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Notes to Accounts of Surya Roshni Ltd.

Mar 31, 2023

Nature and purpose of reserves

a. Capital Redemption Reserve

Capital Redemption Reserve was created on redemption of preference share capital. The Company may issue fully paid-up bonus share to it''s members out of the capital redemption reserve.

b. Capital Reserve

Capital reserve has been created on Business Combination on appointed date i.e.1st April 2016 Pursuant to the Scheme of Arrangement amongst company and its associate e-Surya Global Steel Tubes Limited as per order of NCLT dated 11th December 2017.

c. Securities premium

Securities premium is used to record the premium on issue of shares. The premium should be utilised in accordance with the provisions of the Companies Act.

d. Share Option Outstanding Account

The Share option outstanding account relates to share options granted by the Company to its employees under its employee share option plan. Further information about share-based payments to employees is set out in note 48.

e. Forfeiture reserve

Forfeiture Reserve represents the forfeiture of amount of consideration received on allotment of warrants of the cases where option to take equity shares were not exercised within the prescribed time in accordance with Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009

f. General reserve

The general reserve is created time to time to transfer profits from retained earnings for appropriation purposes. As the general reserve is created by transfer from one component of equity to another equity, hence items included in general reserve will not be reclassified subsequently to profit and loss.

g. Dividend

Final Dividend of '' 21.76 crores for the Year 2022-23 ( Dividend of '' 21.76 crores for the Year 2021-22) is accounted in the year of approval by the shareholders

Term Loans of '' NIL ('' 60.67 crore as at 31st March, 2022) were secured by way of first pari-passu charge on all Property, plant and equipment including equitable mortgage of Land and Building and further secured by way of second pari-passu charge on Company''s entire Current Assets both present and future.

a. Rupee Term Loan from one bank of '' Nil ('' 35.67 crore as at 31st March, 2022) was payable in 21 quarterly instalments, with last repayment date 31st May, 2028, carrying floating interest rate of 6.25% p.a. Linked wiTH REPO RATE with periodical interest reset, which is fully pre-paid during the current year.

b. Rupee Term Loan from one financial institution aggregating '' NIL ('' 25.00 crore as at 31st March, 2022) was payable in 29 quarterly instalments, with last repayment date 1st April, 2030, carrying fixed interest rate of 6.50% p.a. with periodical interest reset, which is fully pre-paid during the current year.

The above working Capital borrowings of '' 403.94 crore are secured against current assets both present and future and further secured by way of second charge on all Property, plant and equipment including equitable mortgage of Land and Building and personal guarantee of the Chairman of the Company. The Rupee Loans of '' 125.73 crore (EPC) linked with T Bill carrying interest rate of 4.75% ~ 5.08% (net of 2% Interest Subvention), '' 245.91 crore (wCDL) linked with T Bill carrying interest rate of 6.85 ~ 7.52 and '' 32.30 crore (Cash Credit) linked with 1 Year / 6 Month MCLR of respective banks plus spread (spread ranging from Nil ~ 75 bps)

III. Entry of Goods into Local Area Act, 2008 :

The Haryana Government levied Local Area Development Tax by (The LADT Act) w.e.f. 5th May, 2000, The said act was declared ultra vires by the hon''ble Punjab & haryana high Court on 14th March, 2007. Later on, the haryana government has repealed the LADT Act w.e.f. 8th April, 2008 and introduced in its place, ‘The haryana Tax on Entry of goods into local Areas Act, 2008'' , which was also held ultra vires by the hon''ble high Court on 1st October, 2008 (Rules not yet notified). Both these Acts were declared unconstitutional on the ground of non-compensatory. but Subsequently, on the SLP of the haryana government, the hon''ble Supreme Court Constitutional Bench vide its judgment dated 11th November, 2016 held the applicability of entry tax valid on compensatory grounds. however, directed its Divisional bench for examining the provisions on the other issues of discrimination, local area etc. The divisional bench remanded back the matters to the hon''ble Punjab & haryana high Court on 21st March, 2017 with a direction to file fresh writ petitions in this regard for factual backgrounds and other constitutional statutory issues. The matter is still pending in the hon''ble Punjab & haryana high Court, hence no provision has been made.

IV. Income Tax Act

In respect of Income-tax assessments of the Company (for the year 2009-10,2010-11 & 2012-13) demands of '' 56.34 cr. were raised wherein, Company had appealed and the cases were decided in favour of the Company by CIT (A). however revenue has preferred an appeal before ITAT. Based on the decision in favour of the Company, interpretations and decisions of appellate authorities and Courts in similar cases and as per the consultations made, the Company is not liable for such demand and accordingly no provision has been made.

The Company gives warranties on certain products, which fail to perform satisfactorily during the warranty period. Provision made represents the amount of expected cost of meeting such obligation on account of repair/ replacement. It is expected that significant portion of these cost is to be incurred within a period of two years.

45 GOVERNMENT GRANTS (INVESTMENT PROMOTION ASSISTANCE)

The Company has made investments of '' 362.35 crore up to 31st March, 2023 in the State of Madhya Pradesh, Andhra Pradesh and Gujarat for establishing manufacturing facilities at Malanpur, Hindupur and Anjar respectively as per provisions of the Industrial Investment Promotion Assistance Schemes/ Policy of these states.The Company has been eligible for periodical Grants during the specified period by way of assistance/ reimbursement of VAT/ CST/ SGST/ Power Cost and recognised the same in revenue on satisfying the conditions mentioned under the respective schemes/ policies. These incentive claims are periodically evaluated and necessary adjustments /reversals have been made time to time for deductions made or expected in processing, verifications, clarifications or change in policies/guidelines. Accordingly, The Company has recognised grants of '' 98.59 crore up to 31st March, 2023 ('' 105.58 crore up to 31st March, 2022 (Out of which '' 61.04 crore remained outstanding as on 31st March, 2023 and '' 70.11 crore as on 31st March, 2022).

46 PROJECT FOR SUPPLY, IMPLEMENTATION, OPERATION AND MAINTENANCE OF ORISSA GREENFIELD STREET LIGHTING SYSTEM THROUGH SPV COMPANY

The Company has been awarded project by Directorate of Municipal Administration(DMA), Orissa for designing, implementing, operating, maintaining the Greenfield Pubic Street Lighting System along with other infrastructure including CCMS and automation. The project is required to be executed through Special Purpose Vehicle Company (SPV) as per terms of LOA and accordingly Company has incorporated a wholly-owned subsidiary namely SuRYA ROSHNI LED Lighting PROJECTS LIMITED on 21st January, 2019. Further, Company has executed Supply Installation Operation and Maintenance (SIOM) Agreement on 29th December 2018 with the DMA and 21 urban Local Bodies. As per terms of SIOM, the Company had executed shareholder agreement with the SPV Company on 30th August, 2019 and novation agreement with the DMA and the SPV company . Company has committed the funding requirement of SPV for project completion including enhancement in the value of project. The Company has also committed to compensate the losses/ damages, if any.The required funding has been mandatory provided by the Company and project is being implemented efficiently.

47 EMPLOYEE BENEFITS

Disclosures pursuant to Ind AS -19 "Employee Benefits" (Specified under the section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards) Rule 2015 ( as amended from time to time) and other relevant provision of the Act) are given below

a. Discount rate is based on the prevailing market yields of Indian Government securities as at the balances sheet date for the estimated term of obligations.

b. The assumption of future salary increase takes into account the inflation, seniority, promotion, business plan, HR Policy and other relevant factors such as supply and demand in employment market.

a. The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

b. Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.

c. Their was no change in the method and assumptions used in preparing the sensitivity analysis from prior years.

A. Short-term benefits comprises the expenses recorded under the head employee benefit expenses (eg. Salary and wages, contribution to provident fund, NPS, Leave encashment payments, and taxable value of perquisities etc.

B. The liability for gratuity and compensated absences are provided on actuarial basis for the Company as a whole, amounts accrued pertaining to key managerial personnel are not included above.

C. The remuneration of directors and key executives is determined by the remuneration committee having regard to the performance of individuals and market trends.

D. The Company has granted Stock Options to eligible employees, including Executive Directors and KMPs, under its Employee Stock Option Schemes [within the meaning of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014] as amended. However, in accordance with Ind AS -102, the Company has recorded employee benefits expense by way of share based payments to employees at '' 7.01 crore for the year ended 31st March, 2023 [2022 - '' 6.53 crore].

50 SEGMENT INFORMATION

Description of segments and principal activities

The Chief operational decision makers (CODM) monitor the operating results of its Business Segments separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements. Operating segments have been identified on the basis of the nature of products/ services and have been identified as per the quantitative criteria specified in the Ind AS.

Specifically, the Company''s reportable segments under Ind AS are as follows:

1 Steel Pipe and Strips (comprises Steel pipes and cold rolled strips)

2 Lighting and consumer durables (comprises Lamps, fittings, street light, fans, electric appliances and allied items) Identification of Segments:

For financial statements presentation purposes, these individual operating segments have been aggregated into a singal operating segment after taking into consideration the similar nature of the products, production processes and other risk factors. For financial statements presentation purposes, these individual operating segment''s have been aggregated into a single operating segment taking into account the following factors:

i. These operating segments have similar long-term gross profit margins;

ii. The nature of the products and production processes are similar; and

iii. The methods used to distribute the products to the customer are same

The additional factors taken into consideration for aggregation into a single operating segment are as follows:

i. Operating revenues and expenses related to both third party and inter-segment transactions are included in determining the segment results of each respective segment.

ii. Finance expense incurred are not allocated to individual segment and the same has been reflected at the Company level for segment reporting.

iii. Segment assets represent assets directly managed by each segment, and primarily include receivables, property, plant and equipment, intangibles, inventories, operating cash and bank balances, inter-segment assets and exclude derivative financial assets, deferred tax assets and income tax recoverable.

iv. Segment liabilities comprise operating liabilities and exclude external borrowings, provision for taxes, deferred tax liabilities and derivative financial liabilities.

v. Segment capital expenditure comprises additions to property, plant and equipment and intangible assets (net of rebates, where applicable).

vi. unallocated expenses/ results, assets and liabilities include expenses/ results, assets and liabilities (including inter-segment assets and liabilities) and other activities not allocated to the operating segments. These also include current taxes, deferred taxes and certain financial assets and liabilities not allocated to the operating segments.

The financial assets measured at fair value are derivative contracts outstanding as at 31st March, 2022.

The fair value hierarchy is based on inputs to valuation techniques that are use to measure fair value that are either observable or unobservable and consists of the following three levels:

Level 1: Quoted prices in active markets for identical assets and liabilities

Level 2: Directly or indirectly observable market inputs, other than Level 1 inputs. This includes the assets and liabilities carried at forward contract rates / prevailing exchange rate at year end and assets carried at present value using appropriate discounting rate

Level 3: Inputs which are not based on observable market data.

53 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Risk Managemnet Committee oversees how management monitors compliance with the Company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. The Risk Management committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the Risk Management Committee. The Company is exposed to financial market risk, credit risk and liquidity risk.

I Financial Market risk

Financial market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of financial instrument. The value of a financial instrument may change as a result of change in the interest rates, foreign currency exchange rates and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign currency trade receivables, trade payables and borrowings.

a. 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 change in market interest rates. In order to optimise the Company''s position with regards to interest and to manage the interest rate risk, finance department performs a comprehensive corporate interest rate risk management by balancing the proportion of fixed rate with reset clause and floating rate financial instruments in its total portfolio. The borrowings of the Company are on floating interest rate along with periodical interest reset.

The Company is not exposed to significant interest rate risk at the respective reporting dates. With all other variables held constant, the following table demonstrates the impact of borrowing cost on floating rate portion of loans and borrowings are taken.

b. Foreign currency risk

The Company transacts business primarily in Indian Rupee, uSD and Pound sterling (GBP). The Company has taken foreign currency loans and has trade payables as well as receivables in foreign currency. The Company evaluates foreign currency exposure time to time and follows established risk management policies by taking foreign exchange forward contracts mostly with a maturity less than one year from the reporting date. The Company do not use derivate financial instrument for trading or speculation purpose to hedge exposure of foreign currency risk.The particulars of forward contract taken are given below :-

The net foreign currency exposure towards pending import / (export) orders in hand stands at (uSD 6.32 million) as at 31st March, 2023 (Previous year (uSD 14.35 million)).

II Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company''s receivables from customers and cash and cash equivalents. To manage this, the Company periodically assesses the financial risk limits of the customers, taking into account the payment behaviour, aging of outstanding, credit ratings, current economic trends, and analysis of historical bad debts, Further the Company makes provision for bad and doubtful debts on trade receivables based on Expected Credit loss (ECL) method based on provision matrix.

Trade Receivable

The Company''s exposure to credit risk is influenced by the individual characteristics of each customer, Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business. The Company has a detailed review mechanism of overdue trade receivables at various levels in the organisation to ensure proper attention and focus on realisation.

Expected credit loss assessment

Exposures to customers outstanding at the end of each reporting period are reviewed by the Company to determine incurred and expected credit losses. Management believes that the unimpaired amounts that are past due are still collectible in full, based on historical payment behaviour and extensive analysis of customer credit risk The movement in the allowances for impairment in respect of trade receivables during the year was as follows:

Cash and Cash Equivalents, Deposit in Banks and other Financial instruments

The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which balances and deposits are maintained. Generally, the balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances as it has sufficient vacant cash credit limits with its bankers. For other financial assets the Company monitors ratings, credit spreads and financial strengths of its counterparties. Based on its ongoing assessment of the counter party''s risk, the Company adjust its exposures to various counter parties. Based on the assessment there is no impairment in other financial assets.

Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. The Company''s finance department manage the liquidity through verity of sources of borrowings, by ensuring sufficient liquidity to meet its liabilities when due, under all circumstances, without incurring unacceptable losses or risk to the Company''s reputation. The current committed working capital facilities are used 50% to 60% and sufficient to meet its requirement. The Company monitor rolling forecast for its liquidity requirements.

Maturity profile of financial liabilities

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

54 CAPITAL MANAGEMENT

For the purposes of the Company''s capital management, capital includes issued capital and all other equity reserves. The primary objective of the Company''s Capital Management is to maximise shareholder value. The Board of Directors monitors the return on capital, dividend to shareholders, maintain balance between capital and borrowing in the light of changes in economic environment and the business requirements. In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings

Reasons for change in the ratio by more than 25% as compared to the preceding year

a. Current Ratio improved due to substantial reduction in Current Liabilities in comparison to last year wheras no major change in Current assets.

b. Debt Equity Ratio improved due to substantial reduction in Debt and increased total equity with higher profitability of current year.

c. Debt Service Coverage Ratio improved due to substantial reduction in Interest cost and NIL Debt repayment obligation with higher earnings of current year.

d. Return on Equity Ratio increased due to substantial increase in Profit after tax of the current year in comparison to Average net worth.

e. Trade Payable turnover ratio increased due to substantial reduction in Trade Payables whereas no major changes in Cost of Goods Sold.

f. Net profit ratio increased due to substantial increase in Profit after Tax whereas no major changes in Turnover

g. Return on Capital employed incrased due to higher EBIDTA and no major change in average capital employed

h. Return on Investment is reduced due to major supply and installation part of business has already excuted in Wholly-owned Subsidiary Company and consequently Profit has been reduced.

ESOS- Loan to Employees Welfare Trust

The Company has introduced Employees Stock Option schemes for its employees and hold 6,03,687 Treasury equity shares as on 31st March, 2023 (10,81,930 Treasury equity shares as on 31st March, 2022) acquired by way of secondary acquisition through Surya Roshni Employees welfare Trust and for the same provided funds by way of interest free loan to the Trust in compliance of Provisions of The Companies Act, 2013 and SEBI (SBEB Regulations), 2014 as amended having outstanding balance of '' 25.22 crore as on 31st March, 2023 ('' 36.50 crore as on 31st March, 2022)

55 The Company has made an assessment of the impact of the continuing Covid-19 pandemic on its current and future operations, liquidity position and cash flow giving due consideration to the internal and external factors. The Company is continuously monitoring the situation and does not foresee any significant impact on its operations and the financial position as at 31st March, 2023.

56 additional information

i. All title deeds of Immovable properties are held in name of the Company;

ii. The Company has no investment property hence disclosure of fair value of investment property is not applicable;

iii. The Company has not revalued its Property, Plant and Equipment ( including Right-of-use Assets), hence disclosure on the basis of its revaluation is not applicable;

iv. The Company has no intangible assets hence disclosure on the basis of its revaluation is not applicable;

v. No Loans or Advances in the nature of loans are granted to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013) , either severally or jointly with any other person, that are:

a. Repayable on demand; or

b. Without specifying any terms or period of repayment,

vi. No proceeding has been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder;

vii. The Company has borrowings from banks or financial institutions on the basis of security of current assets and quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts;

viii. The Company is not a declared wilful defaulter by any bank or financial institutions or other lender in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India;

ix. The Company has no transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of the Companies Act, 1956;

x. No charges or satisfaction are yet to be registered with ROC beyond the statutory period;

xi. The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017;

xii. No Scheme of Arrangement has been approved by the Competent Authority in terms of Section 230 to 237 of the Companies Act, 2013 during the year;

xii. A. The Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) 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

xiv. The Company has not traded or invested in Crypto currency or Virtual currency during the financial year, hence disclosure is not required;

xv. The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken at the balance sheet date;

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

57 The Company has perpetual system of balance confirmation and reconciliation of Trade receivables and Trade payables,

however at year end some of the balances remain subject to confirmation and reconciliation.

58 Previous Period figures are regrouped /reclassified wherever necessary in line with requirement of Schedule III to the

Companies Act 2013.

59 Approval of financial statements

The financial statements were approved for issue by the Board of Directors on 27th April, 2023


Mar 31, 2018

1. COMBINATION OF BUSINESS - COMPOSITE SCHEME OF ARRANGEMENT

A Scheme of Arrangement (hereinafter referred to as ‘Scheme'') amongst Surya Roshni Limited (Company) and its associate Surya Global Steel Tubes Limited ( eSGSTL) and their respective shareholders and creditors under section 230 to 232 of the Companies Act, 2013 has been sanctioned by the Hon''ble National Company Law Tribunal, Chandigarh Bench (NCLT) vide its Order dated 11th December, 2017 (made effective from 11th January,2018) and consequently business of Surya Global Steel Tubes Limited has been transferred to the Company and as per the scheme figures of previous year have been restated wherein the Company has recorded the assets and liabilities of ESGSTL at their respective book values as on the appointed date i.e. 1st April, 2016.

2. pre-operative EXPENSES capitalised DURING THE YEAR:

The Company has incurred capital expenditure at Hindupur for ERW steel pipes manufacturing unit and at Anjar unit for

3. LPE coating plant facilities, wherein following pre-operative expenses are capitalised

The assumption of future salary increase takes into account the inflation, seniority, promotion and other relevant factors such as supply and demand in employment market.

Note:

The Company has invested the plan assets in India only and closing value of the plan assets are the fair value of plan assets Sensitivity Analysis:

Significant actuarial assumptions for the determination of the defined obligation are discount rate, expected salary increase and withdrawal rate. The sensitivity analyses below have been determined based on reasonably possible changes of respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

Note :

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.

Their was no change in the method and assumptions used in preparing the sensitivity analysis from prior years.

4. RELATED pARTY TRANSACTIONS

In accordance with the requirements of IND AS 24, on related party disclosures, name of the related party, related party relationship, transactions and outstanding balances including commitments where control exits and with whom transactions have taken place during reported periods, are:

Notes:

A. Short-term benefits comprises the expenses recorded under the head employee benefit expenses (eg. Salary and wages, contribution to provident and other funds and staff welfare expenses).

B. The liability for gratuity and compensated absences are provided on actuarial basis for the Company as a whole, amounts accrued pertaining to key managerial personnel are not included above.

C. The remuneration of directors and key executives is determined by the remuneration committee having regard to the performance of individuals and market trends.

# Resigned from the Board of the company on March 27, 2017

5. SEGMENT INFORMATION

Description of segments and principal activities

The Chief operational decision makers (CODM) monitor the operating results of its Business Segments separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements. Operating segments have been identified on the basis of the nature of products/ services and have been identified as per the quantitative criteria specified in the Ind AS.

Specifically, the Company''s reportable segments under Ind AS are as follows:

1 Steel Pipe and Strips (comprises Steel pipes and cold rolled strips)

2 Lighting and consumer durables (comprises Lamps, fittings, fans, steel light, electric appliances and allied items) Identification of Segments:

For financial statements presentation purposes, these individual operating segments have been aggregated into a singal operating segment after taking into consideration the similar nature of the products, production processes and other risk factors. For financial statements presentation purposes, these individual operating segment''s have been aggregated into a single operating segment taking into account the following factors:

i. These operating segments have similar long-term gross profit margins;

ii. The nature of the products and production processes are similar; and

iii. The methods used to distribute the products to the customer are same

The additional factors taken into consideration for aggregation into a single operating segment are as follows:

i. Operating revenues and expenses related to both third party and inter-segment transactions are included in determining the segment results of each respective segment.

ii. Finance income earned and finance expense incurred are not allocated to individual segment and the same has been reflected at the Company level for segment reporting.

iii. The total assets disclosed for each segment represent assets directly managed by each segment, and primarily include receivables, property, plant and equipment, intangibles, inventories, operating cash and bank balances, inter-segment assets and exclude derivative financial assets, deferred tax assets and income tax recoverable.

iv. Segment liabilities comprise operating liabilities and exclude external borrowings, provision for taxes, deferred tax liabilities and derivative financial liabilities.

v. Segment capital expenditure comprises additions to property, plant and equipment and intangible assets (net of rebates, where applicable).

vi. Unallocated expenses/ results, assets and liabilities include expenses/ results, assets and liabilities (including inter-segment assets and liabilities) and other activities not allocated to the operating segments. These also include current taxes, deferred taxes and certain financial assets and liabilities not allocated to the operating segments.

* Amount carried at forward contract rate / prevailing exchange rate at year end classified in fair value hierarchy Level 2 The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: Quoted (unadjusted) prices in active markets for identical assets and liabilities

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

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

52 FINANCIAL RISK MANAGEMENT OBJECTIVES AND pOLICIES

The Company''s financial risk management is an integral part of how to plan and execute its business strategies. The Company''s principal financial liabilities (other than derivatives), comprise borrowings, trade and other payables. Likewise the financial assets consist of trade, other receivables, cash, short term deposits etc. . The financial liabilities and assets are arising due to borrowings and from its operations which are subject to financial risk.

Financial Market risk

Financial market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of financial instrument. The value of a financial instrument may change as a result of change in the interest rates, foreign currency exchange rates and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign currency trade receivables, trade payables and borrowings.

The Company manages financial market risk through treasury department, which evaluates and apply the risk mitigation strategy as approved by Audit Committee. The means of cash resources, implementing hedging strategies for foreign currency exposure, borrowing strategies, and ensuring compliance with market risks limits and policies are also monitored.

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 change in market interest rates. In order to optimize the Company''s position with regards to interest and to manage the interest rate risk, finance department performs a comprehensive corporate interest rate risk management by balancing the proportion of fixed rate with reset clause and floating rate financial instruments in its total portfolio. The borrowings of the company are on floating interest rate along with periodical interest reset.

The Company is not exposed to significant interest rate risk at the respective reporting dates. With all other variables held constant, the following table demonstrates the impact of borrowing cost on floating rate portion of loans and borrowings are taken.

Foreign currency risk

The Company transacts business primarily in Indian Rupee, USD and Pound sterling (GBP). The Company has taken foreign currency loans and has trade payables as well as receivables in foreign currency. The Company evaluates foreign currency exposure time to time and follows established risk management policies by taking foreign exchange forward contracts to hedge exposure of foreign currency risk and also some of the foreign currency exposure remains naturally hedged. The net exposure of foreign currency receivable in USD stand Rs, 11.50 crore as on 31st March 2018 (previous year Rs, 44.70 crore) after considering forwarding contracts taken by the company.

Credit risk

The Company is exposed to credit risk from its operating activities (primarily trade receivables). Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly. The Company considers the probability of default upon initial recognition of assets and whether there has been a significant increase in credit risk on an ongoing basis through each reporting period. To assess whether there is a significant increase in credit risk, the company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers reasonable and supportive forward-looking information.

Cash and Cash Equivalents, Deposit in Banks and other Financial instruments

The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which balances and deposits are maintained. Generally, the balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances other than those required for its day to day operations. For other financial assets the company monitors ratings, credit spreads and financial strengths of its counterparties. Based on its on-going assessment of the counter party''s risk, the company adjust its exposures to various counter parties. Based on the assessment there is no impairment in other financial assets.

Commodity price risk

The Company is exposed to the movement in price of key raw materials in domestic and international markets. The Company enter into contracts for procurement of material, and sale of it''s products as per the prevailing practice in the industry. The Company has in place policies to manage exposure to fluctuations in the prices of the key raw materials used in operations.

Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. The Company''s finance department manage the liquidity by mix of borrowing to meet fund requirements. The current committed borrowing limit are sufficient to meet its requirement. The Company monitor rolling forecast for its liquidity requirements.

Maturity profile of financial liabilities

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

6. Capital RISK MANAGEMENT

For the purposes of the Company''s capital management, capital includes issued capital and all other equity reserves. The primary objective of the Company''s Capital Management is to maximize shareholder value. The company manages its capital structure and makes adjustments in the light of changes in economic environment and the requirements of the financial covenants. In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches of the financial covenants of any interest bearing loans and borrowing for reported periods.

7.Expenditure ON R&D

Company has made Capital and Revenue expenditure from the financial year 2011-12 to 2017-18 in respect of its Unit : Surya Technology & Innovation Centre (R&D LAB) D-63, Hosiery Complex, Phase - II, Noida (U.P)as tabulated below : Capital & Revenue Expenditure Break-Up Financial Year Wise

Further, the capital and revenue expenditure as stated above of respective financial years of the above mentioned R & D Centre is reflected and forms part of the Fixed Assets (in case of capital expenditure) and Employee benefit expenses, Administrative expenses and other revenue expenses (in case of revenue expenditure) were grouped under relevant Notes / Schedules of the financial statements / Annual Accounts of respective financial years of the company. Development cost on intangible assets are Nil (previous year-Nil) during the year.

8. The Company has perpetual system of balance confirmation and reconciliation of Trade receivables and Trade payables, however at year end some of the balances remain subject to confirmation and reconciliation

9. The previous year figures have been reclassified to conform to Ind AS presentation required for this note (also refer note no.45)


Mar 31, 2017

1 Corporate and general information

Surya Roshni Limited (“SRL” or ‘‘the Company”) is domiciled and incorporated in India and its shares are publicly traded on the National Stock Exchange (‘NSE’) and the BSE Limited, in India. The registered office of SRL is situated at Prakash Nagar, Sankhol, Rohtak Road, Bahadurgarh -124507 (Haryana) India.

SRL is more than four decade old manufacturing conglomerate with business interest spanning Steel Pipes & Strips, Lighting, fittings, Fans, electric Appliances and PVC pipes & fittings. Besides enjoying market presence across the length and breadth of India, it also export products to more than 25 countries globally. Company is the largest GI Steel Pipe Manufacturer and the second largest in lighting in India.

These financial statements were approved and adopted by board of directors of the Company in their meeting dated 30th May, 2017.

2 Basis of preparation of financial statements & Use of estimates

2.1 Basis of preparation of financial statements

These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values, the provisions of the Companies Act, 2013 ( ‘the Act’) ( to the extent notified) and guidelines issued by the Securities and Exchange Board of India ( SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

The Company has adopted as applicable Ind AS standards and the adoption was carried out in accordance with Ind AS 101, First-Time Adoption of Indian Accounting Standards. The transition to Ind AS is April 1, 2015 which was carried out from Indian Accounting Principles generally accepted in India as prescribed under Section 133 of the Act, read with Rule 7 of the Companies( Accounts)Rules, 2014 ( IGAAP), which was the previous GAAP. Recommendations and descriptions of the effect of the transition have been summarized in Note 50.

Accounting policies have been consistently applied except where a newly-issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

2.2 Statement of compliance

The financial statements have been prepared in accordance with Indian Accounting Standard (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015.Upto the year ended 31st March, 2016, the Company prepared its financial statements in accordance with the requirements of previous GAAP, which includes Standards notified under the Companies (Accounting Standards) Rules, 2006. These are the Company’s first Ind AS financial statements. The date of transition to Ind AS is 1st April, 2015.

2.3 Use of estimates

The preparation of the financial statements in conformity with Ind AS requires the Management to make estimates, judgements and assumptions. These estimate, judgements and assumptions affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. The application of accounting policies that require critical accounting estimates involving complex and subjective judgements and the use of assumptions in these financial statements have been disclosed in Note 4. Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as the Management becomes aware of the changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and if material, their effects are disclosed in the notes to the financial statements.

3 Critical accounting estimates, assumptions and judgements

In the process of applying the Company’s accounting policies, management has made the following estimates, assumptions and judgements, which have significant effect on the amounts recognised in the financial statement:

a) Property, plant and equipment - Useful lives of assets

The Company reviews the useful life of assets at the end of each reporting period. This reassessment may result in change in depreciation expenses in future periods.

b) Warranties

The Company generally offers Warranties for its consumer products and the liability towards warranty-related costs are recognized in the year of sales or service provided to the customers. Management ascertain and measure the liability for warranty claims based on historical experience and trend. The assumptions made in relation to current year are consistent of those are in prior years.

c) Provision and Contingencies

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made. Contingent liabilities are disclosed in the notes. Contingent assets are not recognised in the financial statements.

4 TRADE RECEIVABLES (CURRENT)

The Company exposure to credit risk is influenced mainly by individual characteristic of each customers. However the Company also considers the factors that may influence the credit risk of its customer’s base including the default risk associated with the industry. The company reviews the credit risk of each customer individually .The company review includes external ratings, if available, financial statements, industry information, trading history with the Company, information available in public domain and existence of the previous financial difficulties. An impairment analysis is performed at each reporting date on an individual customer basis. The concentration of credit risk is limited due to the fact that customer base is large and unrelated. At every reporting date, the historical observed default rates and changes in the forward-looking estimates are reviewed / analysed.

I Terms / rights attached to equity shares

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

Notes :

a. Capital Redemption Reserve

Capital Redemption Reserve was created on redemption of preference share capital. The Company may issue fully paid-up bonus share to it’s members out of the capital redemption reserve account

b. Securities premium account

Securities premium reserve is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Act.

c. Forfeiture reserve

Forfeiture Reserve represents the forfeiture of amount of consideration received on allotment of warrants of the cases where option to take equity shares were not exercised within the prescribed time in accordance with Chapter VII of SEBI (Issue of Capital & Disclosure Requirements) Regulations, 2009

d. General reserve

The general reserve is used time to time to transfer profits from retained earnings for appropriation purposes. As the general reserve is created by transfer from one component of equity to another equity, hence items included in general reserve will not be reclassified subsequently to profit and loss.

e. Dividend

Proposed Dividend on Equity Shares is subject to approval at annual general meeting and not recoginised as liability.

Term Loans are secured by way of first pari-passu charge on all fixed Assets of the Company including equitable mortgage of Land & Building and further secured by way of second pari-passu charge on Company’s entire Current Assets both present & future and personal guarantee of the Chairman of the Company.

a Rupee Term Loans from banks aggregating Rs.39.35 crore (as at 31.03.2016 Rs.110.19 crore; as at 01.04.2015 Rs.272.73 crore) are payable in 28 (maximum) quarterly installments, with last repayment date 30th September,2025, carrying floating interest rate linked with MCLR of respective banks ranging from MCLR 80 bps to 90 bps spread with periodical interest reset.

b Rupee term loans from financial institutions of Rs.42.66 crore (as at 31.03.2016 Rs.51.00 crore; as at 01.04.2015 Rs. Nil crore) are repayable maximum up to 22 quarterly installments with last repayment date 1st September 2022, carrying interest rate linked with 1 year G-sec. 275 bps spread with periodical interest reset.

c Foreign Currency Term Loan from banks aggregating Rs.258.10 crore (as at 31.03.2016 Rs.220.62 crore; as at 01.04.2015 Rs.159.39 crore) are payable in 28 (maximum) quarterly installments, with last repayment date 30th September,2025, carrying floating interest rate ranging from LIBOR 200 bps to 275 bps spread with periodical interest reset.

Working Capital Loans are secured against Company’s entire Current Assets both present and future and further secured by way of second charge on all Fixed Assets of the Company including equitable mortgage of Land & Building and personal guarantee of the Chairman of the Company. The commercial paper(s) carrying interest rate from 6.55% to 7.05%, rupee loans linked with MCLR of respective banks ranging from MCLR 10 to 90 bps spread and foreign currency loan from LIBOR 200 to 275 bps spread.

5 INCOME TAX

The gross movement in the current income tax asset/ (liability) for the year ended March 31, 2017 and March 31, 2016 is as follows: During the year ended March 31, 2017 and March 31, 2016, company has taken deduction/ availed exemption;

a) Under section 32AC of the Income-Tax Act, 1961 @ 15% on New Plant & Machinery installed during 2016-17 and 2015-16,

b) Under section 80-IC of the Income-Tax Act on 30% Profits of eligible industrial undertaking.

c) Deduction of expenses @ 200% in accordance with the provisions of Section 35(2AB) of the Income-Tax Act, 1961 on Research & Development Unit of the Company.

During the year ended March 31, 2017, company has taken deduction under section 32AD of the Income-Tax Act, 1961 @ 15% on the Plant & Machinery installed at newly set-up unit at Hindupur in the notified backward area of the state of Andhra Pradesh.

6 LEASES

The company have leasing arrangements in the nature of operating leases for premises (offices / godown etc.). These leasing arrangements are cancellable and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent in the statement of profit and loss.

7 EXPENDITURE INCURRED ON CORPORATE SOCIAL RESPONSIBILITY

Details of expenditure on Corporate Social Responsibility Activities as per Section 135 of the Companies Act, 2013 read with schedule III are as below:

It is not possible to predict the outcome of the pending litigations with accuracy, the Company believes, based on legal opinions received, that it has meritorious defences to the claims. The management believe the pending actions will not require outflow of resources embodying economic benefits and will not have a material adverse effect upon the results of the operations, cash flows or financial condition of the Company.

8 GOVERNMENT GRANT

Madhya Pradesh Industrial Investment Promotion Assistance Scheme- 2004 (MPIIPAS-2004)

The Company has made investment of Rs. 122.11 Crores in the eligible investment period as per the provisions of Madhya Pradesh Industrial Investment Promotion Assistance Scheme- 2004 (Scheme) by establishing manufacturing facilities for ERW Pipes etc. (under diversification) and expansion in its CFL facilities at Malanpur a notified backward district of Madhya Pradesh.

The Company has been sanctioned assistance to the extent of aforesaid investment by way of exemption from Entry-tax for 5 Years on procurement and 75% assistance of VAT/CST deposited for 10 Years from 28th March, 2010 to 27th March, 2020.

The Company has recognized revenue of Rs.3.84 Crores during the year (Rs.26.43 Crores up to 31st March, 2017) on satisfying the conditions mentioned under the said scheme.

Madhya Pradesh Industrial Investment Promotion Assistance Scheme- 2010 (MPIIPAS-2010)

The Company has also made further investment of Rs.80.62 Crores up to 31st March, 2017 as per the provisions of ongoing scheme of Madhya Pradesh Industrial Investment Promotion Assistance Scheme- 2010 (Scheme) for expansion in ERW Pipes and for production of LED products (Lamps, Street lights, Tube lights, Down-lighters, Drivers and Fittings) at Malanpur a notified backward district of Madhya Pradesh. As per the provisions of this Scheme, Company is further eligible to make investment up to 31st March, 2018 subject to compliances associated with the said scheme.

The Company has been sanctioned assistance to the extent of aforesaid investment by way of exemption from Entry-tax for 5 Years on procurement and 75% assistance of VAT/CST deposited for 10 Years from 2nd March, 2015 to 1st March, 2025.

The Company has recognized revenue of Rs.7.79 Crores during the year (Rs.13.00 Crores up to 31st March, 2017) on satisfying the conditions mentioned under the said scheme.

Andhra Pradesh Industrial Investment Policy (IDP) 2015-2020

The Company has set-up new ERW steel pipe manufacturing unit at Hindupur District Ananthapuram a backward district of Andhra Pradesh at a Capital investment of Rs.59.65 Crores in the financial year 2016-17. As per Andhra Pradesh Industrial Development Policy (IDP) 2015-2020 the said unit is entitled for from the date of commencement i.e. 1st March, 2017, the following benefits which are as follows:

1 Refund of Stamp Duty on purchase of land amounting to Rs.0.18 Crore.

2 Partial re-imbursement of power cost@ Re 1.00 per unit for a period of five years (i.e. up to 28th February, 2022). During the year amount recognized is Rs.0.04 Crore.

3 Company has been sanctioned assistance to the extent of aforesaid investment by way of 50% assistance of VAT/CST/SGST deposited for 7 Years from 1st March, 2017 to 29th February, 2024. The Company has recognized revenue of Rs.0.13 Crores during the year on satisfying the conditions mentioned under the said scheme.

9 PRE-OPERATIVE EXPENSES CAPITALISED DURING THE YEAR

The Company has set-up newly ERW steel Pipes manufacturing unit at Hindupur District Ananthapuram a backward district of Andhra Pradesh in the financial year 2016-17 at a Capital Investment of Rs. 59.65 crore including the capitalisation of following pre-operative expenses:

10 EMPLOYEE BENEFITS

Expense recognised for defined contribution plan and included in employee benefit expenses:

The principal actuarial assumptions used for estimating the Company’s defined benefit obligations are set out below:

Sensitivity Analysis:

Significant actuarial assumptions for the determination of the defined obligation are discount rate, expected salary increase and withdrawal rate. The sensitivity analyses below have been determined based on reasonably possible changes of respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant

Note :

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.

Their was no change in the method and assumptions used in preparing the sensitivity analysis from prior years.

Estimate of expected benefit payments (In absolute terms i.e. undiscounted)

Maturity profile of Defined Benefit Obligation As at March 31, 2017

11 RELATED PARTY TRANSACTIONS

In accordance with the requirements of IND AS 24, on related party disclosures, name of the related party, related party relationship, transactions and outstanding balances including commitments where control exits and with whom transactions have taken place during reported periods, are:

Notes:

A. Short-term benefits comprises the expenses recorded under the head employee benefit expenses (eg. Salary and wages, contribution to provident and other funds and staff welfare expenses).

B. The liability for gratuity and compensated absences are provided on actuarial basis for the Company as a whole, amounts accrued pertaining to key managerial personnel are not included above.

C. The remuneration of directors and key executives is determined by the remuneration committee having regard to the performance of individuals and market trends.

12 SEGMENT INFORMATION

Description of segments and principal activities

The Chief operational decision makers (CODM) monitor the operating results of its Business Segments separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements. Operating segments have been identified on the basis of the nature of products/ services and have been identified as per the quantitative criteria specified in the Ind AS.

Specifically, the Company’s reportable segments under Ind AS are as follows:

1 Steel pipe & strips (comprises Steel pipes and cold rolled strips)

2 Lighting & consumer durables (comprises Lamps, fittings, fans, electric appliances and allied items)

Identification of Segments:

For financial statements presentation purposes, these individual operating segments have been aggregated into a singal operating segment after taking into consideration the similar nature of the products, production processes and other risk factors. For financial statements presentation purposes, these individual operating segment’s have been aggregated into a single operating segment taking into account the following factors:

i. These operating segments have similar long-term gross profit margins;

ii. The nature of the products and production processes are similar; and

iii. The methods used to distribute the products to the customer are same

The additional factors taken into consideration for aggregation into a single operating segment are as follows:

i. Operating revenues and expenses related to both third party and inter-segment transactions are included in determining the segment results of each respective segment.

ii. Finance income earned and finance expense incurred are not allocated to individual segment and the same has been reflected at the Company level for segment reporting.

iii. The total assets disclosed for each segment represent assets directly managed by each segment, and primarily include receivables, property, plant and equipment, intangibles, inventories, operating cash and bank balances, inter-segment assets and exclude derivative financial assets, deferred tax assets and income tax recoverable.

iv. Segment liabilities comprise operating liabilities and exclude external borrowings, provision for taxes, deferred tax liabilities and derivative financial liabilities.

v. Segment capital expenditure comprises additions to property, plant and equipment and intangible assets (net of rebates, where applicable).

vi. Unallocated expenses/ results, assets and liabilities include expenses/ results, assets and liabilities (including inter-segment assets and liabilities) and other activities not allocated to the operating segments. These also include current taxes, deferred taxes and certain financial assets and liabilities not allocated to the operating segments.

Notes :

i. Unallocated assets are comprises investment in associate company, income tax refundable etc.

ii. Unallocated liabilities are comprises borrowings, provision for income tax, deferred tax etc.

iii. All assets are allocated to reportable segments other than investments in associate, current tax assets and other current assets.

iv. All liabilities are allocated to reportable segments other than borrowings, current and deferred tax liabilities. Liabilities for which reportable segments are jointly liable and allocated in proportion to segment assets.

V. Geographical information

The Company operates in seven geographical areas: India (country of domicile), Asia, Africa, North-America, Central America, South-America and Europe.

The Company’s revenue from operations from customers by location of operations and information about its non-current assets by location of assets are detailed below:

VI. Information about major customers

Company has no single customer from whom the revenue is not less than 10 % of the revenue from extenrnal customers of the company

13 TRANSITION TO IND AS

Basis of preparation

For all period up to and including the year ended March 31, 2016, the Company has prepared its financial statements in accordance with generally accepted accounting principles in India (Indian GAAP). These financial statements for the year ended March 31, 2017 are the Company’s first annual IND AS financial statements and have been prepared in accordance with IND AS.

Accordingly, the Company has prepared financial statements which comply with IND AS applicable for periods beginning on or after April 1, 2015 as described in the accounting policies. In preparing these financial statements, the Company’s opening Balance Sheet was prepared as at April 1, 2015 the Company’s date of transition to IND AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP Balance Sheet as at April 1, 2015 and its previously published Indian GAAP financial statements for the quarter ended March 31, 2016 and year ended March 31, 2016.

Exemptions Applied

IND AS 101 First-time adoption of Indian Accounting Standards allows first time adopters certain exemptions from the retrospective application of certain IND AS, effective for April 1, 2015 opening balance sheet.

Following exceptions to the retrospective application of other IND AS as per Appendix B of IND AS 101.

1 Embedded derivatives - The Company has assessed whether an embedded derivative is required to be separated from the host contract and as per assessment no material embedded derivative is identified and hence no embedded derivative is accounted for.

Following exemptions availed from other IND AS as per Appendix D of IND AS 101.

1 Deemed cost for Property, Plant and Equipment (PPE) - The Company has elected to measure items of PPE at the date of transition to IND AS to continue with the previous carrying GAAP value.

Life and salvage value of assets has been revisited on transition date and revised estimated life less life expired on date of transition has been considered as revised life for all assets. The impact of change in life and salvage value is provided in Note no 5.

2 Under previous GAAP, company was carrying assets at revaluation assessed to fair value assets with corresponding increase in revaluation reserve. On transition to IND AS the Company has elected not to carry those assets at revaluation done under previous GAAP and those assets are carried on at previous carrying GAAP value excluding revaluation amount. On transition revaluation reserve has been adjusted against retained earnings. The impact of such measurement is provided in summary of effect of transition.

3 Long Term Foreign Currency Monetary Items

The Company has opted to continue the policy adopted for accounting for exchange differences arising from translation of long term foreign currency monetary items recognised in the financial statements for the period ending immediately before the beginning of the first IND AS financial reporting period as per the previous GAAP, accordingly the Company has continued the capitalised of forex on long term loan outstanding on the date of transition i.e. April 1, 2015 and such capitalised amount is amortised over the remaining useful life of the asset.

4 Investments in associates

The Company has recognized the investment in associate at previous GAAP carrying value on the date of transition.

5 The Company has decided to disclose prospectively from the date of transition the following as required by IND AS 19

i The present value of the defined benefit obligation, the fair value of the plan assets and the surplus or deficit in the plan, and

ii The experience adjustments arising on;

a) The plan liabilities expressed as either an amount or a percentage of the plan liabilities at the end of the reporting period; and

b) The plan assets expressed as either an amount or a percentage of the plan liabilities at the end of the reporting period.

Under previous GAAP the Company was considering leave encashment as defined benefit plan as there was not difference in previous GAAP for accounting of experience adjustments and impact of change in actuarial assumption. On transition to IND AS, the Company has considered leave encashment as short term benefit and consequently experience adjustments and impact of change in actuarial assumption is accounted in P & L.

6 The Company has applied the transition provision in Appendix C of IND AS 17, “Determining whether an arrangement contains a Lease”, and has assessed all arrangement as at the date of transition.

7 Fair value of financial assets and liabilities

The Company has financial receivables and payables that are non-derivative financial instruments. Under previous GAAP, these were carried at transactions cost less allowances for impairment, if any. Under IND AS, these are financial assets and liabilities which are initially recognised at fair value and subsequently measured at amortised cost, less allowance for impairment, if any. For transactions entered into on or after the date of transition to IND AS, the requirement of initial recognition at fair value is applied prospectively.

Impact of transition to IND AS

The following is summary of the effects of the differences between IND AS and Indian GAAP on the Company’s total equity shareholders’ funds and profit and loss for the financial period for the periods previously reported under Indian GAAP following the date of transition to IND AS.

Principal differences between IND AS and Indian GAAP Measurement and recognition difference for year ended March 31, 2016

1 Property, Plant and Equipment

i. Asset carried at Deemed cost in IND AS

On transition to IND AS , Company has opted to continue with the previous carrying GAAP value at the transition date of Property, Plant & Equipment.

ii. The Company has not elected to carry assets at revaluation done under previous GAAP, revaluation reserve carrying value of Rs.179.35 crores has been adjusted against retained earnings on transition.

2 Financial instruments i. Derivative financial instruments

Under Indian GAAP, derivative contracts are measured at fair value at each balance sheet date to the extent of any reduction in fair value, and the loss on valuation is recognised in Statement of Profit and Loss. A gain on valuation is only recognised by the Company if it represents the subsequent reversal of an earlier loss. Also under IGAAP premium on forward contracts are amortised over the contract period and fair value was calculated excluding the premium.

Under IND AS, both reductions and increases to the fair values of derivative contracts are recognised in profit & loss.

Premium is not separately accounted and amortised.

ii Fair valuation of financial assets and liabilities

Under Indian GAAP, receivables and payables were measured at transaction cost less allowances for impairment, if any.

Under IND AS, these financial assets and liabilities are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less allowance for impairment, if any. The resulting finance charge or income is included in finance expense or finance income in the Statement of Profit and Loss for financial liabilities and financial assets respectively.

iii Investment in associate

As per the para D14 and D15 of Appendix D of IND AS 101 first time adoptions of IND AS company has the options to value investments in associates either Deemed cost or Previous GAAP of which the company has opted to continue with the previous carrying GAAP value.

iv Cost of borrowing

Borrowing designated and carried at amortised cost.

3. Proposed Dividend

Under Indian GAAP, proposed dividends are recognised as liability in the period to which they relate irrespective of the approval by shareholders. Under IND AS a proposed dividend is recognised as liability in the period in which it is declared (on approval of shareholders in a general meeting) or paid. Therefore the proposed dividend and dividend distribution tax of Rs. 5.26 crores on March 31, 2015 has been derecognised and recognised during 2015-16 on payment. Similarly proposed dividend and dividend distribution tax of Rs. 5.28 crores as on March 31, 2016 has been derecognised and recognised during 2016-17.

4 Deferred Tax

The Company has accounted for deferred tax on the various adjustments between Indian GAAP and IND AS at the tax rate at which they are expected to be reversed.

5 The impact of change in actuarial assumption and experience adjustments for defined benefit obligation towards gratuity liability is accounted in the Statement of Other Comprehensive Income and corresponding tax impact on the same. Due to this Rs.1.39 crores and Rs.3.05 crores for the period ended March 31, 2016 and March 31, 2017 respectively, tax credit there on is shown in OCI and reversal in Statement of Profit and loss.

6 Statement of Cash Flows

The impact of transition from Indian GAAP to IND AS on the Statement of Cash Flows is due to various reclassification adjustments recorded under IND AS in Balance Sheet, Statement of Profit & Loss and difference in the definition of cash and cash equivalents and these two GAAP’s.

7 Depreciation on Property, Plant and Equipment

Depreciation on Property, Plant and Equipment has been calculated on the value taken in IND AS and on revised useful life evaluated by technical valuer.

There were no significant reconciliation items between cash flow prepared under Indian GAAP and those prepared under IND AS Recent Accounting Pronouncement Standards issued but not yet effected

In March 2017, the Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards) (Amendments) Rules, 2017, notifying amendments to Ind AS 7, ‘Statement of cash flows’ and Ind AS 102, ‘Share-based payment.’ These amendments are in accordance with the recent amendments made by International Accounting Standards Board (IASB) to IAS 7, ‘Statement of cash flows’ and IFRS 2, ‘Share-based payment,’ respectively. The amendments are applicable to the Company from April 1, 2017.

Amendment to Ind AS 7:

The amendment to Ind AS 7 requires the entities to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes, suggesting inclusion of a reconciliation between the opening and closing balances in the balance sheet for liabilities arising from financing activities, to meet the disclosure requirement.

The said amendment being only a disclosure requirement has not any impact either on the profit and loss for the period or any assets and liabilities recognised in the balance sheet.

Amendment to Ind AS 102:

The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of cash-settled awards and awards that include a net settlement feature in respect of withholding taxes.

It clarifies that the fair value of cash-settled awards is determined on a basis consistent with that used for equity-settled awards. Market-based performance conditions and non-vesting conditions are reflected in the ‘fair values’, but non-market performance conditions and service vesting conditions are reflected in the estimate of the number of awards expected to vest. Also, the amendment clarifies that if the terms and conditions of a cash-settled share-based payment transaction are modified with the result that it becomes an equity-settled share-based payment transaction, the transaction is accounted for as such from the date of the modification. Further, the amendment requires the award that include a net settlement feature in respect of withholding taxes to be treated as equity-settled in its entirety. The cash payment to the tax authority is treated as if it was part of an equity settlement.

As on date, there are no transactions to be settled through share based payments. Accordingly there is no impact of the amendments on the company.

14 FINANCIAL INSTRUMENTS

Fair value of financial assets and liabilities

The fair value of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Comparison by class of the carrying amounts and fair value of the Company’s financial instruments that are recognised in the financial statements are set out below.

* Amount carried at forward contract rate / prevailing exchange rate at year end The following methods and assumptions were used to estimate the fair values:

1 The carrying amount of Trade receivables, Trade payables and Cash & cash Equivalent are considered to be the same as their values due to their short term nature.

2 The carrying amount of the financial assets and liabilities carried at amortised cost is considered a reasonable approximation of fair value.

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

Level 1: Quoted (unadjusted) prices in active markets for identical assets and liabilities

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

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

15 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company’s financial risk management is an integral part of how to plan and execute its business strategies. The Company’s principal financial liabilities, other than derivatives, comprise borrowings, trade and other payables. The main purpose of these financial liabilities is to manage finances for the Company’s operations. The Company has loan and other receivables, trade and other receivables, and cash and short-term deposits that arise directly from its operations and subject to financial risks

Financial Market risk

Financial market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of financial instrument. The value of a financial instrument may change as a result of change in the interest rates, foreign currency exchange rates and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency receivables, payables and loans and borrowings.

The Company manages financial market risk through finance department, which evaluates and apply the risk mitigation strategy as approved by Audit Committee. The means of cash resources, implementing hedging strategies for foreign currency exposure, borrowing strategies, and ensuring compliance with market risks limits and policies are also monitored.

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 change in market interest rates. In order to optimize the Company’s position with regards to interest and to manage the interest rate risk, finance department performs a comprehensive corporate interest rate risk management by balancing the proportion of fixed rate with reset clause and floating rate financial instruments in its total portfolio. The borrowings of the company are on floating interest rate along with periodical interest reset.

The Company is not exposed to significant interest rate risk at the respective reporting dates. With all other variables held constant, the following table demonstrates the impact of borrowing cost on floating rate portion of loans and borrowings are taken.

Foreign currency risk

The Company is exposed to various foreign currencies for exports, imports, borrowings etc. out of which some of the portion is naturally hedged by purchasing of goods, commodities and services in the respective currencies. Further the Company evaluates exchange rate exposure arising from foreign currency transactions and the Company follows established risk management policies, including the use of derivatives like foreign exchange forward contracts to hedge exposure to foreign currency risk. The net exposure of foreign currency receivable in USD stands at Rs.2.89 crores as on 31st March, 2017(previous year Rs.6.07 Cr.)

Credit risk

The Company is exposed to credit risk from its operating activities (primarily trade receivables). Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.

The Company considers the probability of default upon initial recognition of assets and whether there has been a significant increase in credit risk on an ongoing basis through each reporting period. To assess whether there is a significant increase in credit risk, the company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers reasonable and supportive forward-looking information.

Cash and Cash Equivalents, Deposit in Banks and other Financial instruments

The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which balances and deposits are maintained. Generally, the balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances other than those required for its day to day operations. For other financial assets the company monitors ratings, credit spreads and financial strengths of its counterparties. Based on its ongoing assessment of the counter party’s risk, the company adjust its exposures to various counter parties. Based on the assessment there is no impairment in other financial assets.

Commodity price risk and sensitivity

The Company is exposed to the movement in price of key raw materials in domestic and international markets. The Company has in place policies to manage exposure to fluctuations in the prices of the key raw materials used in operations. The Company enter into contracts for procurement of material, and sale of it’s products as per the prevailing practice in the industry.

Liquidity risk

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

Maturity profile of financial liabilities

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

16 CAPITAL RISK MANAGEMENT

For the purposes of the Company’s capital management, capital includes issued capital and all other equity reserves. The primary objective of the Company’s Capital Management is to maximize shareholder value. The company manages its capital structure and makes adjustments in the light of changes in economic environment and the requirements of the financial covenants. In order to achieve this overall objective, the Company’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches of the financial covenants of any interest bearing loans and borrowing for reported periods.

17 In respect of Income-tax assessments of the Company (for the year 2009-10 & 2010-11) demand of Rs.40.70 cr. were raised wherein, Company had appealed and the case were decided in favour of the Company by CIT (A). Revenue has preferred an appeal before ITAT. But based on the decision in favour of the company, interpretations and decisions of appellate authorities and Courts in similar cases and as per the consultations made, the Company is not liable for such tax and accordingly no provision has been made.

18 EXPENDITURE ON R&D

Company has made Capital and Revenue expenditure from the financial year 2011-12 to 2016-17 in respect of its Unit : Surya Technology & Innovation Centre (R&D LAB) D-63, Hosiery Complex, Phase - II, Noida (U.P)as tabulated below :

Capital & Revenue Expenditure Break-Up Financial Year Wise

Further, the capital and revenue expenditure as stated above of respective financial years of the above mentioned R & D Centre is reflected and forms part of the Fixed Assets (in case of capital expenditure) and Employee benefit expenses, Administrative expenses and other revenue expenses (in case of revenue expenditure) were grouped under relevant Notes / Schedules of the financial statements / Annual Accounts of respective financial years of the company. Development cost on intangible assets are Nil (previous year-Nil) during the year.

19 The Company has perpetual system of balance confirmation and reconciliation of Trade receivables and Trade payables, however at year end some of the balances remain subject to confirmation and reconciliation.

20 The previous GAAP figures have been reclassified to confirm to Ind AS presentation required for this note

21 LOCAL AREA DEVELOPMENT ACT:

The Hon’ble Supreme Court (9 Judges Constitutional Bench) vide judgement dated 11th November, 2016 decided about the applicability of Entry Tax / Local Area Development Tax (LADT) is constitutionally valid on account of compensatory issue but directed that the provisions of respective Acts have to be separately examined by Division Bench of Hon’ble Supreme Court on the issues of discrimination, local area and import of goods etc. The Divisional Bench remanded the matter to the respective High Court on 21st March, 2017 and also allowed filing of new petitions/ grounds.

Earlier , The Haryana Government notified the Entry of Goods into Local Area Act, 2008 by repealing the earlier Act of The Local Area Development Act, 2000 (The Hon’ble Punjab & Haryana High Court has decided the Act ultra-vires on 14th March, 2017 and decided in favour of the Company) but no final rules were notified by the Government.

Based on the facts of our case and the consultations made by the Company, no provision has been made.


Mar 31, 2016

NOTE NO. 1

The Excise department has disallowed CENVAT Credit of Rs. 1,31,05,538/- on certain Plant and Machinery for which the Company has filed appeal. The same has been considered as Claims Receivable and the same shall be recognized in the year in which the matter will be finally settled.

2.RELATED PARTY DISCLOSURES

As per Accounting Standard 18, the disclosures of transactions with whom transactions have taken place and relationships:

A. Relationship:

i. Associate Company

- Surya Global Steel Tubes Limited

ii. Key Managerial Personnel (KMPs)

- Shri Jai Prakash Agarwal, Chairman

- Shri Raju Bista, Managing Director

- Shri Utkarsh Dwivedi, Whole time Director (Resigned in Dec’15)

- Shri R. N. Maloo, ED & Group CFO

- Shri Ramanjeet Singh, CEO (Lighting Operations)

- Shri Tarun Baldua, CEO (Steel Operations)

- Shri B. B. Singal, Sr. V.P & Company Secretary

iii. Relatives of Key Managerial Personnel (KMPs)

- Sh. Rajesh Bista (Brother of Managing Director)

B. Transactions carried out with the related parties in the ordinary course of business:

i) Associate:

1. Surya Global Steel Tubes Ltd.

Investment in Equity Shares

3 Note on Financials of Associate:

As per the provisions of Companies Act, 2013 read with Rule 6 of the Companies (Accounts) Rules, 2014, Consolidation of financial statements of the company shall be made in accordance with the provisions of Schedule III of the Act and the applicable Accounting Standards. The MCA vide general circular no. 04/2016 dated 27th April, 2016 ‘MCA’ clarified that the amended Accounting Standards (including AS-21) be applicable from the Financial Year 2016-17, resulting thereby that presentation of Consolidation of Financial Statements is not required for the Financial Year 2015-16.

The Company has no subsidiary and have only one Associate namely Surya Global Steel Tubes Limited engaged in manufacturing of Spiral Welded Pipes and ERW pipes and is situated in west coast of India at Anjar near Bhuj in the state of Gujarat near International sea port, Mundra & Kandla. Brief financials as at 31st March, 2016 is summarized as under:

4 The figures of the previous year have been re-arranged and/ or re-grouped where-ever considered necessary and practicable to make them comparable with current year figures.

5 The Balance of Sundry Debtors and Sundry Creditors are subject to confirmation.

6 The Income-tax assessments of the Company were completed upto financial year 2012-13 in last year wherein demands of Rs. 40,69,74,683/- were raised. Aggrieved with the orders, Company had filed the Appeals with stay of demand. The cases are being contested before the CIT(Appeals) and based on the interpretations of the relevant provisions, decisions of Appellate authorities in similar cases and as per the consultations made, the Company is not liable for such tax and accordingly no provision has been made.

7 Expenditure on R&D

Company has made Capital and Revenue expenditure from the financial year 2011-12 to 2015-16 in respect of its Unit : Surya Technology & Innovation 1Centre (R&D Lab) D-63, Hosiery Complex, Phase - II, Noida (U.P) as tabulated below :

Further, the capital and revenue expenditure as stated above of respective financial years of the above mentioned R & D Centre is reflected and forms part of the Fixed Assets (in case of capital expenditure) and Employee benefit expenses, Administrative expenses and other revenue expenses (in case of revenue expenditure) were grouped under relevant Notes / Schedules of the financial statements / Annual Accounts of respective financial years of the company.

NOTE 8 SEGMENT INFORMATION FOR THE YEAR ENDED 31ST MARCH, 2016 AND 31ST MARCH,2015 The company has identified the following two Primary Business Segments :

9. Steel - Engaged in the production and sale of Steel Tubes & Pipes and Cold Rolled Strips

10. Lighting - Engaged mainly in the manufacture and sale of different varieties of Lamps, fittings, Fans, Appliances & allied items Secondary Segment reporting has been performed on the basis of Geographical Locations.

Statement containing salient features of the financial statement of subsidiaries/associate companies/ joint ventures Part- A : Subsidiaries

Company has no subsidiary hence no information is required to be disclosed under Part -A Notes:

1. Names of subsidiaries which are yet to commence operations None

2. Names of subsidiaries which have been liquidated or sold during the year. None

Notes:

1. Names of associates or joint ventures which are yet to commence operations None

11. Names of associates or joint ventures which have been liquidated or sold during the year. None


Mar 31, 2015

Note no. 1

Disclosure pursuant to Note no. T of Part I of Schedule III to the Companies Act, 2013 Contingent Liabilities and commitments (to the extent not provided for)

Particulars As at As at 31.03.2015 31.03.2014

Rs. Rs. Contingent Liabilities

Claims against the company not acknowleged as debt; 1,89,18,530 2,29,30,777

Guarantees; 57,11,62,451 87,74,13,692

Corporate Guarantee in favour of Banks for providing term loans to Surya Global Steel Tubes Limited:

Sanctioned term loans amount - Rs. 135 Crores;

Outstanding term loans amount 21,00,00,000 56,00,00,000

Bonds executed by the Company to Custom Department against export obligation under EPCG Scheme 24,70,92,877 27‚44‚70‚372

Other money for which the company contingently liable - -

Total 1,04,71,73,858 1,73,48,14,841

Commitments

Estimated amount of contracts remaining to be executed on capital 8,65,00,000 - account and not provided for;

Total 8,65,00,000 -

2 The figures of the previous year have been re-arranged and/ or re-grouped where ever considered necessary and practicable to make them comparable with current year's figures.

3 Consequent to the introduction of Schedule II of the Companies Act, 2013 becoming effective from

April 1, 2014, the company have re-worked depreciation with reference to the estimated useful lives of fixed assets prescribed under Schedule II of the Act or re-assessed by the Company as per technical evaluation. As a result, the charge for depreciation is higher by Rs. 48,06,121 for the quarter and is higher by Rs. 4,89,95,121 for the Year ended 31st March, 2015. Further based on transitional provision as per Note 7(b) of Schedule II, an amount of Rs. 11,65,04,928 has been adjusted to the retained earnings.

4 The Balance of Sundry Debtors and Sundry Creditors are subject to confirmation.

5 The Income-Tax Assessments of the Company have been completed up to Financial Year 2012-13 where in demands of Rs. 40,69,74,682 have been raised and for which company has filed appeal with stay of demand. However, based on the interpretations of the relevant provisions, decisions of Appellate authorities in the similar cases and as per consultations made by the company, the company is not liable for any tax and accordingly no provision has been made.


Mar 31, 2014

1. Contingent Liabilities and commitments (to the extent not provided for)

Disclosure pursuant to Note no.T of Part I of Schedule VI to the Companies Act, 1956

Particulars As at As at 31.03.2014 31.03.2013

Rs. Rs.

Contingent Liabilities

Claims against the company not acknowleged as debt; 2,29,30,777 2,29,30,777

Guarantees; 87,74,13,692 38,30,21,910

Corporate Guarantee in favour of Banks for providing term loans to Surya Global Steel Tubes Limited:

Sanctioned term loans amount - Rs. 135 Crores;

Outstanding term loans amount- Rs. 56 Crores 1,35,00,00,000 1,35,00,00,000

Bonds executed by the Company to Custom Department against export obligation under EPCG Scheme 27,44,70,372 33,25,45,469

Other money for which the company is contingently liable - -

Total 2,52,48,14,841 2,08,84,98,156

Commitments

Estimated amount of contracts remaining to be executed on capital - - account and not provided for;

Total - -

2.Consequent upon opting for Central Excise exemption w.e.f. 02-01-2006 based on Notification No. 50/2003 dated 10-06-2003, cenvat credit of Rs.1,34,61,135/- was claimed on account of input credits by Factory and the same shall be recognised in the year in which the matter will be finally settled by the appropriate authorities.


Mar 31, 2013

1.1 Consequent upon opting for Central Excise exemption w.e.f. 02-01-2006 based on Notifi cation No. 50/2003 dated 10-06- 2003, cenvat credit of Rs.1,34,61,135/- was claimed on account of input credits by Kashipur Factory and the same shall be recognised in the year in which the matter will be fi nally settled by the appropriate authorities.

1.2.1 Outstanding 54,75,000 Optionally Convertible Warrants (Series 3) of Rs. 111/- each (Rs. 27.75/- paid-up) due for conversion on or before 29th May, 2012 stands lapsed and the total consideration of Rs. 15,19,31,250/- as paid – up money has been forfeited by the Company due to non – exercising option of conversion by warrant holders on or before 29th May, 2012 as per Regulation 77(4) of SEBI (Issue of Capital & Didclosure Requirements) Regulations, 2009.

1.3 Related party disclosures

Related party disclosures as required under Accounting Standard on "Related Party Disclosures" issued by the Institute of Chartered Accountants of India are given hereunder :

A. Relationship :

i) Subsidiary Company

- Surya Global Steel Tubes Ltd. ii) Other Companies

1. Surya Global Steel & Gen Power Limited

2. Surya Global Cement Limited

3. Surya Global Infrastructure Limited

4. Surya Roadlink and Infra Limited

5. Surya Vijay Nagar Steel & Power Limited

6. Surya Vijay Nagar Cement Limited

7. Surya Chhatisgarh Steel & Power Limited

8. Surya Chhatisgarh Power Limited

9. Surya Gujarat Power Limited

10. Surya Shimoga Lighting Limited

11. Surya Shimoga Steel Pipes Limited iii) Key Management Personnel

- Sh. J.P. Agarwal - (Chairman)

- Sh. Raju Bista - (Managing Director)

NOTE - 2

SEGMENTS INFORMATION for the year ended 31st March, 2013 and 31st March, 2012

The company has identifi ed the following two Primary Business Segments :

1. Steel - Engaged in the production of Steel Tubes & Pipes and Cold Rolled Strips

2. Lighting - Engaged mainly in the manufacture of different varieties of Lamps & related products Secondary Segment reporting has been performed on the basis of Geographical Locations.


Mar 31, 2012

Note no. 1

Disclosure pursuant to Note no.T of Part I of Schedule VI to the Companies Act, 1956

Contingent Liabilities and commitments (to the extent not provided for)

As at As at Particulars 31.03.2012 31.03.2011 Rs Rs;

Contingent Liabilities

Claims against the company not acknowleged as debt; 2,29,30,777 2,29,30,777

Guarantees; 28,49,86,993 26,20,59,274

Coporate Guarantee in favour of PNB and SBI for providing 1,35,00,00,000 1,35,00,00,000 term loans to Subisidiary Company

Bonds executed by the Company to Custom Department against export obligation under EPCG Scheme 33,25,45,469 33,25,45,469

Other money for which the company is contingently liable " -

Total 1,99,04,63,239 1,96,75,35,520

Commitments

Estimated amount of contracts remaining to be executed - 2,50,97,765 on capital account and not provided for;

Total - 2,50,97,765

NOTE NO. 2

2.1 Consequent upon opting for Central Excise exemption w.e.f. 02-01-2006 based on Notification No. 50/2003 dated 10-06-2003, cenvat credit of Rs.1,34,61,135/- was claimed on account of input credits by Kashipur Factory and the same shall be recognised in the year in which the matter will be finally settled by the appropriate authorities.

2.2 Company had outstanding 54,75,000 Optionally Convertible Warrants (Series 3) as on 31st March, 2012.

2.3 Related party disclosures

Related party disclosures as required under Accounting Standard on "Related Party Disclosures" issued by the Institute of Chartered Accountants of India are given hereunder :

A. Relationship :

i) Subsidiary Company

- Surya Global Steel Tubes Ltd

ii) Other Companies

1. Surya Global Steel & Gen Power Limited

2. Surya Global Cement Limited

3. Surya Global Infrastructure Limited

4. Surya Roadlink and Infra Limited

5. Surya Vijay Nagar Steel & Power Limited

6. Surya Vijay Nagar Cement Limited

7. Surya Chhatisgarh Steel & Power Limited

8. Surya Chhatisgarh Power Limited

9. Surya Gujarat Power Limited

10. Surya Shimoga Lighting Limited

11. Surya Shimoga Steel Pipes Limited

iii) Key Management Personnel & their Relatives :

Remuneration for the year 2011-2012 :

- Sh. J.PAgarwal (Chairman & Managing Director) Rs. 2,400

Sitting Fees for the year 2011-2012

Smt. Urmil Agarwal * (Director) Rs. Nil

* Resigned on 11th November, 2011'


Mar 31, 2011

1. Contingent liabilities not provided for in respect of :

(a) Bank Guarantee outstanding Rs. 26,20,59,274 (Previous Year Rs. 41,29,62,403)

(b) Disputed Excise duties, Sales / VAT taxes liability Rs.1,88,03,777 (Previous year Rs. 3,21,97,554).

(c) Bonds executed by the company to custom department against fulfilment of export obligation under 5% EPCG Scheme Rs. 33,25,45,469 (Previous year Rs. 32,08,19,889).

(d) Disputed ESI liability Rs. 34,55,828 (Previous year Rs. 34,55,828).

(e) Disputed demand of Uttaranchal Power Corporation Rs. 41,27,000 (Previous year Rs. 41,27,000).

(f) Corporate Guarantee(s) of Rs. 90 Crores in favour of PNB and Rs. 45 Crores in favour of SBI for providing term loans to Surya Global Steel Tubes Limited, a subsidiary of the Company (Previous Year Rs. 90 Crores and 45 Crores)

2. Estimated amount of contracts remaining to be executed on capital account (less advances) Rs. 2,50,97,765 (Previous year – Rs. 9,30,09,604 )

3. Consequent upon opting for Central Excise exemption w.e.f. 02-01-2006 based on Notification No. 50/2003 dated 10-06-2003, cenvat credit of Rs.1,34,61,135/- was claimed on account of input credits by Kashipur Factory and the same shall be recognised in the year in which the matter will be finally settled by the appropriate authorities.

4. Revaluation Reserve

The land has been revalued as on 31st March, 2011.The book value of the land was Rs. 22,91,49,151 and it has been revalued at Rs. 208,08,87,024 resulting an increase in the book value by Rs. 185,17,37,873 which had been transferred to revaluation reserve.

5. The Company has amounts due to Micro and Small Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act).

Note. The information has been given in respect of such suppliers to the extent they could be identified as“ Micro and Small” enterprises on the basis of information available with the Company.

6. Company had outstanding 45,70,000 Optionally Convertible Warrants (Series 1) as on 31st March, 2010. Further during the year, consequent to the shareholders' approval in the Extra Ordinary General Meeting , the Company has issued 1,14,30,000 optionally convertible warrants (series 2) on preferential basis of Rs. 10/- each at premium of Rs. 73/- per warrant to Promoter and Promoter Group. For the said 1,14,30,000 warrants, the Company has received the 25% upfront money on 12th July,2010 amounting to Rs. 23,71,72,500/- Furthermore, 45,70,000 outstanding warrants and 1,14,30,000 warrants have been converted into Equity Shares on 22nd October, 2010, and 75% amount due on allotment of 45,70,000 equity shares amounting to Rs. 20,22,22,500/- and on 1,14,30,000 equity shares amounting to Rs. 71,15,17,500 have been duly received towards 1,60,00,000 equity shares to the applicants of Series 1 and Series2 respectively.

Further during the year, consequent to the shareholders' approval in the Extra Ordinary General Meeting , the Company has issued 54,75,000 optionally convertible warrants (Series 3) on preferential basis of Rs. 10/- each at premium of Rs. 101/- per warrant to Promoter and Promoter Group. For the said 54,75,000 warrants, the Company has received the 25% upfront money on 30th November, 2010 amounting to Rs. 15,19,31,250/-. The said 54,75,000 warrants are outstanding for conversion into equity shares as on 31st March, 2011.

7. Segment information for the year ended 31st March, 2011 and 31st March, 2010

The company has identified the following three Primary Business Segments :

1. Steel - Engaged in the production of Steel Tubes & Pipes and Cold Rolled Strips

2. Lighting - Engaged mainly in the manufacture of different varieties of Lamps & related products

3. Real Estate - Engaged mainly in the development & trade in Real Estate Secondary Segment reporting has been performed on the basis of Geographical Locations.

8. Related party disclosures

Related party disclosures as required under Accounting Standard on “Related Party Disclosures” issued by the Institute of Chartered Accountants of India are given hereunder :

A. Relationship :

i) Subsidiary Company

- Surya Global Steel Tubes Ltd.

ii) Associates

1. Surya Global Steel & Gen Power Limited

2. Surya Global Cement Limited

3. Surya Global Infrastructure Limited 4. Surya Roadlink and Infra Limited

5. Surya Vijay Nagar Steel & Power Limited

6. Surya Vijay Nagar Cement Limited

7. Surya Chhatisgarh Steel & Power Limited

8. Surya Chhatisgarh Power Limited

9. Surya Gujarat Power Limited

10. Surya Shimoga Lighting Limited

11. Surya Manufacturing India Limited

12. Surya Shimoga Steel Pipes Limited

iii) Key Management Personnel

- Sh. J.P Agarwal

iv) Relatives of the Key Management Personnel

Relation Sh. J.PAgarwal

Spouse Smt. Urmil Agarwal

Son(s) Sh. Vinay Surya

Daughter(s) Smt. Padmini & Smt. Bharti

Brother(s) Sh. V P Agarwal

Sister(s) Smt. Sudha Gupta

Mother Smt. Ganga Devi Agarwal

Father Sh. B D Agarwal

iii) Key Management Personnel & their Relatives :

Remuneration for the year 2010-2011 :

- Sh. J.P.Agarwal (Chairman & Managing Director) Rs. 1,48,60,200

Sitting Fees for the year 2010-2011 Smt. Urmil Agarwal (Director) Rs.35,000/-

9. (a) Previous year figures have been regrouped and rearranged wherever necessary.

(b) Figures have been rounded off to the nearest rupee.


Mar 31, 2010

1. Contingent liabilities not provided for in respect of :

(a) Letter of Credit / Bank Guarantees outstanding Rs. 41,29,62,403 (Previous year Rs. 40,50,64,835).

(b) Disputed Excise duties, Sales / VAT taxes liability Rs.3,21,97,554 (Previous year Rs. 1,88,03,777).

(c) Bonds executed by the company to custom department against fulfilment of export obligation under 5% EPCG Scheme Rs. 32,08,19,889 (Previous year Rs. 1,46,05,170).

(d) Disputed ESI liability Rs. 34,55,828 (Previous year Rs. 34,55,828).

(e) Disputed demand of Uttaranchal Power Corporation Rs. 41,27,000 (Previous year Rs. 41,27,000).

(f) Corporate Guarantee(s) of Rs. 90 Crores in favour of PNB and Rs. 45 Crores in favour of SBI for providing term loans to Surya Global Steel Tubes Limited, a subsidiary of the Company (Previous year . Nil).

2. Estimated amount of contracts remaining to be executed on capital account (less advances) Rs. 9,30,09,604 (Previous year - Rs. Nil )

3. Consequent upon opting for Central Excise exemption w.e.f. 02-01-2006 based on Notification No. 50/2003 dated 10-06-2003, cenvat credit of Rs.1,34,61,135/- was claimed on account of input credits by Kashipur Factory and the same shall be recognised in the year in which the matter will be finally settled by the appropriate authorities.

4. During the year, consequent to the shareholders approval in the Extra Ordinary General Meeting , the Company has issued 64,00,000 optionally convertible equity warrants on preferential basis of Rs. 10/- each at premium of Rs. 49/- per warrant to Promoter and Promoter Group. For the said 64,00,000 warrants, the Company has received the 25% upfront money on 15th December, 2009 amounting to Rs. 9,44,00,000/- Further, out of the said warrants, 18,30,000 warrants have been converted into Equity Shares, and 75% amount due on allotment amounting to Rs. 8,09,77,500/- has been duly received towards 18,30,000 equity shares to the applicants.

5. Segment Information for the year ended 31st March, 2010 and 31st March, 2009 The company has identified the following three Primary Business Segments :

1. Steel - Engaged in the production of Steel Tubes & Pipes and Cold Rolled Strips.

2. Lighting - Engaged mainly in the manufacture of different varieties of Lamps.

3. Real Estate - Engaged mainly in the develoment & trade in Real Estate Secondary Segment reporting has been performed on the basis of Geographical Locations

6. Related party disclosures Related party disclosures as required under Accounting Standard on "Related Party Disclosures" issued by the Institute of Chartered Accountants of India are given hereunder :

A. Relationship : i) Subsidiary Company - Surya Global Steel Tubes Ltd. ii) Associates 1. Surya Global Steel & Gen Power Limited 2. Surya Global Cement Limited 3. Surya Global Infrastructure Limited 4. Surya Roadlink and Infra Limited 5. Surya Vijay Nagar Steel & Power Limited 6. Surya Chhatisgarh Power Limited 7. Surya Gujarat Power Limited iii)Key Management Personnel - Sh. J. P. Agarwal iv) Relatives of the Key Management Personnel

7. The exchange difference of Rs. Nil (previous year Rs. 18,68,856/-) on account of borrowing for the purpose of acquiring fixed assets is debited to Profit and Loss Account in accordance with the Accounting Standard 11 issued by the Institute of Chartered Accountants of India.

8. (a) Previous year figures have been regrouped and rearranged wherever necessary.

(b) Figures have been rounded off to the nearest rupee. Unit This year Previous year Quantity Value (Rs.) Quantity Value (Rs.) Schedules

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