(I) General Corporate Information

M/s AANCHAL ISPAT LIMITED (the company) is a public limited company domiciled in India and incorporated
under the provisions of the Companies Act, 1956. The shares of the company are listed on Bombay Stock Exchange.
The company caters to domestic markets only. The company has been incorporated with the object of manufacturing of
Mild Steel TMT Re-bars, Structural Re-bars, Round and other Sectional products.

The Company also engages in trading of Mild Steel Billets, Cement and Clinker and TMT and Structural Re-Bars.

(II) Statement of compliance

Standalone financial statements have been prepared in accordance with accounting principles generally accepted in India
including Indian Accounting Standard (Ind AS) prescribed under the section 133 of the Companies Act.2013 read with
rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time) and presentation
requirement of Division II of Schedule III of the Companies Act 2013, as applicable to standalone financial statement.

(III) Basis of preparation and presentation

These financial statements of the Company are prepared under the historical cost except for certain financial instruments
that are measured at fair value at end of each reporting period. Historical cost is generally based on fair value of the
consideration given in exchange for goods and services

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date, regardless of whether that price is directly observable or estimated
using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account
the characteristics of the asset or liability if market participants would take those characteristics into account when
pricing the asset or liability at the measurement date.

In addition, for financial reporting purposes, fair value measurements are categorised in to Level 1, 2 or 3 based on the
degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair
value measurement in its entirety, which are described as follows:

• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity
can access at the measurement date;

• Level 2 inputs are inputs, other than quoted prices included in Level 1, that are observable for the asset or
liability, either directly or indirectly; and

• Level 3 inputs are unobservable inputs for the asset or liability

The Financial Statements is presented in INR and all values are rounded to the nearest lakhs (upto two decimal) except
when otherwise stated.

(IV) Use of Estimates

The preparation of separate financial statements in conformity with the recognition and measurement principles of Ind
AS requires the management of the Company to make estimates and assumptions that affect the reported balances of
assets and liabilities, disclosures relating to contingent liabilities as at the date of the separate financial statements and
the reported amounts of income and expense for the periods presented. Estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are
revised and future periods are affected. Future results could defer due to these estimates and the differences between the
actual results and the estimates are recognised in the periods in which the results are known/materialise.

(V) Revenue Recognition

(i) Sale of goods

Revenue from the sale of goods is recognised when the goods are delivered and titles have been passed, at which time
all the following conditions are satisfied:

• The Company has transferred to the buyer the significant risks and rewards of ownership of the goods;

• The Company retains neither continuing managerial involvement to the degree usually associated with
ownership not effective control over the goods sold;

• The amount of revenue can be measured reliably;

• It is probable that the economic benefits associated with the transaction will flow to the Company; and

• The costs incurred or to be incurred in respect of the transaction can be measured reliably.

(ii) Dividend and Interest income

Dividend income is recognised when the company’s right to receive dividend is established. Interest income is
recognised on a time proportion basis taking into account the amount outstanding and the effective interest rate
applicable.

(VI) Foreign currencies

Transactions in currencies other than entity's functional currency (foreign currency) are recorded at the rates of exchange
prevailing on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies remaining
unsettled at the end of the each reporting period are re-measured at the rates of exchange prevailing at that date.

(VII) Employee Benefits

i) Short-term benefits Short term employee benefits are recognised as an expense at the undiscounted amount in the
statement of profit and loss of the year in which the related service is rendered.

ii) Defined contribution retirement benefits Payments to defined contribution retirement benefits are recognised as an
expense when employees have rendered services entitling them to the contributions. Defined contribution plans are
those plans where the Company pays fixed contributions to funds/schemes. Contributions are paid in return for services
rendered by the employees during the year. The contributions are expensed as they are incurred in line with the treatment
of wages and salaries. The liability as on the balance sheet is ascertained by an independent actuarial valuation.

iii) Defined benefit retirement benefits the cost of providing defined benefit retirement benefits are determined &
recognised as per independent actuarial valuations report carried out at the end of each reporting period. The Company
provides gratuity to its employees. All actuarial gains or losses are recognised in the statement of profit and loss in the
period in which they occur.

(VIII) Taxation

i) Current tax

Current tax is payable based on taxable profit for the year. Taxable profit differs from 'profit before tax' as reported in
the statement of profit and loss because of items of income or expense that are taxable or deductible in other years and
items that are never taxable or deductible. The current tax is calculated using tax rates in accordance with the provisions
of the Income Tax Act, 1961.

ii) Deferred tax

Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting
income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is
measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date. Deferred tax
liabilities are recognised for all timing differences. Deferred tax assets in respect of unabsorbed depreciation and carry
forward of losses are recognised only if there is virtual certainty that there will be sufficient future taxable income
available to realise such assets. Deferred tax assets are recognised for timing differences of other items only to the extent
that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised.
Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax
laws and the Company has a legally enforceable right to such set off. Deferred tax assets are reviewed at each Balance
Sheet date for their reliability.

iii) Minimum alternate tax

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form
of adjustment to future income tax liability, is recognised as an asset in the balance sheet. When there is convincing
evidence that the Company will pay normal income tax during the specified period and it is probable that future
economic benefit associated with it will flow to the Company.

iii) Current and deferred tax for the year

Current and deferred tax are recognised in profit or loss, except when they are relating to items that are recognised in
other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in
other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial
accounting for a business combination, the tax effect is included in the accounting for the business combination.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and
the relevant entity intends to settle its current tax assets and liabilities on a net basis.

(IX) Property, Plant and equipment

a) Buildings and Roads, Plant and Equipment, Furniture and Fixtures and Vehicles held for use in the production or
supply of goods or services, or for administrative purposes are stated at cost less accumulated depreciation and
accumulated impairment losses. Cost includes purchase cost of materials, including import duties and non-refundable
taxes, any directly attributable costs of bringing an asset to the location and condition of its intended use and borrowing
costs capitalised in accordance with the Company's accounting policy.

Depreciation is recognised so as to write off the cost of assets (other than properties under construction) less their
residual values over the useful lives, using the straight-line method. Depreciation of assets commences when the assets
are ready for their intended use. The estimated useful lives and residual values are reviewed at the end of each reporting
period, with the effect of any changes is accounted as change in estimate on a prospective basis.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item
of property, plant and equipment is recognised in the statement of profit and loss.

The Company has elected to continue with the carrying value of all of its property, plant and equipment recognised as
of April 1, 2016 measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition
date.

(X) Intangible assets

Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortisation
and accumulated impairment (if any) losses. Amortisation is recognised over their estimated useful lives. The estimated
useful life and amortisation method are reviewed at the end of each reporting period, with the effect of any changes in
estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquire
separately are carried at cost less accumulated impairment losses. Estimated useful lives of the intangible assets are as
follows:

An intangible asset is derecognised upon disposal or when no future economic benefits are expected to arise from the
continued use of the asset. Any gain or loss arising on the disposal or retirement of intangible assets is recognised in the
statement of profit and loss.

The Company has elected to continue with the carrying value of all of its intangible assets recognised as of April 1,
2015 measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

(XI) Impairment of assets

The carrying values of assets/cash generating units at each balance sheet date are reviewed for impairment. If any
indication of impairment exists, the recoverable amount of such assets is estimated and impairment is recognised, if the
carrying amount of these assets exceeds their recoverable amount. The recoverable amount is the greater of the net
selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value
based on an appropriate discount factor. When there is indication that an impairment loss recognised for an asset in
earlier accounting periods no longer exists or may have decreased such reversal of impairment loss is recognised in the
Statement of Profit and Loss.

(XII) Inventories

Raw materials, work-in-progress and finished products are valued at lower of cost and net realisable value after
providing for obsolescence and other losses, where considered necessary and stores and Spares are valued at cost less
write off for obsolescence. Cost includes purchase price, non refundable taxes and duties and other directly attributable
costs incurred in bringing the goods to the point of sale. Work-in-progress and finished goods include appropriate
proportion of overheads and, where applicable, excise duty. Net realisable value is the price at which the inventories
can be realised in the normal course of business after allowing for the cost of conversion from their existing state to a
finished condition and for the cost of marketing, selling and distribution.

Stores and spares are valued at cost comprising of purchase price, non refundable taxes and duties and other directly
attributable costs after providing for obsolescence and other losses, where considered necessary.