for Provident Fund, Rs. 20.58 lacs (31 March, 2015: Rs. 15.35) for National Pension Scheme and Rs. 14.82 lacs (31 March, 2015: Rs. 15.08 lacs) for Employees'' State Insurance contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

ii. Defined benefit plans

The following table sets out the funded status of defined benefit schemes and the amount recognized in the financial statements:

The expected rate of return on plan assets is determined after considering several applicable factors, such as the composition of the plan assets, investment strategy, market scenario etc. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified. The gratuity fund plan assets of the Company are managed by Orient Refractoriness Employees Group Gratuity Trust through Kotak Gratuity Group Plan. As per the information provided by the Kotak Mahindra Old Mutual Life Insurance Limited, 100% of the plan assets has been invested in the funds managed by the Insurer.

The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet date for the estimated term of the obligations.

3. Segment information Business Segments:

The Company is primarily engaged in the business of manufacturing and selling of refractoriness and monolithic. The entire operations are governed by the same set of risk and returns and, hence, the same has been considered as representing a single primary segment.

Geographical Segments:

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India.

4. Related party transactions:

A. Details of Related Parties

a. Ultimate holding company

RHI AG, Austria

b. Holding company

Dutch US Holding B.V., Netherlands

c. Fellow subsidiaries

RHI Clasil Limited

RHI India Private Limited

RHI Refractories Asia Ltd, Hong Kong

RHI Urmitz AG & Co. KG, Germany

RHI Refractories Liaoning Co Ltd, China

Veitsch-Radex America LLC, USA

RHI Refractories UK Ltd

Veitsch-Radex GmbH & Co OG, Austria

Refractory Intellectual Property GmbH & Co KG, Austria

RHI Refractories Asia Pacific Pte Ltd, Singapore

d. Key Managerial Personnel (KMP)

Mr. Parmod Sagar, Managing Director

Mr. Subhash Chander Sarin, Executive Director (up to 30 April, 2015)

Mr. Shri Gopal Rajgarhia, Executive Director (up to 8 April, 2015)

e. Relative of KMP

Ms. Anisha Mittal (Mr. Shri Gopal Rajgarhia''s daughter) (up to 8 April, 2015)

Mr. Christophar Parvesh (Mr. Parmod Sagar''s brother)

f. Entities in which KMP/Relatives of KMP can exercise significant influence

Orient Abrasives Limited (up to 8 April, 2015)

APM Industries Limited (up to 8 April, 2015)

Hindustan General Industries Limited (up to 8 April, 2015)

Rovo Marketing Private Limited (up to 8 April, 2015)

5. Details of leasing arrangements

The Company has entered into operating lease arrangements for certain facilities and office premises. These are cancellable by giving notice and are renewable by mutual consent on mutually agreed terms. There is no lock in period.

6. Consequent to the enactment of the Companies Act, 2013 (the Act) and its applicability for accounting periods commencing after 1 April, 2014, the Company had reassessed the useful life of its fixed assets and had computed depreciation with reference to the useful life of assets recommended in Schedule II to the Act. The depreciation for the previous year was higher by Rs. 171.94 lacs consequent to the change in the useful life of assets. Further, depreciation related to the assets having written down value of Rs. 68.79 lacs as on 1 April, 2014, whose life had expired, had been adjusted from the opening balance of Surplus of Statement of Profit and Loss amounting to Rs. 45.41 lacs (net of deferred tax credit of Rs. 23.38 lacs).

7. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

8. Expenditure on corporate social responsibility

a) Gross amount required to be spent by the Company during the year ended 31 March, 2016: Rs.230.37 lacs (including unspent amount Rs 84.83 lacs related to Previous year ended 31 March, 2015) (31 March, 2015: Rs 124.00 lacs).

9. Previous year figures

Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

Mar 31, 2015

1. CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

(i) Contingent liabilities

Particulars As at As at 31 March, 2015 31 March, 2014

Claims against the Company not acknowledged as debts*

- Demand from income tax authorities 862.40 Nil

*No provision is considered necessary since the Company expects favorable decisions.

(ii) Commitments

Particulars As at As at 31 March, 2015 31 March, 2014

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of capital advances):

- Tangible assets 132.51 299.78

- Intangible assets 0.33 22.68

132.84 322.46

(iii) The Company has other commitments, for purchases/sales orders which are issued after considering requirements as per operating cycle for purchase/sale of goods and services and employee benefits, in normal course of business. The Company does not have any long term commitments/contracts including derivative contracts for which there will be any material foreseeable losses.

2. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

3. UNEXPIRED FOREIGN EXCHANGE FORWARD CONTRACTS

The following forward contracts are open as at 31 March, 2015. These transactions have been undertaken to act as economic hedges for the Company''s exposures to various risks in foreign exchange markets and may/may not qualify or be designated as hedging instruments.

(i). Forward exchange contracts, which are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency required or available at the settlement date of certain payables and receivables.

4. Pursuant to the scheme of arrangement between Orient Abrasives Limited (transferor company) and the Company, the refractory business of the transferor company carried out at its manufacturing unit at Bhiwadi (demerged undertaking), was transferred to the Company with effect from 1 April, 2011 (the appointed date). The said scheme under Section 391 to 394 of the Companies Act, 1956 was approved by the Hon''ble High Court of Delhi vide its order dated 19 September, 2011 and has been effective from 31 October, 2011 ("the effective date"), i.e. date of filing the above order with the Registrar of Companies.

The said scheme provides, inter alia, the transfer of demerged undertaking on a going concern basis to the Company in consideration of which, each shareholder of Orient Abrasives Limited whose name appeared in the register of members of Orient Abrasives Limited on the record date i.e. 14 November, 2011, received one fully paid equity share of face value of Rs. 1.00 each in the Company.

The scheme provided for its basis of transfer of certain specific assets and liabilities and where not specifically provided in the scheme, it authorized the ''board of directors'' of both the companies to mutually decide through a resolution. In terms of above, the following was done in the financial year 2011-12:

ii. Loans as identified for the demerged undertaking and transferred from Orient Abrasives Limited were recorded in the books. Later on, the Company obtained its own credit facility and loans transferred from the transferor company were repaid.

iii. Aggregate face value of the new equity shares (1,196.39 Lacs shares of Rs.1.00 each amounting to Rs.1,196.39 Lacs) were issued by the Company to the members of the transferor company and was credited to the share capital account on the appointed date. The Company in its board meeting dated 15 November, 2011 allotted these shares. In view of the allotment of shares, the transferor company ceased to be the holding company of the Company.

iv. The employees of the demerged undertaking were transferred to the Company on their existing terms of employment with the transferor company.

v. All contingent liabilities relating to demerged undertaking were transferred to the Company on the appointed date.

vi. Deferred tax liability (net) pertaining to the demerged undertaking and as agreed by the board of directors were transferred to the Company.

The transferor company was carrying on business of demerged undertaking in trust on behalf of the Company for the period from the appointed date till the effective date.

5. Employee benefit plans

i. Defined contribution plans

The Company makes Provident Fund, National Pension Scheme and Employees'' State Insurance contributions which are defined contribution plans for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs.148.37 Lacs (31 March, 2014: Rs. 119.20 Lacs) for Provident Fund, Rs. 15.35 Lacs(31 March, 2014: Rs. Nil) for National Pension Scheme and Rs. 15.08 Lacs (31 March, 2014: Rs. 17.91 Lacs) for Employees'' State Insurance contributions in the statement of profit and loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

ii. Defined benefit plans

The Company offers employee benefit schemes of gratuity to its employees. Benefits payable to all employees of the Company with respect to gratuity, a defined benefit plan is accounted for on the basis of an actuarial valuation as at the balance sheet date.

The estimates of future salary increases, considered in actuarial valuation, take into account of inflation, seniority, promotion and other relevant factors.

The expected rate of return on plan assets is determined after considering several applicable factors, such as the composition of the plan assets, investment strategy, market scenario etc.In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified. The gratuity fund plan assets of the Company are managed by Orient Refractoriness Employees Group Trust through Kotak Mahindra Old Mutual Life Insurance Ltd. The categories of plan assets as a percentage of total plan assets are based on information provided by Kotak Mahindra Old Mutual Life Insurance Ltd.

6. SEGMENT INFORMATION

Business Segments

The Company is engaged in the business of manufacturing and selling of refractoriness and monolithic. The entire operations are governed by the same set of risk and returns and, hence, the same has been considered as representing a single primary segment.

Since the Company''s business activity falls within a single business segment, there are no additional disclosures to be provided under Accounting Standard-17 ''Segment Reporting'' other than those already provided in the financial statements.

Geographical Segments

The analysis of geographical segment is based on the geographical location of the customers. The Company operates primarily in India and has presence in international markets as well. Its business is accordingly aligned geographically, catering to two markets i.e. India and Outside India. For customers located outside India, the Company has assessed that they carry same risk and rewards. The Company has considered domestic and exports markets as geographical segments and accordingly disclosed these as separate segments. The geographical segments considered for disclosure are as follows:

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India.

28.4 RELATED PARTY TRANSACTIONS: A. Details of related parties

a. Ultimate holding company

RHI AG, Austria (w.e.f. 26 April, 2013)

b. Holding company

Dutch US Holding B.V., Netherlands (w.e.f. 26 April, 2013)

c. Fellow subsidiaries

RHI Clasil Limited (w.e.f. 26 April, 2013)

RHI India Private Limited (w.e.f. 26 April, 2013)

RHI Refractories Asia Ltd, Hong Kong (w.e.f. 26 April, 2013)

RHI Urmitz AG & Co. KG, Germany (w.e.f. 26 April, 2013)

RHI Refractories Liaoning Co Ltd, China(w.e.f. 26 April, 2013)

Veitsch- Radex America LLC, USA (w.e.f.2 6 April, 2013)

RHI Refractories UK Ltd (w.e.f. 26 April, 2013)

d. Individuals/entities having significant influence over the Company through their voting rights of 20% or more

Dutch US Holding B.V., Netherlands (from 4 March, 2013 till 25 April, 2013)

e. Key Managerial Personnel (KMP)

Mr. Subhash Chander Sarin, Executive Director (up to 30 April, 2015)

Mr. Parmod Sagar, Managing Director

Mr. Shri Gopal Rajgarhia, Executive Director (up to 8 April, 2015)

f. Relative of KMP

Ms. Anisha Mittal, (Mr. Shri Gopal Rajgarhia''s daughter) Mr. Christophar Parvesh, (Mr. Parmod Sagar''s brother)

g. Entities in which KMP / relatives of KMP can exercise significant influence

Orient Abrasives Limited

APM Industries Limited

Hindustan General Industries Limited

Rovo Marketing Private Limited

7. Consequent to the enactment of the Companies Act, 2013 (the Act) and its applicability for accounting periods commencing after 1 April, 2014, the Company has reassessed the useful life of its fixed assets and has computed depreciation with reference to the useful life of assets recommended in Schedule II to the Act. The depreciation for the year is higher by Rs. 171.94 Lacs consequent to the change in the useful life of assets. Further, depreciation related to the assets having written down value of Rs. 68.79 Lacs as on 1 April, 2014, whose life had expired, has been adjusted from the opening balance of surplus of statement of profit and loss amounting to Rs. 45.41 Lacs (net of deferred tax credit of Rs. 23.38 Lacs).

8. During the year, the Corporate Social Responsibility (CSR) committee has been formed by the Company to monitor CSR related activities. The Company has contributed and expensed Rs. 39.17 Lacs out of the total contributable amount of Rs. 124.00 Lacs for the year ended 31 March, 2015 in accordance with Section 135 read with schedule VII of the Companies Act, 2013 to various trusts and social organization. The contributions have been made towards promoting education, sanitation, medical and society welfare activities. The management has not spent the remaining amount of Rs. 84.83 Lacs.

9. Previous year figures

Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

Mar 31, 2014

1. CORPORATE INFORMATION

Orient Refractories Limited (''the Company''), incorporated on 26 November, 2010 is engaged in manufacturing, production and distribution of refractories, monolithics and ceramic paper and has a manufacturing facility in Bhiwadi (Rajasthan).

2. TRANSFER PRICING

The Company has established a comprehensive system on maintenance of information and documents as required by the transfer pricing legislation under 92-92F of the Income Tax Act, 1961 and has documented Transfer Pricing Benchmarking study for financial year 2012-13. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the domestic and international transactions entered into with the associated enterprises during the year and expects such records to be in existence latest by the due date as required under law. The management is of the opinion that its international and domestic transactions are at arm''s length and the aforesaid legislation will not have any impact on the financial statements.

2.1 Pursuant to the scheme of arrangement between Orient Abrasives Limited (transferor company) and the Company, the refractory business of the transferor company carried out at its manufacturing unit at Bhiwadi (demerged undertaking), was transferred to the Company with effect from 1 April, 2011 (the appointed date). The said scheme under Section 391 to 394 of the Companies Act, 1956 was approved by the Hon''ble High Court of Delhi vide its order dated 19 September, 2011 and has been effective from 31 October, 2011 ("the effective date"), i.e. date of filing the above order with the Registrar of Companies.

The said scheme provides, inter alia, the transfer of demerged undertaking on a going concern basis to the Company in consideration of which, each shareholder of Orient Abrasives Limited whose name appeared in the register of members of Orient Abrasives Limited on the record date i.e. 14 November, 2011, received one fully paid equity share of face value of Rs. 1 each in the Company.

The scheme provided for its basis of transfer of certain specific assets and liabilities and where not specifically provided in the scheme, it authorized the ''Board of Directors'' of both the companies to mutually decide through a resolution. In terms of above, the following was done in the financial year 2011-12:

(i) The book value of assets, liabilities, reserves and surplus (as agreed) of the demerged undertaking as on the appointed date was accounted for as assets and liabilities and reserves in the books of the Company as on the appointed date. Following is the amount of such assets, liabilities and reserves:

(ii) Loans as identified for the demerged undertaking and transferred from Orient Abrasives Limited were recorded in the books. Later on, the Company obtained its own credit facility and loans transferred from the transferor company were repaid.

(iii) Aggregate face value of the new equity shares (1,196.39 Lacs shares of Rs. 1 each amounting to Rs. 1,196.39 Lacs) were issued by the Company to the members of the transferor company and was credited to the share capital account on the appointed date. The Company in its board meeting dated 15 November, 2011 allotted these shares. In view of the allotment of shares, the transferor Company ceased to be the holding company of the Company.

(iv) The employees of the demerged undertaking were transferred to the Company on their existing terms of employment with the transferor Company.

(v) All contingent liabilities relating to demerged undertaking were transferred to the company on the appointed date.

(vi) Deferred tax liability (net) pertaining to the demerged undertaking and as agreed by the Board of Directors were transferred to the Company.

The transferor company was carrying on business of demerged undertaking in trust on behalf of the Company for the period from the appointed date till the effective date.

2.2 EMPLOYEE BENEFIT PLANS

(i) Defined contribution plans

The Company makes Provident Fund and Employees'' State Insurance contributions which are defined contribution plans for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs. 137.11 Lacs (31 March, 2013: Rs. 107.65 Lacs) for Provident Fund and Employees'' State Insurance contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

(ii) Defined benefit plans

The Company offers employee benefit schemes of Gratuity to its employees. Benefits payable to all employees of the Company with respect to gratuity, a defined benefit plan is accounted for on the basis of an actuarial valuation as at the balance sheet date.

The following table sets out the funded status of defined benefit schemes and the amount recognised in the financial statements:

The estimates of future salary increases, considered in actuarial valuation, take into account of inflation, seniority, promotion and other relevant factors.

The expected rate of return on plan assets is determined after considering several applicable factors, such as the composition of the plan assets, investment strategy, market scenario, etc.In order to protect the capital and optimise returns within acceptable risk parameters, the plan assets are well diversified. The gratuity fund plan assets of the Company are managed by Orient Refractories Employees Group Trust through Kotak Mahindra Old Mutual Life Insurance Ltd. The trust has been recognised by the Income Tax authorities during the current year. The categories of plan assets as a percentage of total plan assets are based on information provided by Kotak Mahindra Old Mutual Life Insurance Ltd.

The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet date for the estimated term of the obligations.

2.3 SEGMENT INFORMATION

Business Segments:

The Company is engaged in the business of manufacturing and selling of refractories and monolithics. The entire operations are governed by the same set of risk and returns and, hence, the same has been considered as representing a single primary segment.

Since the Company''s business activity falls within a single business segment, there are no additional disclosures to be provided under Accounting Standard-17 ''Segment Reporting'' other than those already provided in the financial statements.

Geographical Segments:

The analysis of geographical segment is based on the geographical location of the customers. The Company operates primarily in India and has presence in international markets as well. Its business is accordingly aligned geographically, catering to two markets i.e. India and Outside India. For customers located outside India, the Company has assessed that they carry same risk and rewards. The Company has considered domestic and exports markets as geographical segments and accordingly disclosed these as separate segments. The geographical segments considered for disclosure are as follows:

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India.

All other assets (other than trade receivables) used in the Company''s business are located in India and are used to cater to both the categories of customers (within India and outside India), accordingly the total cost incurred during the period to acquire tangible and intangible fixed assets has not been disclosed.

2.4 RELATED PARTY TRANSACTIONS:

a. Ultimate holding company

RHI AG, Austria(w.e.f. 26 April, 2013)

b. Holding company

Dutch US Holding B.V., Netherlands (w.e.f. 26 April, 2013)

c. Fellow subsidiaries

RHI Clasil Limited(w.e.f. 26 April, 2013)

RHI India Private Limited (w.e.f. 26 April, 2013)

RHI Refractories Asia Ltd, Hong Kong (w.e.f. 26 April, 2013)

RHI Urmitz AG & Co. KG, Germany (w.e.f. 26 April, 2013)

d. Individuals/ entities having significant influence over the Company through their voting rights of 20% or more

Mr. S. G Rajgarhia, Managing Director (till 3 March, 2013) Dutch US Holding B.V. (from 4 March, 2013 till 25 April, 2013)

e. Key Managerial Personnel (KMP)

Mr. S.C. Sarin

Mr. Parmod Sagar, Managing Director (w.e.f.4 March, 2013)

Mr. S.G. Rajgarhia, Executive Director (w.e.f.4 March, 2013. Managing Director till 3 March, 2013)

f. Relatives of KMP

Mr. R. K. Rajgarhia, Director''s (Mr. S. G. Rajgarhia) brother

g. Entities in which KMP/ Relatives of KMP can exercise significant influence

Orient Abrasives Limited

APM Industries Limited

Hindustan General Industries Limited

Perfectpac Limited

2.5 DETAILS OF LEASING ARRANGEMENTS

The Company has entered into operating lease arrangements for certain facilities and office premises. These are cancellable by giving notice and are renewable by mutual consent on mutually agreed terms. There is no lock in period.

2.6 EXCEPTIONAL ITEMS

a. During the previous year, the Company had announced a voluntary retirement scheme (VRS) on 20 June, 2012. The scheme was open till 30 June, 2012. In response to the VRS, 43 employees had opted for the same. Expenditure of Rs. 125.86 Lacs on VRS had been charged to the Statement of Profit and Loss.

b. A fire has occurred at the warehouse in the Company''s factory at Bhiwadi on 25 September, 2011. As a result, the Company had estimated a loss of Rs. 149.76 Lacs (including raw materials, packing materials, repairs and maintenance and other expenses). The Company had filed a claim with the insurance company for the equivalent amount and recognised the same as the management was confident that the claim receivable would not be lower than the above amount. During the previous year, the insurance claim filed by the company in respect of the fire claim was settled for a lesser amount and accordingly a net loss of Rs. 55.73 Lacs had been accounted for during the previous year.

2.7 Previous year figures have been audited by another firm of chartered accountants.

3 PREVIOUS YEAR FIGURES

Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

Mar 31, 2013

1. CORPORATE INFORMATION

Orient Refractories Limited (Âthe Company''), incorporated on November 26, 2010 is engaged in manufacturing, production and distribution of Refractories, Monolithics and Ceramic Paper and have manufacturing facilities in Bhiwadi (Rajasthan).

2. BASIS OF PREPARATION

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

3. SEGMENT INFORMATION

BUSINESS SEGMENTS

The Company is engaged in the business of manufacturing and selling of refractories and monolithics. The entire operations are governed by the same set of risk and returns and, hence, the same has been considered as representing a single primary segment.

Since the company''s business activity falls within a single business segment, there are no additional disclosures to be provided under Accounting Standard-17 ÂSegment Reporting'' other than those already provided in the financial statements.

GEOGRAPHICAL SEGMENTS

The analysis of geographical segment is based on the geographical location of the customers. The Company operates primarily in India and has presence in international markets as well. Its business is accordingly aligned geographically, catering to two markets i.e.India and Outside India. For customers located outside India, the Company has assessed that they carry same risk and rewards. The Company has considered domestic and exports markets as geographical segments and accordingly disclosed these as separate segments. The geographical segments considered for disclosure are as follows

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India.

4. Pursuant to the scheme of arrangement between Orient Abrasives Limited (transferor company) (OAL) and the Company, the refractory business of the transferor company carried at its manufacturing unit at Bhiwadi (demerged undertaking), was transferred to the Company with effect from April 01, 2011 (the appointed date). The said scheme under Section 391 to 394 of the Companies Act, 1956 has been approved by the Hon''ble High Court of Delhi vide its order dated September 19, 2011 and has been effective from October 31, 2011 ("the effective date"), i.e. date of filing the above order with the Registrar of Companies.

The said scheme provides, inter alia, the transfer of demerged undertaking on a going concern basis to the Company in consideration of which, each shareholder of Orient Abrasives Limited whose name appeared in the register of members of Orient Abrasives Limited on the record date i.e. November 14, 2011, received one fully paid equity share of face value of Rs. 1.00 each in the Company.

The scheme provided for its basis of transfer of certain specific assets and liabilities and where not specifically provided in the scheme, it authorized the ÂBoard of Directors'' of both the companies to mutually decide through a resolution. In terms of above, following was done in previous year.

5. EXCEPTIONAL ITEMS

A. During the year, the Company announced a voluntary retirement scheme (VRS) on June 20, 2012. The scheme was open till June 30, 2012. In response to the VRS, 43 employees opted for the same. Expenditure of Rs. 125.86 Lacs on VRS has been charged to statement of profit and loss.

B. During the previous year, a fire occurred at the warehouse in the Company''s factory at Bhiwadi on September 25, 2011. As a result, the Company estimated the loss of Rs. 149.76 Lacs (including raw material, packing material, repair and maintenance and other expenses). The Company filed a claim with the insurance company for the equivalent amount and recognized the same as the management was confident that claim receivable shall not be lower than the above amount. During the year the insurance claim filed by the Company in respect of fire claim in the previous year was settled for a lesser amount and accordingly net loss of Rs. 55.73 Lacs has been accounted for in current year.

6. GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS

The Company has a defined benefit gratuity plan. Gratuity is computed as 15 days salary, for every completed year of service or part thereof in excess of 6 months. The benefit vests on the employees after completion of 5 years of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The following table summarise the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for gratuity.

7. LEASES

Operating Lease: Company as Lessee

The Company has taken various residential, office and warehouse premises under operating lease agreements. These are cancellable by giving notice and are renewable by mutual consent on mutually agreed terms. There is no lock in period. The lease payment recognized in the statement of profit and loss for the year is Rs. 26.51 Lacs (previous year: Rs. 26.91 Lacs).

8. RELATED PARTY DISCLOSURES

NAMES OF RELATED PARTIES AND RELATED PARTY RELATIONSHIP

I. PARTIES WHERE CONTROL EXISTS

A. HOLDING COMPANY

Orient Abrasives Limited (till November 15, 2011)

II. RELATED PARTIES WITH WHOM TRANSACTIONS HAVE TAKEN PLACE DURING THE YEAR

A. Individuals having significant influence over the Company through their voting rights of 20% or more

Mr. S G Rajgarhia, Managing Director (till March 3, 2013)

B. Associates

Dutch US Holding BV (Holds more than 20% shares)

C. Key Managerial Personnel

Mr. S C Sarin, Executive Director (w.e.f. October 18, 2011) Mr. Parmod Sagar, Managing Director (w.e.f March 4, 2013) Mr. S G Rajgarhia, Executive Director (w.e.f March 4, 2013)

D. Relatives of the persons having significant Influence over the Company (as covered in A above)

1. Mr R K Rajgarhia, Director Brother

E. The enterprises controlled, owned or significantly influenced by individuals having significant influence over the Company or their relatives (as covered in A and C above)

1. Orient Abrasives Limited

2. APM Industries Limited

3. Hindustan General Industries Limited

4. Perfectpac Limited

9. CAPITAL AND OTHER COMMITMENTS

At March 31, 2013, the Company has Rs. 21.84 Lacs (previous year: Rs. 36.53 Lacs) as amount of contracts remaining to be executed on capital account (net of advances).

10. PREVIOUS YEAR FIGURES

Previous year figures have been regrouped/reclassified, where necessary, to confirm to this year''s classification.

Mar 31, 2012

1. CORPORATE INFORMATION

Orient Refractories Limited (The Company'), incorporated on November 26, 2010 is engaged in manufacturing, production and distribution of Refractories, Monolithics and Ceramic Paper and have manufacturing facilities in Bhiwadi (Rajasthan), (also refer note 25).

2. BASIS OF PREPARATION

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

a Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 1.00 per share. The holder of each fully paid equity share is entitled to one vote. The company declares and pays dividends in Indian rupees. The dividend proposed by the board of directors is subject to the approval of the shareholders in the ensuing annual general meeting.

During the year ended March 31, 2012, the amount of per share dividend recognized as distributions to equity shareholders is Rs. 1.00 (Previous period: Rs. Nil)

*The cash credit loan is taken from bank are secured by first pari pasu charge on the current assets of the Company and second pari passu charge on movable fixed assets of the Company both present and future. Mr. S. G. Rajgarhia has also given personal guarantee for this facility to the bank. These are payable on demand and carries interest rate of bank base rate plus 305 basis points (currently 13.05% p.a.).

3. SEGMENT INFORMATION BUSINESS SEGMENTS

Since the Company's business activity falls within a single business segment, there are no additional disclosures to be provided under Accounting Standard-17 'Segment Reporting' other than those already provided in the Financial Statements.

GEOGRAPHICAL SEGMENTS

The analysis of geographical segment is based on the geographical location of the customers. The Company operates primarily in India and has presence in international markets as well. Its business is accordingly aligned geographically, catering to two markets i.e. India and Outside India. For customers located outside India, the Company has assessed that they carry same risk and rewards. The Company has considered domestic and exports markets as geographical segments and accordingly disclosed these as separate segments. The geographical segments considered for disclosure are as follows:

- Sales within India include sales to customers located within India.

- Sales outside India include sales to customers located outside India.

SECONDARY SEGMENT REPORTING (BY GEOGRAPHICAL SEGMENTS)

The following is the distribution of the Company's consolidated revenue of operations by geographical market, regardless of where the goods were produced (Amount in Rs. Lacs)

For the year ended March 31, 2012

India 25,429.45

Outside India 4,612.16

Total 30,041.61

The following table shows the carrying amount of trade receivable by geographical segments

As at March 31, 2012

India 4,698.38

Outside India 1,185.90

Total 5,884.28

All other assets (other than trade receivables) used in the Company's business are located in India and are used to cater both the customers (within India and outside India), accordingly the total cost incurred during the period to acquire tangible and intangible fixed assets has not been disclosed.

4. Pursuant to the scheme of arrangement between Orient Abrasives Limited (transferor company) and the Company, the Refractory business of the transferor company carried at its manufacturing unit at Bhiwadi (demerged undertaking), was transferred to the Company with effect from April 01, 2011 (the Appointed Date). The said scheme under Section 391 to 394 of the Companies Act, 1956 has been approved by the Hon'ble High Court of Delhi vide its order dated September 19, 2011 and has been effective from October 31, 2011 ("the effective date"), i.e. date of filing the above order with the Registrar of Companies.

The said scheme provides, inter alia, the transfer of demerged undertaking on a going concern basis to the Company in consideration of which, each shareholder of Orient Abrasives Limited whose name appeared in the register of members of Orient Abrasives Limited on the record date i.e. November 14, 2011, received one fully paid equity share of face value of Rs. 1.00 each in the Company.

The scheme provides for its basis of transfer of certain specific assets and liabilities and where not specifically provided in the scheme, has authorized the 'Board of Directors' of both the companies to mutually decide through a resolution. In terms of above, following have been done

(i) The book value of assets, liabilities, reserves and surplus (as agreed) of the demerged undertaking as on the Appointed Date has been accounted for as assets and liabilities and reserves in the books of the Company as on the Appointed Date. Following is the amount of such assets, liabilities and reserves:

(ii) Loans as identified for the demerged undertaking and transferred from OAL have been recorded in the books. Later on, the company has obtained its own credit facility and loans transferred from the transferor company have been repaid.

(iii) Aggregate face value of the new equity shares (1,196.39 lacs shares of Rs. 1.00 each amounting to Rs. 1,196.39 lacs) to be issued by the Company to the members of the transferor Company was credited to the share capital account on the Appointed Date. The Company in its board meeting dated November 15, 2011 had allotted these shares. In view of the allotment of shares, the transferor company is no longer the holding company of the Company.

(iv) The employees of the demerged undertaking have been transferred to the Company on their existing terms of employment with the transferor company.

(v) All contingent liabilities relating to demerged undertaking have been transferred to the Company on the Appointed Date.

(vi) Deferred Tax Liability (Net) pertaining to the demerged undertaking and as agreed by the Board of directors has been transferred to the Company.

The transferor company was carrying on business of demerged undertaking in trust on behalf of the Company for the period from the Appointed Date till the Effective Date.

5. During the year, a fire occurred at the warehouse in the Company's factory at Bhiwadi on September 25, 2011. As a result, the Company has estimated a loss of Rs. 149.76 lacs (including raw material, packing material, repair and maintenance and other expenses). The Company has filed a claim with the insurance company for the equivalent amount and recognized the claim. The surveyor appointed by the insurance company has already completed the inspection. In view of the same, the management is confident that claim receivable shall not be lower than the above amount. Expenses incurred in this regard have also been provided for.

6. GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS

The Company has a defined benefit gratuity plan. Gratuity is computed as 15 days salary, for every completed year of service or part thereof in excess of 6 months and is payable on retirement/termination/resignation. The benefit vests on the employees after completion of 5 years of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy. At the end of accounting period actuarial valuation is done as per the projected unit credit method and any shortfall in the funding claims is further provided for.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

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

The Company has taken various residential, office and warehouse premises under operating lease agreements. These are cancellable by giving notice and are renewable by mutual consent on mutually agreed terms. The lease payment recognized in the statement of profit and loss account for the year is Rs. 26.91 Lacs (previous period: Rs. Nil).

8. RELATED PARTY DISCLOSURES

Names of related parties and related party relationship

A. Parties where control exists

Orient Abrasives Limited (upto November 15, 2011), (also refer note 25)

B. Individuals having significant influence over the company through their voting rights of 20% or more

Mr. S.G. Rajgarhia, Managing Director

C. Key Managerial Personnel

Mr. S.C. Sarin (w.e.f. October 18,2011)

D. Relatives of the persons having significant Influence over the Company (as covered in B above)

1. Mrs. Usha Rajgarhia Wife

2. Mr. R.K. Rajgarhia Brother

3. Ms. Bhawna Rajgarhia Daughter

E. The Enterprises controlled, owned or significantly influenced by individuals having significant influence over the Company or their relatives (as covered in B and C above)

1. Orient Abrasives Limited (from November 15, 2011), (also refer note 25)

2. APM Industries Limited -

3. Hindustan General Industries Ltd.

4. Madhushree Properties Pvt. Ltd.

5. Perfectpac Ltd. '

9. CAPITAL AND OTHER COMMITMENTS

a. At March 31, 2012, the company has Rs. 36.53 Lacs (Previous period: - nil) as amount of contracts remaining to be executed on capital account (Net of advances).

b. For Commitments relating to lease arrangements, please refer note no 28.

Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article