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Notes to Accounts of Shree Pushkar Chemicals & Fertilisers Ltd.

Mar 31, 2023

(i) The fair value of quoted mutual fund units are based on quoted net asset value at the reporting date.

(ii) The strategic investments in subsidiaries have been taken at cost.

(iii) The market price of a bond is determined using the current interest rate compared to the interest rate stated on the bond.

(iv) Terms of conversion : 1,22,999 Compulsorily Convertible Debenture will be converted into 36,95,883 equity shares of the company, Kisan Phosphates Private Limited after a period of 5 years. After conversion into equity shares it shall rank pari passu with the existing equity shares of the company, Kisan Phosphates Private Limited.

(v) Investment at fair value through profit and loss reflect investment in quoted and unquoted equity securities, bonds and quoted mutual fund units.

(a) Terms / rights attached to:

Equity Shares

The Company has one class of equity shares having a par value of Rs. 10 per share. Each shareholder is eligible for one vote per share held. 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, the equity share holders are eligible to receive the remaining assets of the company after distribution of all preferential amounts in proportion to their share holding.

Amount standing in the Capital Reserve account pertains to the money received by the Company against share warrants amounting to Rs. 29.77 lakhs that was transferred to Capital Reserve during the financial year 2012-13 and 2019-20 due to non-allotment of equity shares.

The amount standing in the Securities Premium account pertains to the premium received on issue of shares during the previous years. In the current year the amount of Rs. 1421.05 lakhs was credited to securities premium account against issuance of 7,89,473 shares at a premium of Rs.180.00 each.

1) Working capital loans from State Bank of India Rs. Nil (March 31,2022: Rs. 578.08 lakhs) carries interest rate @ 7.70%

(March 31,2022: 7.00% p.a.) and are secured as under:

a) Primary Security:

i) Hypothecation on the entire current assets of the company both present and future on pari-passu 1st charge with Axis Bank, Kotak Mahindra Bank and DBS Bank.

b) Collateral Security:

i) First pari-passu charge (with Axis Bank, Kotak Mahindra Bank and DBS Bank) on Land & Building located at B-102, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

ii) First pari-passu charge (with Axis Bank, Kotak Mahindra Bank and DBS Bank)on Land & Building located at B-103, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iii) First pari-passu charge (with Axis Bank, Kotak Mahindra Bank and DBS Bank) on Land & Building located at D-25, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iv) First pari-passu charge (with Axis Bank, Kotak Mahindra Bank and DBS Bank) on Land & Building located at B-97, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

v) First pari-passu charge (with Axis Bank, Kotak Mahindra Bank and DBS Bank) on Land & Building located at D-18, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

vi) Hypothecation charges on pari-passu basis over Plant & Machinery and entire fixed assets located at B-102/103, D-25, B-97 & D-18, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

c) Personal Guarantee of Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the

company.

2) Working capital loans from Axis Bank Ltd. Rs. 554.01 lakhs (March 31,2022: Rs. 1158.33 lakhs) carries interest rate @

9.20% p.a. (March 31, 2022: 7.00% p.a.) and are secured as under:

a) Primary Security:

i) First Pari-passu charge on the entire current assets of the company.

b) Collateral Security:

i) First Pari-passu charge on Land & Building located at B-97, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

ii) Second Pari-passu charge on Land & Building located at B-102/103, D-25, D-18, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iii) Second Pari-passu charge on Plant & Machinery located at B-102/103, D-25, D-18, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

c) Personal Guarantee of Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the

company.

3) Working capital loans from Kotak Mahindra Rs. Nil (March 31, 2022: Rs. Nil) carries interest rate @ 8.40% p.a. (March

31, 2022: 7.20% p.a.) and are secured as under:

a) Primary Security:

i) Hypothecation on the entire current assets of the company both present and future on pari-passu 1st charge with SBI Bank, Axis Bank, and DBS Bank.

b) Collateral Security:

i) First pari-passu charge (with SBI Bank, Axis Bank, and DBS Bank) on Land & Building located at B-102, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

ii) First pari-passu charge (with SBI Bank, Axis Bank, and DBS Bank)on Land & Building located at B-103, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iii) First pari-passu charge (with SBI Bank, Axis Bank, and DBS Bank) on Land & Building located at D-25, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iv) First pari-passu charge (with SBI Bank, Axis Bank, and DBS Bank) on Land & Building located at B-97, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

v) First pari-passu charge (with SBI Bank, Axis Bank, and DBS Bank) on Land & Building located at D-18, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

vi) First pari-passu charge (with SBI Bank, Axis Bank, and DBS Bank) on Land & Building located at D-10, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

vii) Hypothecation charges on pari-passu basis over Plant & Machinery and entire fixed assets located at B-102/103, D-25, B-97 , D-18 & D-10, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

c) Personal Guarantee of Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the

company.

4) Working capital loans from DBS Bank Rs. Nil (March 31, 2022: Rs. Nil) carries interest rate @ 8.55% p.a.(March 31,

2022: 7.20% p.a.) and are secured as under:

a) Primary Security:

i) Hypothecation on the entire current assets of the company both present and future on pari-passu 1st charge with SBI Bank, Axis Bank, and Kotak Mahindra Bank.

b) Collateral Security:

i) Equitable mortgage by way of first pari-passu (with SBI Bank, Axis Bank and Kotak Mahindra Bank) on Land & Building located at B-102, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

ii) Equitable mortgage by way of first pari-passu charge (with SBI Bank, Axis Bank and Kotak Mahindra Bank) on Land & Building located at B-103, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iii) Equitable mortgage by way of first pari-passu charge (with SBI Bank, Axis Bank and Kotak Mahindra Bank) on Land & Building located at D-25, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iv) Equitable mortgage by way of first pari-passu charge (with SBI Bank, Axis Bank and Kotak Mahindra Bank) on Land & Building located at B-97, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

v) Equitable mortgage by way of first pari-passu charge (with SBI Bank, Axis Bank and Kotak Mahindra Bank) on Land & Building located at D-18, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

vi) Hypothecation charges on first pari-passu basis over Plant & Machinery, Office Equipment''s, Furniture & Fixtures & all other fixed assets located at B-102/103, D-25, B-97 & D-18, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

c) Personal Guarantee of Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the company.

d) 10% of SBLC limits in form of Fixed deposits lien marked in favour of bank.

5) Details of the aggregate of each loan guaranteed by directors or others, each head-wise.

All the loans repayable on demand from banks amounting to Rs. 554.01 lakhs (March 31, 2022: Rs.1709.03 lakhs) guaranteed by Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the company.

6) Details of continuing default in the repayment of loans and interest, specifying the period and amount separately in each case.

There has been no default in the repayment of loans or interest thereon as on date.

Note: The above investments are quoted instruments in active markets and the same is recognised at fair value. Fair value measurement is done considering the Level -1 of Fair Value Hierarchy as per the Ind-AS 113.

Note 42 : Financial Risk Management Objectives and Policies

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

The Company is exposed to market risk, credit risk and liquidity risk. The below note explains the sources of risk which the entity is exposed to and how the entity manages the risk :

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including Fixed deposits with banks and financial institutions and other financial instruments.

Trade receivables

Customer credit risk is managed by the Company''s established policy, procedures and control relating to customer credit risk management. The Company is in the business of manufacturing and trading of Chemical, Fertilisers and Dyes intermediate. Credit quality of a customer is assessed by the management on regular basis with market information and individual credit limits are defined accordingly. Outstanding customer receivables are regularly monitored and any further services to major customers are approved by the senior management.

An impairment analysis is performed at each reporting date on an individual basis for major customers. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 9.

On account of adoption of Ind-AS 109, the Company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix to compute the expected credit loss allowance for trade receivables. The provision matrix takes into account available external and internal credit risk factors and the Company''s historical experience for customers.

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company''s finance department in accordance with the Company''s policy. Investments of surplus funds are made generally in the fixed deposits and for funding to subsidiary company. The investment limits are set to minimise the concentration of risks and therefore mitigate financial loss to make payments for vendors.

Liquidity Risk

The Company monitors its risk of a shortage of funds using a liquidity planning tool.

The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank loans and unsecured loans. The Company has access to a sufficient variety of sources of funding which can be rolled over with existing lenders. The Company believes that the working capital is sufficient to meet its current requirements.

Market risk comprises two types of risk: interest rate risk and currency risk. Financial instruments affected by market risk include loans and borrowings and deposits

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

The Company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings. The Company''s policy is to keep balance between its borrowings at fixed rates of interest. The difference between fixed and variable rate interest amounts calculated by reference to an agreed-upon notional principal amount.

Interest rate sensitivity

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

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to its operating activities. The Company manages its foreign currency risk by hedging the payables when considered necessary. When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. The Company hedges its exposure to fluctuations on the translation into INR of its foreign payables in foreign currencies and by using foreign currency option or forward contracts.

Foreign Currency Sensitivity

The following tables demonstrate the sensitivity to a reasonably possible change in foreign exchange rate, with all other variables held constant. The impact on the Company''s profit before tax is due to changes in the fair value of monetary assets and liabilities.

Equity price risk

The Company''s unlisted equity securities are of subsidiary and deemed cost of the same are taken as previous GAAP carrying value (i.e. cost of acquisition). The value of the financial instruments is not material and accordingly any change in the value of these investments will not affect materially the profit or loss of the Company.

Note 43 : Capital Management

For the purpose of the Company''s capital management, capital includes issued equity share capital, securities premium and all other reserves attributable to the equity holders of the Company. The primary objective of the Company''s capital management is to maximise the value of the share and to reduce the cost of capital.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company can adjust the dividend payment to shareholders, issue new shares, etc. The Company monitors capital using a gearing ratio, which is net debt divided by total equity. The Company includes within net debt, interest bearing loans and borrowings, less cash and cash equivalents.

Cases pending before appellate authorities in respect of which the Company has filed appeals.

* On the basis of current status of individual case for respective years and as per legal advice obtained by the Company, wherever applicable, the Company is confident of winning the above cases and is of the view that no provision is required in respect of above cases.

(b) Bank guarantee given by the banks on behalf of the Company amounting to Rs. 746.85 lakhs (March 31, 2022: Rs. 547.75 lakhs) to suppliers of goods and services, the Electricity Board and Customs Authority.

Note:

1. The Company has issued Corporate Guarantees aggregating to Rs. Nil as at year end (March 31,2022: Rs. 511 lakhs) on behalf of Mrs. Bhanu Makharia, a relative of director. Liabilities outstanding for which Corporate Guarantees have been issued aggregate to Rs. Nil as on March 31,2023 (March 31, 2022: Rs. 16.32 lakhs).

2. The Company has issued Corporate Guarantees aggregating to Rs. 4,900.00 lakhs as at year end (March 31, 2022: Rs. 5,500.00 lakhs) on behalf of Subsidiary M/s Kisan Phosphates Private Limited. Liabilities outstanding for which Corporate Guarantees have been issued aggregate to Rs. 4,900.00 lakhs as on March 31, 2023 (March 31, 2022: Rs. 4,700.00 lakhs).

3. The Company has issued Corporate Guarantees aggregating to Rs. 4,925.00 lakhs as at year end (March 31, 2022: Rs. 7,275.00 lakhs) on behalf of Subsidiary M/s Madhya Bharat Phosphate Private Limited. Liabilities outstanding for which Corporate Guarantees have been issued aggregate to Rs. 4,925.00 lakhs as on March 31,2023 (March 31, 2022: Rs. 7,275.00 lakhs).

Note 46 : Segment Information

Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker, in deciding how to allocate resources and assessing performance. Considering the nature of business and integrated manufacturing process of the Company, the Company considers its products under one segment only i.e. Chemicals & Fertilisers. Accordingly, Segment Reporting in accordance with Indian Accounting Standard - 108 âOperating Segmentâ issued by the Institute of Chartered Accountants of India and adopted by Companies (Accounting Standard) Rules, 2015 is not applicable to the Company.

III. Sensitivity Analysis

The below 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 liability recognised in the balance sheet. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.

Note 49 : Expenditure on Corporate Social Responsibility

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects. A CSR committee has been formed by the Company as per the Act. The Company is spending amount for these activities, which are specified in Schedule VII of the Companies Act, 2013.

Note 53 : Statutory Information

a. There are no proceedings initiated or are pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

b. The Company has not entered into any transactions with struck off companies during the year.

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

period.

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

e. The Company does not have any such transaction which is not recorded in the books of accounts that has been

surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

f. The Company has not advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) to or in any other person or entity, including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Further, the Company has not received any funds from any person or entity, including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

g. The Company has complied with the number of layers prescribed under clause (87) of the Section of the Companies Act read with the Companies (Restrictions on Number of Layers) Rule, 2017.

h. The Company is not declared wilful defaulter by bank or financial institutions or any lender during the financial year.

i. Quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts.

j. The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was obtained.

Note 55 : Previous Years'' Figures

The Company has re-grouped, re-classified and/or re-arranged figures for previous year, wherever required to confirm with current year''s classification.

The notes referred to above are an integral part of these financial statements.

Mar 31, 2018

Note 1: Company Overview

Shree Pushkar Chemicals & Fertilisers Limited (the âCompanyâ) is a Public Limited Company domiciled in India and incorporated on March 29, 1993 under the provisions of Companies Act, 1956. The Company is engaged in the business of manufacturing and trading of Chemicals, Dyes and Dyes Intermediate, Cattle Feeds, Fertilisers and Soil Conditioner. The equity shares of the Company were listed on The National Stock Exchange of India Limited and BSE Limited

Note 2 : First Time Adoption of Ind-AS

For all periods up to March 31, 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP) Indian GAAP (âIGAAPâ). These standalone financial statements of Shree Pushkar Chemicals and Fertilizers Limited for the year ended March 31, 2018 have been prepared in accordance with Ind-AS. This is the first set of Financial Statements in accordance with Ind-AS. For the purpose of transition from the IGAAP to Ind-AS, the Company has followed guidance provided in Ind-AS 101 - First Time Adoption of Indian Accounting Standards, w.e.f. April 01, 2016 as the transition date.

The transition to Ind-AS has resulted in changes in the presentation of the financial statements, disclosures in the notes, accounting policies and principles. The accounting policies set out in Note 2 have been applied in preparing the standalone financial statements for the year ended on March 31, 2018 as well as for March 31, 2017 for comparative information. In preparing these financial statements, opening balance sheet was prepared as at 1 April 2016. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at 1 April 2016 and the financial statements as at and for the year ended March 31, 2017.

Exemptions on first time adoption of Ind-AS availed in accordance with Ind-AS 101, have been described below: Exemptions availed on first time adoption of Ind AS 101

Ind-AS 101 allows certain optional exemptions and mandatory exemptions on first time adoption of Ind-AS from the retrospective application of certain provisions of Ind-AS. The Company has accordingly applied the following exemptions: Ind AS optional exemptions:

(i) Property, Plant and Equipment and Intangible Assets

Ind-AS 101 permits, a first time adopter to elect to continue with the carrying values 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 and Investment properties covered by Ind-AS 40 Investment Properties.

Accordingly, the Company has elected to measure all of its property, plant and equipment, Investment properties and intangible assets at their previous GAAP carrying value.

(ii) Measurement of Investment in subsidiaries, associates and joint ventures

Ind-AS allows entity that subsequently measures an investment in a subsidiary, joint ventures or associate at cost, may measure such investment at cost (determined in accordance with Ind-AS 27) or deemed cost (fair value or previous GAAP carrying amount) in its separate opening Ind-AS balance sheet.

For investments in equity instruments of subsidiary, the Company has elected to apply separate exemption available under Ind-AS 101 by measuring at their previous GAAP carrying amount, which is the deemed cost at the date of transition to Ind-AS.

Ind AS mandatory exceptions:

(i) Estimates

An entity''s estimates in accordance with Ind-AS at the date of transition to Ind-AS 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 April 1, 2016 are consistent with the estimates as at the same date made in conformity 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:

- Impairment of financial assets based on expected credit loss model.

(ii) Classification and measurement of financial assets

Ind-AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and

Note 3 : Reconciliations Between Previous GAAP and Ind-AS

The following reconciliations provides the effect of transition to Ind-AS from IGAAP in accordance with Ind-AS 101:

A. Equity as at beginning of April 1, 2016

B. Equity as at March 31, 2017

C. Net profit for the year ended March 31, 2017

D. Cash flows for the year ended March 31, 2017

Notes :

1. Other Non Current Financial Assets

Under Indian GAAP, deposits were recorded at absolute amount of deposit paid. Under Ind-AS, deposits are recorded at present value by discounting the amount of security deposit paid at an appropriate discounting rate. Accordingly effect of the same has been effected by reducing other non-current finacial assets by INR 8.45 lakhs and a corresponding increase in other current assets as prepaid expenses as at April 1, 2016.

2. Trade Receivables

Under Indian GAAP, the Company has created provision for impairment of trade receivables consists only in respect of specific amount for incurred losses. Under Ind-AS, impairment allowance has been determined based on Expected Credit Loss model (ECL). Accordingly, trade receivables have been reduced by INR 44.27 lakhs with a corresponding decrease in retained earnings of INR 29.22 lakhs and deferred tax liability of INR 15.05 lakhs as at April 1, 2016.

Notes :

1. Other Non Current Financial Assets

Under Indian GAAP, deposits were recorded at absolute amount of deposit paid. Under Ind-AS, deposits are recorded at present value by discounting the amount of security deposit paid at an appropriate discounting rate. Accordingly effect of the same has been effected by reducing other non-current finacial assets by INR 26.43 lakhs and a corresponding increase in other current assets as prepaid expenses as at March 31,2017

2. Trade Receivables

Under Indian GAAP, the Company has created provision for impairment of trade receivables consists only in respect of specific amount for incurred losses. Under Ind-AS, impairment allowance has been determined based on Expected Credit Loss model (ECL). Accordingly, trade receivables have been reduced by INR 98.20 lakhs with a corresponding decrease in retained earnings of INR 64.21 lakhs and deferred tax liability of INR 33.99 lakhs as at March 31, 2017.

3. Secured Loan

Under Indian GAAP, transaction costs incurred in connection with borrowings are charged to profit or loss/ capitalised as and when incurred. Under Ind-AS, transaction costs are included in the initial recognition amount of financial liability and charged to profit or loss/ capitalised using the effective interest method. Accordingly, borrowings have been decreased by INR 0.25 lakhs with a corresponding increase in retained earnings of INR 0.16 lakhs, decrease in deferred tax liability of INR 0.09 lakhs as at March 31, 2017.

Notes :

1. Excise Duty and Cash Discount

As per the requirements of Ind-AS 109 to measure revenue at the fair value of the consideration received or receivable cash discount of Rs.712.45 is netted off from revenue under the head "Gross Revenue from Operations" and corresponding decrease is made in other expenses during the financial year 2016-17.Also Excise duty of INR 3,556.10 lacs on account of sale of goods has been included in revenue as it is on own account because it is liability of the manufacturer which forms part of the production, irrespective of whether goods are sold or not.

2. Interest Income on Deposits

As per the requirements of Ind-AS 109, notional income of INR 5.45 Lakhs for interest on deposits for rent under the head "Other Income" is recognised during the financial year 2016-17.

3. Other comprehensive income (OCI)

Concept of other comprehensive income did not exist under Indian GAAP. Under Ind-AS, all items of income and expenses recognised in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income or expenses that are not recognised in profit or loss but are shown in the statement of profit and loss as ''Other comprehensive income'' includes remeasurement of defined employee benefits plans. The amount related to remeasurement of defined employee benefit plan of INR 11 lakhs and tax effect of INR 3.81 lakhs on the same is presented as part of OCI during the financial year 2016-17.

4. Finance Costs

Ind-AS 109 requires transaction costs incurred towards origination of borrowings to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognised in the profit or loss over the tenure of the borrowing as part of interest expense by applying the effective interest method.

5. Deferred Tax

Various Ind-AS transitional adjustments lead to temporary differences. According to the accounting policies, the Company has to account for such differences. Deferred tax adjustments are recognised in relation to the underlying transaction either in retained earnings or a separate component of equity. Effect of timing difference is considered for calculation of deferred tax for the financial year 2016-17.

1 Asset under construction

Capital Work In Progress as at March 31, 2018 comprises expenditure for capacity enhancement of Unit III and Unit IV situated at Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra,

2 Property, Plant and Equipments pledged/ mortgaged as security

All Property, Plant and Equipment are subject to a first charge/ collateral to secure the loans taken by the Company.

Note (i) The fair value of quoted mutual fund units are based on quoted net asset value at the reporting date.

(ii) The strategic investments in subsidiaries have been taken at cost.

(iii) Terms of conversion : 1,22,999 Compulsorily Convertible Debenture will be converted into 36,95,883 equity shares of the company, Kisan Phosphates Private Limited after a period of 5 years.After conversion into equity shares it shall rank pari passu with the existing equity shares of the company,Kisan Phosphates Private Limited.

(iv) Investment at fair value through profit and loss reflect investment in quoted and unquoted equity securities and quoted mutual fund units.

Trade Receivables are non interest bearing and terms are generally from 60 to 90 days.

Receivables outstanding for a period exceeding six months mainly includes Rs.796.94 lakhs (March 31, 2017 : Rs. 797.05 lakhs, April 1,2016: Rs. 0.11 lakhs) related to dues from Huntsman International (India) Private Limited and Rs. Nil (March 31, 2017 : Rs. 533.20 lakhs, April 1,2016 : Rs. 323.06 lakhs) related to dues from Shriram Fertilisers & Chemicals Limited (on account of subsidy receivable).

In case of Huntsman International (India) Private Limited, the Company has filed a summary suit in the Hon''ble Bombay High Court against it for recovery of its unpaid dues. The said suit is pending for trial in the said Court.

In matter of suit filed by Huntsman International (India) Private Limited against the Company, the Hon''ble High Court of Delhi has awarded the order in favour of the Company on February 21, 2018 wherein the suit has been dismissed / the plaint returned to plaintiff for filing in the Court of appropriate territorial jurisdiction. Accordingly, the Company''s management is very confident for recovery of these unpaid dues and an order in the Company''s favour.

In case of Shriram Fertilisers & Chemicals Limited, the subsidy is related to sale of Single Super phosphate (SSP) and as per the management''s view, the Company is receiving subsidy regularly and the balance amount has been recovered as on date. Therefore, the management has not considered these balances as doubtful.

(a) Terms / rights attached to:

Equity Shares

The Company has one class of equity shares having a par value of '' 10 per share. Each shareholder is eligible for one vote per share held. 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, the equity share holders are eligible to receive the remaining assets of the company after distribution of all preferential amounts in proportion to their share holding.

During the year ended March 31, 2018, the amount of per share dividend recognised as distributions to Equity Shareholders is Rs. 1.5/- per share of Rs.10/- each for the year ended March 31, 2017.

During the year ,the company has received share application money in cash from its directors against preferential issue of 1,89,062 equity shares for which the allotment is pending as on March 31, 2018.

Further, the company has received consideration other than cash i.e. in the form of 27.10 lakh equity shares of Kisan Phosphates Private Limited amounting to Rs. 902.43 lakhs for which the company has to allot 4,26,540 shares to the shareholder''s of Kisan Phosphates Private Limited

Notes:

1) Working capital loans from State Bank of India of Rs. 1,511.81 Lakhs (March 31, 2017: Rs. 1,414.38 Lakhs, April 1, 2016: Rs. 1,042.78 Lakhs) carrying interest rate of 9.20% (March 31, 2017: 10.60% p.a., April 1, 2016 :10.80% p.a) and are secured as under:

a) Primary Security:

i) Hypothecation of the entire current assets of the company on paripassu basis with IDBI Bank and Axis Bank .

b) Collateral Security:

i) Equitable mortgage by way of pari-passu (with IDBI Bank & Axis Bank) on Land & Building of the company located at :

- B-102 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company

- B-103 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

- D-25 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

- B-97 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

- D-18 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

ii) Hypothecation charges on pari-passu basis over plant & machinary,Office Equipments,Furniture & Fixtures & all other fixed assets located at

- B102/103, D25, B97 & D-18, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra.

c) Personal Guarantee of Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the company

2) Working capital loans from IDBI Bank Limited Rs. (31.94) Lakhs (March 31, 2017: Rs. 0.76 Lakhs,April 1, 2016: Rs. 690.67 Lakhs) carrying interest rate of 8.75% p.a.(March 31, 2017 :10.60% p.a. ; April 1, 2016 : 11.80% p.a) and are secured as under:

a) Primary Security:

i) Hypothecation of the entire current assets of the company on paripassu basis with State Bank Of India and Axis Bank .

b) Collateral Security:

i) Equitable mortgage by way of pari-passu (with State Bank Of India & Axis Bank) on Land & Building of the company located at :

- B-102 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company

- B-103 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

- D-25 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

- B-97 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

- D-18 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

ii) Hypothecation charges on pari-passu basis over plant & machinary,Office Equipments,Furniture & Fixtures & all other fixed assets located at :

- B102/103, D25, B97 & D-18, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra.

c) Personal Guarantee of Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the company

3) Working capital loans from Axis Bank Ltd. Rs. 497.66 Lakh (March 31, 2017: Rs. Nil Lakh, April 1, 2016: Rs. Nil lakh) carrying interest rate of 8.20% p.a.(March 31, 2017 :Nil ; March 31, 2016 : Nil) and are secured as under:

a) Primary Security:

i) First Pari-passu charge on the entire current assets of the company.

ii) First Pari-passu charge on Land & Building of the company located at B-97 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra.

iii) Second Pari-passu charge on Land & Building of the company located at B-102/103, D-25, D-18 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra.

iv) Second Pari-passu charge on Plant & Machinary located at B-102/103, D-25, D-18 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra.

b) Personal Guarantee of Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the company

4) Details of the aggregate of each loan guaranteed by directors or others, each head-wise.

All the loans repayable on demand from banks amounting to Rs.1977.52 Lakhs (March 31,2017: Rs.390.44 Lakhs ; April 1,2016 : 737.08 Lakhs) guaranteed by Mr. Punit Makharia and Gautam Makharia, Chairman and Joint Managing Director of the company

5) Details of continuing default in the repayment of loans and interest, specifying the period and amount separately in each case.

There has been no default in the repayment of loans or interest thereon as on date.

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

The Company is exposed to market risk, credit risk and liquidity risk. The below note explains the sources of risk which the entity is exposed to and how the entity manages the risk :

Credit Risk

Trade receivables

Customer credit risk is managed by the Company''s established policy, procedures and control relating to customer credit risk management. The Company is in the business of manufacturing and trading of Chemical,Fertilisers and Dyes intermediate. Credit quality of a customer is assessed by the management on regular basis with market information and individual credit limits are defined accordingly. Outstanding customer receivables are regularly monitored and any further services to major customers are approved by the senior management.

Financial instruments and cash deposits

The Company''s maximum exposure to credit risk for the components of the balance sheet at March 31, 2018 and March 31, 2017 is the carrying amounts as stated in balance sheet except for balances of subsidiary company.

Liquidity Risk

The Company monitors its risk of a shortage of funds using a liquidity planning tool.

Market Risk

Market risk comprises two types of risk: interest rate risk and currency risk. Financial instruments affected by market risk include loans and borrowings and deposits Interest rate risk

The Company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings. The Company''s policy is to keep balance between its borrowings at fixed rates of interest.The difference between fixed and variable rate interest amounts calculated by reference to an agreed-upon notional principal amount.

The exposure of the Company to interest rate changes at the end of the reporting period are as under:

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates to purchase of raw material of chemical and fertiliser products from out of the India. The Company manages its foreign currency risk by hedging the payables as an when considered necessary. When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. The Company hedges its exposure to fluctuations on the translation into INR of its foreign payables in foreign currencies and by using foreign currency option or forward contracts.

Foreign Currency Sensitivity

Equity price risk

Note 4 : Capital Management

(b) Bank guarantee given by the banks on behalf of the Company amounting to Rs.328.19 Lakhs (March 31, 2017: 242.87 Lakhs, April 01, 2016: 378.71 Lakhs) to suppliers of goods and services, the Electricity Board and Customs Authority.

(c) A customer, Huntsman International (India) Private Limited, of the Company had filed Civil suit with the Hon''ble High Court of Delhi at New Delhi for Injunction and Damages for Rs. 300.00 lakhs against Abiss Textile Solutions Private Limited (a company promoted by two promoters of the Company), the Company and its promoters for allegedly using confidential and proprietary information of the customer for manufacturing, marketing and selling Dye products and for other consequential relief. The Hon''ble High Court of Delhi had granted an ex-parte interim injunction in this matter till the next date of hearing to Huntsman International (India) Private Limited vide its order dated May 24, 2016.

On the other hand, the Company has also filed Summary Suit with Hon''ble Bombay High Court on July 20, 2016 for recovery of unpaid dues against Huntsman International (India) Private Limited, Damage and Defamation suit with Hon''ble Bombay High Court on September 8, 2016 for claim of Rs. 25,000 lakhs for malafide intention behind damaging and defaming image of the Company against Huntsman International (India) Private Limited and also filed Criminal Cheating case against Huntsman International (India) Private Limited and its directors and officers.

The Company''s management was of the view that the claim of Huntsman International (India) Private Limited is not justifiable and will not sustain as the Company and Huntsman International (India) Private Limited are Mumbai-based parties and they will not be covered under the jurisdiction of Delhi High Court. The same view has been enumerated in the judgement order passed by the Hon''ble High Court of Delhi vide its order dated February 21, 2018. The suit filed by Huntsman International (India) Private Limited has been dismissed / the plaint returned to plaintiff for filing in the Court of appropriate territorial jurisdiction. With the dismissal of this suit, the ex-parte interim order for injunction in this matter stands vacated and thus there is no case against the company by Huntsman lnternational (lndia) Private Limited. Therefore, there are no contingent liabilities as on date in this respect which needs to be reported.

Note:

1. The Company has issued Corporate Guarantees aggregating to Rs. 511 Lakhs as at year end (March 31, 2017: Rs. 511 Lakhs, April 01, 2016: Rs. 511 Lakhs) on behalf of Mrs. Bhanu Makharia, a relative of director. Liabilities outstanding for which Corporate Guarantees have been issued aggregates Rs. 136.89 Lakhs as on March 31, 2018 (March 31, 2017: Rs. 155.42 Lakhs, April 01, 2016: Rs. 181.73 Lakhs).

2 The Company has issued Corporate Guarantees aggregating to Rs. 3,100.00 Lakhs as at year end (March 31, 2017: Rs. Nil Lakhs, April 01, 2016: Rs. Nil Lakhs) on behalf of Subsidiary M/s Kisan Phosphates Private Limited.

Note 5 : Segment Information:

Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker, in deciding how to allocate resources and assessing performance. The Group''s chief operating decision maker is the Chief Executive Officer and Managing Director. Considering the nature of business and integrated manufacturing process of the Company, the Company considers its products under one segment only i.e. Chemicals & Fertilisers. Accordingly, Segment Reporting in accordance with Ind Accounting Standard - 108 "Operating Segment" issued by the Institute of Chartered Accountants of India and adopted by Companies (Accounting Standard) Rules, 2015 is not applicable to the Company.

IV. Sensitivity Analysis

V. Risk Exposure

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

Interest risk

A decrease in the market yields in the government bond will increase the plan liability.

Longevity risk

The present value of defined benefit plan liability is calculated using a discount rate which is determined by reference to the best estimate of the mortality of plan participants both during and after employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

Salary risk

The present value of defined benefit plan liability is calculated using a discount rate which is determined by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan''s liability.

Note 6 : Expenditure on Corporate Social Responsibility:

(a) Gross amount required to be spent by the Company during the year - Rs. 65.72 Lakhs (March 31,2017: Rs. 44.04 Lakhs)

Note 7 : Previous Years'' Figures:

The financial statements have been prepared in accordance with the Companies (Indian Accounting Standards) Rules, 2015 (Ind-AS) prescribed under Section 133 of the Companies Act, 2013 and other recognised accounting practices and polices to the extent applicable. The Company has adopted Ind-AS on April 1, 2017 with the transition date as April 1, 2016, and adoption was carried out in accordance with Ind-AS 101 - First Time Adoption of Indian Accounting Standards. The previous period''s figures have been regrouped or rearranged wherever necessary.

Mar 31, 2016

NOTE 1 : SHARE CAPITAL

(a) Terms / rights attached to equity shares:

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

(d) The Company completed its Initial Public Offering (IPO) pursuant to which 1,07,69,200 equity shares of the Company of Rs.10 each were allotted at a price of Rs. 65 per equity share consisting of a fresh issue of 87,42,611 equity shares and an offer for sale of 20,26,589 equity shares. The equity shares of the Company were listed on The National Stock Exchange of India Limited and BSE Limited on September 10, 2015._

(a) Nature of security and terms of repayment for Secured Borrowings :

Nature of Security Terms of Repayment

Rupee Term loan from State Bank of India amounting to Rs. 2 Lacs The Principal is repayable in monthly

(March 31, 2015: Rs. 22 Lacs) secured by way of Equitable mortgage of installments of Rs. 2.00 Lacs each. The Factory Land & Building situated at MIDC, Lote Parshuram, Taluka Khed, term loan carry interest rate @ Base Rate District Ratnagiri, Maharashtra standing in the name of the Company and 3.60%.

Hypothecation charge on Plant & Machinery and other movable assets situated at above plants.

-Personal guarantee of Mr. Punit Makharia and Mr. Gautam Makharia

(Promoter Directors of the Company)__

Rupee Term Loan from ICICI Bank amounting to Rs. 8.68 lacs (March 31, Repayable in 47 monthly installments, Rate 2015 : Rs. 24.65 lacs) secured by the vehicles purchased from the loan of interest 11.25% p.a.

proceedings.__

Rupee Term Loan from HDFC Limited Bank amounting to Rs. Nil (March Repayable in 36 monthly installments, Rate 31, 2015 : Rs.0.47 lacs) secured by the vehicles purchased from the loan of interest 11% p.a.

proceedings.__

Rupee Term Loan from HDFC Bank Limited amounting to Rs. 0.29 lacs Repayable in 36 monthly instalments, Rate (March 31, 2015 : Rs.1.90 lacs) secured by the vehicles purchased from of interest 10.50% p.a.

the loan proceedings.__

Rupee Term Loan from Reliance Capital Limited amounting to Rs. Nil Repayable in 35 monthly instalments, Rate (March 31, 2015 : Rs.2.24 lacs) secured by the vehicles purchased from of interest 12.53% p.a.

the loan proceedings.__

Rupee Term Loan from Kotak Mahindra Prime Limited amounting to Rs. Nil Repayable in 35 monthly installments, Rate (March 31, 2015 : Rs.1.44 lacs) secured by the vehicles purchased from of interest 11.64% p.a.

the loan proceedings.__

Rupee Term Loan from Volkswagen Finance Private Limited amounting Repayable in 36 monthly installments, Rate to Rs.6.67 lacs (March 31, 2015 : Rs.14.05 lacs) secured by the vehicles of interest 10.43% p.a.

purchased from the loan proceedings.__

Notes:

1) Working capital loans from State Bank of India Rs. 1,042.78 Lakh (March 31, 2015: Rs. 1,005.06 Lakh) carries interest rate

@ 10.80% p.a. and are secured as under:

a) Primary Security:

i) Hypothecation of the entire current assets of the company on paripassu basis with SBT and IDBI Bank.

b) Collateral Security:

i) Equitable mortgage of Factory Land and Building and the asset thereon, both present and future, located at B-97, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri

ii) Equitable mortgage by way of second pari-passu (with SBT & IDBI Bank) on Land & Building of the company located at B-102 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iii) Equitable mortgage by way of second pari-passu (with SBT & IDBI Bank) on Land & Building of the company located at B-103 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

iv) Equitable mortgage by way of second pari-passu (with SBT & IDBI Bank) on Land & Building of the company located at D-25 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company.

v) Equitable mortgage on B-97(admeasuring 11951 sq mtrs.) located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, standing in the name of company on first pari passu basis with SBT and IDBI Bank.

2) Working capital loans from IDBI Bank Limited Rs. 690.67 Lakh (March 31, 2015: Rs. 1,303.65 Lakh) carries interest rate @

11.80% p.a. and are secured as under:

a) Primary Security:

i) Hypothecation of the entire current assets of the company on paripassu basis with SBT and IDBI Bank.

b) Collateral Security:

i) Equitable mortgage by way of second parri-passu charge(with SBT and SBI) on Land and Building of the company located at B-102 at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, standing in the name of company.

ii) Equitable mortgage by way of second parri-passu charge(with SBT and SBI) on Land and Building of the company located at B-103 at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, standing in the name of company.

iii) Equitable mortgage by way of second parri-passu charge(with SBT and SBI) on Land and Building of the company located at D-25 at MIDc, Lote Parshuram, Taluka Khed, District Ratnagiri, standing in the name of company.

iv) Hypothecation charge on Plant & Machinery on second pari-passu basis (with SBT & SBI Bank) of the company located at B-102, B-103 and D-25 located at MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra.

3) Working capital loans from State bank of Travankore Rs. 0.002 Lakh (March 31, 2015: Rs. 130.76 Lakh) carries interest rate @ 11.80% p.a. and are secured as under:

a) Primary Security:

Hypothecation of the entire current assets of the company on paripassu basis with SBI and IDBI Bank.

Note :

There are no Micro and Small Enterprises, to whom the Company owes dues, which are outstanding as at March 31,2016. This information has been determined on the basis of information available with the Company.

NOTE 2 : RELATED PARTY TRANSACTIONS

a. Details of Related Parties

Description of Relationship Names of Related Parties

Key Management Personnel (KMP) and their Mr. Punit Makharia - Chairman & Managing Director relatives Mr. Gautam Makharia - Joint Managing Director

Mr. Ratan Jha - Chief Financial Officer Mr. Kishan Bhargav - Company Secretary Mrs. Ranjana Makharia - Wife of M.D Mrs. Aradhana Makharia - Wife of J.M.D Bhanu Makharia - Mother of M.D/J.M.D

Company in which KMP / Relatives of KMP can exercise - significant influence

Notes:

1) The list of related parties above has been limited to entities with which transactions have taken place during the year.

2) Related party transactions have been disclosed till the time the relationship existed.

NOTE 3 : OPERATING LEASE TRANSACTIONS Where the Company is a lessee:

The Company has taken Office Buildings & Godown under operating lease as per the requirement. The aggregate rental expenses for the year are Rs. 4,86,672 (2014-15: Rs. 11,05,213).

NOTE 4 : EXPENDITURE ON CORPORATE SOCIAL RESPONSIBILITY

(a) Gross amount required to be spent by the Company during the year - Rs. 24.21 Lacs

NOTE 5 : CURRENT ASSETS AND LOANS AND ADVANCES

In the opinion of the Board, all the assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the amount at which they are stated. The Provision of all known liabilities is adequate and not in excess of the amount reasonably necessary.

NOTE 6 : INITIAL PUBLIC OFFERING

During the year, the Company has made an Initial Public Offer (IPO) for 1,07,69,200 equity shares of Rs.10 each, comprising of 87,42,611 fresh issue of equity shares by the Company and 20,26,589 equity shares offered for sale by selling shareholders [India Enterprise Development Fund ("IEDF")]. The equity shares were issued at a price of Rs. 65 per equity share (including premium of Rs. 55 per share). Out of the total proceeds from the IPO of Rs. 7,000.00 Lacs, the Company''s share is Rs. 5,682.70 Lacs from the fresh issue of 87,42,611 equity shares. The total expenses in connection with the IPO amount of Rs. 551.43 Lacs, being the IPO expenses, is adjusted against the securities premium account. Further the Company has allotted 7,69,235 equity shares as Pre-IPO allotment at a price of Rs. 65 per equity share (including premium of Rs. 55 per share). Proceeds from this Pre-IPO allotment will also be utilized as mentioned in the Prospectus for IPO dated August 29, 2015.

Fresh equity shares were allotted by the Company on September 5, 2015 and these shares rank pari-passu with the existing shares. The equity shares of the Company were listed on The National Stock Exchange of India Limited and BSE Limited on September 10, 2015.

NOTE 7: TRADE RECEIVABLES AND TRADE PAYABLES

The balances in case of trade receivable, trade payable and loans and advances shown as per books of accounts, are subject to reconciliation and adjustment, if any.

NOTE 8 :In the past, the Company has provided a corporate guarantee for Rs. 511.00 Lacs towards housing loans availed by Mrs. Bhanu Makharia, mother of Mr. Punit Makharia, a director of the Company from Citibank N.A, which has been secured by way of a corporate guarantee provided by our Company, other than the primary security. Providing such corporate guarantee is a violation of provisions of the Section 295 of the Companies Act, 1956. The balance of such loans as at March 31, 2016 is Rs. 181.73 Lacs. Mrs. Bhanu Makharia is regularly paying the loans as per the EMI schedule and till now there is no any default in repayment of such loans. As per the information available, the market value of the assets so financed is more than the value of the corporate guarantee, therefore, in the opinion of the Management, the terms and conditions thereof are not prejudicial to the interest of the Company.

NOTE 9 : SEGMENT INFORMATION

Considering the nature of business and integrated manufacturing process of the Company, the Company considers its products under one segment only i.e. Chemicals & Fertilizers. Accordingly, Segment Reporting in accordance with Accounting Standard - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India and adopted by Companies (Accounting Standard) Rules, 2006 is not applicable to the Company.

NOTE 10 : PREVIOUS YEAR FIGURES

The Company has re-grouped, re-classified, recanted and/or re-arranged figures for previous year, wherever required to confirm with current year''s classification.

Mar 31, 2015

The company has no information as to whether any of its suppliers constitute Micro, Small or Medium Enterprises and therefore, the claims for suppliers and other related details as per the provisions of Micro, Small or Medium Enterprises Development Act, 2006 could not be ascertained. This has been relied by the auditors upon certificate by the management.

1. In the opinion of the Management, the Current Assets, Loans & Advances are approximately of the value stated and are realizable in the ordinary course of business. The provisions for all known liabilities are adequate.

2. There is no system of sending yearly confirmation letters in respect of balances reflected in respect of all significant Account under Trade Receivables, Trade Payable, Advance from Customers and Loans & Advances. Therefore, the balances under these heads have been shown as per books of accounts and are subject to reconciliation and adjustment, if any.

3. The Company has re-grouped, re-classified, recanted and/or re-arranged figures for previous year, wherever required to confirm with current year's classification.

4. Contingent Liabilities not provided for in books of accounts:

a. Corporate Guarantee of Rs, 171 (Previous Year Rs, 511 Lacs) give by company against housing loan taken by the relative of promoter director of the company.

b. Bank Guarantee amounting to Rs, 534.79 Lacs (previous year Rs, 259.45 Lacs) to suppliers of goods, services and electricity board.

5. The Company has adopted Accounting Standard - 15 (Revised 2005) for accounting of Employee Benefits and accordingly, the Company has classified various benefits provided to employee as under:

a. Defined Contribution Plans

The company has recognized the amounts of contribution to provident and other funds amounting to Rs, 1.67 Lacs (previous year Rs, 1.44 Lacs) in Profit & Loss account for the Period ended 31st March, 2015.

b. Defined Benefit Plans

The Company has provided Contribution to Gratuity Fund underfunded Scheme.

Expenses recognized in Profit & Loss account for the year ended 31/03/2015

6.Related Party disclosure

The names of the related parties, key management personnel, the nature of their transactions and their values are given herein below

A. List of Related Parties & their relationship

Punlt Makharla Chairman & Managing Director

Gautam Makharia Joint Managing Director

Ranjana Makharia Wife of M.D Relative of the Director

Aradhana Makharia Wife of J.M.D Relative of the Director

Bhanu Makhria Mother of M.D/J.M.D Relative of the Director

7. Segmental Information

Considering the nature of business and integrated manufacturing process of the Company, the Company considers its products under one segment only i.e. Chemicals & Fertilizers. Accordingly, Segment Reporting in accordance with Accounting Standard -17 "Segment Reporting" issued by the Institute of Chartered Accountants of India and adopted by Companies (Accounting Standard) Rules, 2006 is not applicable to the Company.

Mar 31, 2013

1. In the opinion of the Management, the Current Assets, Loans & Advances are approximately of the value stated and are realizable in the ordinary course of business. The provisions for all known liabilities are adequate.

2. Confirmation letters have been sent in respect of all significant balances reflected under Trade Receivables, Trade Payables, Advance from Customers and Loans & Advances. Since most of such parties did not respond to confirmation requests, the balances under these heads have been shown as per books of accounts and are subject to reconciliation and adjustment, if any.

3. As at 31 March 2012, the Company had received an amount of Rs, 195 Lacs towards Share Application Money for issuing Equity shares of the Company. The same has been refunded during the year.

4. The Company has re-group, re-classified and/or re-arranged figures for previous year, wherever required to confirm with current year's classification.

5. Contingent Liabilities not provided for in books of accounts:

a. Corporate Guarantee aggregating to Rs, 511 Lacs (previous year Rs, 511 Lacs) given by the Company against housing loans taken by the relative of promoter-directors of the Company

b. Bank Guarantee amounting to Rs, 259.45 Lacs (previous year Rs, 301.01 Lacs) to suppliers of goods and electricity board.

6. The Company has adopted the Accounting Standard - 15 (Revised 2005) for accounting of Employee Benefits and accordingly, the Company has classified various benefits provided to employee as under:

a. Defined Contribution Plans

The company has recognized the amounts of contribution to provident and other funds amounting to Rs, 1.44 Lacs (previous year Rs, 2.07 Lacs) in Profit & Loss account for the year ended 31st March, 2013. b. Defined Benefit Plans

The Company has provided Contribution to Gratuity Fund under funded Scheme.

7. Related Party Disclosures

The names of the related parties, key management personnel, the nature of their transactions and their values are given herein below:

A. List of Related Parties & their relationship

Punit Makharia Chairman & Managing Director

Gautam Makharia Joint Managing Director

Ranjana Makharia Relative of the Director

Aradhana Makharia Relative of the Director

Bhanu Makharia Relative of the Director

8. Segmental Information Considering the nature of business and integrated manufacturing process of the Company, the Company considers its products under one segment only i.e. Chemicals & Fertilizers. Accordingly, Segment Reporting in accordance with Accounting Standard - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India and adopted by Companies (Accounting Standard) Rules, 2006 is not applicable to the Company.

Mar 31, 2012

I. In the opinion of the Management, the Current Assets, Loans & Advances are approximately of the value stated and are realizable in the ordinary course of business. The provisions for all known liabilities are adequate.

ii. Confirmation letters have been sent by the Company in respect of balances reflected under Sundry Debtors, Sundry Creditors and Loans and Advances. In view of confirmations having been received from only some of the parties, the balance under these heads have been shown as per books of accounts and are subject to reconciliation and adjustment, if any.

iii. As at 31 March 2012, the Company has received an amount of Rs.195 Lacs towards Share Application Money for issuing preference shares of the Company (As at 31 March, 2011 Rs. 195 Lakhs). The Company is required to complete the allotment formalities by March - 2013. Presently the Company does not have sufficient authorized capital to cover the allotment of these shares.

iv. Contingent liabilities not provided for in books of accounts.

1. Corporate Guarantee aggregating to Rs. 511 Lacs (P.Y. Rs.511 Lacs) against housing loans taken by the Directors of the company.

2. Bank Guarantee of Rs. 301.01 Lacs (.P.Y. Rs.49.50 Lacs) to suppliers of goods and electricity board.

3. Disputed tax liabilities :-

v. Estimated Cost of Expansion is Rs. 10.95 Crores out of which 2.91 Crores is in WIP in 2011-12

vi. The company has no information as to whether any of its suppliers constitutes Micro, Small or Medium Enterprises and therefore, the claims for suppliers and other related data as per the requirement of Micro, Small or Medium Enterprises Development Act 2006 could not be ascertained.

vii. The company adopted the Accounting Standard (AS-15) (Revised 2005) "Employee Benefits", the company has classified the various benefits provided to employee as under;

a) Defined Contribution Plans:

The company has recognized the amounts of provided fund of Rs.1.97 Lacs (P.Y.Rs.1.89 Lacs) in Profit & Loss account for the year ended 31st March, 2012

b) Defined Benefit Plans:

The company has provided contribution to gratuity Fund (Funded Scheme).

viii. The financial statements for the year ended 31.03.2011 had been prepared as per the then applicable, pre revised schedule VI of the companies Act, 1956. Consequent to the notification of revised schedule VI under the companies Act, 1956, the financial statements for the year ended 31st March 2012 are prepared as per revised schedule VI. Accordingly, the previous year figures have also been re-classified to confirm to this year

ix. Related party Disclosures:

The names of the related parties, key management personal, the nature of their

transactions and their values are given herein below:

a) Key Managerial Personals

Name of related parties Nature of relationship

Punit Makharia Chairman & Managing Director

Gautam Makharia Joint Managing Director

Ranjana Makharia Relative of the Director

Aradhana Makharia Relative of the Director

Bhanu MaKharia Relative of the Director

classification. The adoption of revised schedule VI for the previous year figures does not impact recognition & measurement principles followed for preparation of the financial statements. vi. Previous Year Figures have been audited by a firm other than K C P L & Associates.

Mar 31, 2011

1) In the opinion of directors provisions for all known liabilities have been made in the accounts.

2) Loan & advances, sundry debtors, sundry creditors and other liabilities are subject to confirmation and reconciliation. The balances are therefore as per the books of accounts.

3) Contingent liabilities not provided for in books of accounts.

1. Corporate Guarantee aggregating to Rs. 511 Lacs (P.Y. Rs.NIL Lacs) against housing loans taken by the Directors of the company.

2. Bank Guarantee of Rs. 49.50 Lacs (.P.Y. Rs,49.50 Lacs).

4) The company has no information as to whether any of its suppliers constitutes Micro, Small or Medium Enterprises and therefore, the claims for suppliers and other related data as per the requirement of Micro, Small or Medium Enterprises Development Act 2006 could not be ascertained.

5) The company adopted the Accounting Standard (AS-15) (Revised 2005) "Employee Benefits", the company has classified the various benefits provided to employee as under;

a) Defined Contribution Plans:

The company has recognised the amounts of Provided fund of Rs.1.89 Lacs (P.Y.Rs.1.48 Lacs) in Profit & Loss account for the year ended 31st March,2011

b) Defined Benefit Plans:

The company has provided contribution to gratuity Fund (Funded Scheme).

6) Related party Disclosures:

The names of the related parties, key management personal, the nature of their transactions and their values are given herein below: a) Key Managerial Personals

Name of related parties Nature of relationship

Punit Makharia Chairman & Managing Director

Gautam Makharia Director

Ranjana Makharia Relative of the Director

Aradhana Makharia Relative of the Director

Bhanu MaKharia Relative of the Director

7) Previous year's figures have been regrouped, rearranged and reclassified whenever necessary.

8) The additional information pursuant to paragraph 3,4 ( C) and (D) of part II of schedule VI to the companies Act, 1956.have given to the extent of applicable.

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