I. COMPANY OVERVIEW AND SIGNIFICANT ACCOUNTING
POLICIES
Company Overview
Blue Coast Hotels Limited (“the Company") is a Public limited company incorporated and domiciled in India
and has its listing on the BSE Limited and National Stock Exchange of India Limited. The addresses of its
registered office and principal place of business are disclosed in the introduction to the annual report. The
Company is in the business of Hospitality.
1.1 Basis for preparation of financial statements
These financial statements are prepared in accordance with the Indian Accounting Standards (Ind AS) notified
under the Companies (Indian Accounting Standards) Rules, 2015 as amended by the Companies (Indian
Accounting Standards) (Amendment) Rules, 2016, the relevant provisions of the Companies Act, 2013 (“the Act'')
and guidelines issued by the Securities and Exchange Board of India (SEBI), as applicable.
The financial statements are authorized for issue by the Board of Directors of the Company at their meeting held
on May 28, 2024.
Functional and Presentation Currency
The financial statements are presented in Indian Rupees, which is the functional currency of the Company and
the currency of the primary economic environment in which the Company operates.
Basis of measurement
These financial statements are prepared under the historical cost convention unless otherwise indicated.
Operating Cycle
Based on the nature of products/activities of the company and normal time between acquisition of assets and
their realisation in cash or cash equivalents, the company has determined its operating cycle as 12 months for the
purpose of classification of its assets and liabilities as current and non-current.
1.2 Use of Estimates and Judgements
The presentation of financial statements in conformity with Ind AS requires the management of the company to
make estimates, judgements and assumptions. These estimates, judgements and assumptions affect the
application of accounting policies and the reported balances of assets and liabilities, disclosures of contingent
assets and liabilities as at the date of financial statements and the reported amount of revenues and expenses
during the year. Examples of such estimates include provisions for doubtful debts, employee benefits, provisions
for income taxes, useful life of depreciable assets and provisions for impairments & others.
Accounting estimates could change from period to period. Actual results could differ from those estimates.
Appropriate changes in estimates are made as management becomes aware of 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 financial statements.
1.3. Property, Plant and Equipment (PPE)
The Company has elected to continue with the carrying value of all its property, plant and equipment as
recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP
and use that as the deemed cost as at the transition date pursuant to the exemption under Ind AS 101.
a) Free hold land is carried at cost. All other items of Property, plant and equipment are stated at cost, less
accumulated depreciation. The initial cost of PPE comprises its purchase price, including import duties and
non-refundable purchase taxes, and any directly attributable costs of bringing an asset to working condition
and location for its intended use, including relevant borrowing costs and any expected significant costs of
decommissioning, less accumulated depreciation and accumulated impairment losses, if any. Expenditure
incurred after the PPE have been put into operation, such as repairs and maintenance, are charged to the
Statement of Profit and Loss in the period in which the costs are incurred.
b) Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet
date is classified as capital advances under other non-current assets.
c) Capital work-in-progress in respect of assets which are not ready for their intended use are carried at cost,
comprising of direct costs, related incidental expenses and attributable interest.
d) The cost and related accumulated depreciation are eliminated from the financial statements upon sale or
retirement of the asset and the resultant gains or losses are recognized in the statement of profit and loss.
Assets to be disposed off are reported at the lower of the carrying value or the fair value less cost to sell.
1.4 Intangible Assets and Amortisation
Internally generated Intangible Assets - Research and Development expenditure
Expenditure pertaining to research is expensed as incurred. Expenditure incurred on development is capitalised
if such expenditure leads to creation of an asset and/or benefits are expected over more than one period,
otherwise such expenditure is charged to the Statement of Profit and Loss.
Expenditure providing benefits for more than one period is amortised proportionately over the periods during
which benefits are expected to occur.
Intangible Assets acquired separately
Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated
amortisation and accumulated impairment, if any. The Company determines the amortisation period as the
period over which the future economic benefits will flow to the Company after taking into account all relevant
facts and circumstances. The estimated useful life and amortisation method are reviewed periodically, with the
effect of any changes in estimate being accounted for on a prospective basis.
1.5 Depreciation
Depreciation is the systematic allocation of the depreciable amount of PPE over its useful life and is provided on a
straight-line basis over the useful lives as prescribed in Schedule II to the Act or as per technical assessment.
a) Depreciation on fixed assets is provided on straight-line method at the rates prescribed by the schedule II of
the Companies Act, 2013 and in the manner as prescribed by it except assets costing less than Rs. 5000/- on
which depreciation is charged in full during the year.
b) Intangible assets are amortized over their respective individual estimated useful life on straight line basis,
commencing from the date the asset is available to the company for its use. The estimated useful life of an
identifiable intangible asset is based on a number of factors including the effects of obsolescence, etc. The
amortization method and useful lives are reviewed periodically at end of each financial year.
1.6. Valuation of inventories
Stocks of raw materials and other ingredients have been valued on First in First Out (FIFO) basis, at cost or net
realizable value whichever is less, finished goods and stock-in-trade have been valued at lower of cost and net
realizable value, work-in-progress is valued at raw material cost up to the stage of completion, as certified by the
management on technical basis. Goods in transit are carried at cost.
1.7. Foreign Currency Transactions / Translations
i) Transactions denominated in foreign currency are recorded at exchange rates prevailing at the date of
transaction or at rates that closely approximate the rate at the date of the transaction.
ii) Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated into the
functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are
measured based on historical cost in a foreign currency are translated at the exchange rate at the date of the
transaction.
iii) Exchange differences on monetary items are recognised in the Statement of Profit and Loss in the period in
which they arise except for exchange differences on foreign currency borrowings relating to assets under
construction for future productive use, which are included in the cost of those assets when they are regarded
as an adjustment to interest costs on those foreign currency borrowings.
iv) Foreign exchange differences recorded as an adjustment to borrowing costs are presented in the statement of
profit and loss, as a part of finance cost. All other foreign exchange gains and losses are presented in the
statement of profit and loss on net basis.
v) In case of long term monetary items outstanding as at the end of year, exchange differences arising on
settlement / restatement thereof are capitalised as part of the depreciable fixed assets to which the monetary
item relates and depreciated over the remaining useful life of such assets. If such monetary items do not
relate to acquisition of depreciable fixed assets, the exchange difference is amortised over the maturity
period / up to the date of settlement of such monetary items, whichever is earlier, and charged to the
Statement of Profit and Loss.
1.8 Dividends
Final dividends on shares are recorded as a liability on the date of approval by the shareholders and interim
dividends are recorded as a liability on the date of declaration by the company's Board of Directors.
The dividend on the Cumulative Redeemable Preference shares is provided on an annual basis as per the
stipulation of Ind AS.
1.9 Leases
Leases under which the company assumes substantially all the risks and rewards of ownership are classified as
finance leases. When acquired, such assets are capitalized at fair value or present value of minimum lease
payments at the inception of lease, whichever is lower. Lease under which the risks and rewards incidental
to ownership are not transferred to lessee, is classified as operating lease. Lease payments under operating
leases are recognized as an expense on a straight line basis in net profit in the statement of profit and loss
over the lease term.
2.0 Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or
equity instrument of another entity.
Financial assets and financial liabilities are recognised when a Company becomes a party to the contractual
provisions of the instruments.
i) Initial Recognition and measurement
On initial recognition, all the financial assets and liabilities are recognized at its fair value plus or minus
transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial
liability except financial asset or financial liability measured at fair value through profit or loss ("FVTPL").
Transaction costs of financial assets and liabilities carried at fair value through the Profit and Loss are
immediately recognized in the Statement of Profit and Loss.
ii) Subsequent measurement
a) Financial assets carried at amortised cost
A financial asset is subsequently measured at amortised cost if it is held within a business model whose
objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the
financial asset give rise on specified dates to cash flows that are solely payments of principal and interest
on the principal amount outstanding.
b) Financial assets at fair value through other comprehensive income (FVTOCI)
A financial asset is subsequently measured at fair value through other comprehensive income if it is held
within a business model whose objective is achieved by both collecting contractual cash flows and
selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash
flows that are solely payments of principal and interest on the principal amount outstanding.
c) Financial assets at fair value through profit or loss (FVTPL)
A financial asset is measured at fair value through profit and loss unless it is measured at amortized cost
or at fair value through other comprehensive income.
d) Investments in subsidiaries, joint ventures and associates
The Company has adopted to measure investments in subsidiaries, joint ventures and associates at cost
in accordance with Ind AS 27 and carrying amount as per previous GAAP at the date of transition has
been considered as deemed cost in accordance with Ind AS 101.
e) Financial liabilities
Financial liabilities are classified as either financial liabilities at FVTPL or 'other financial liabilities'.
Financial liabilities at FVTPL
Financial liabilities are classified as at FVTPL when the financial liability is held for trading or are
designated upon initial recognition as FVTPL. Gains or Losses on liabilities held for trading are
recognised in the Statement of Profit and Loss.
Other Financial liabilities
Other financial liabilities (including borrowings and trade and other payables) are subsequently
measured at amortised cost using the effective interest method.
For trade and other payables maturing within one year from the balance sheet date, the carrying
amounts approximate fair value due to the short maturity of these instruments.
iii) Derecognition of financial instruments
A financial asset is derecognized when the contractual rights to the cash flows from the financial asset expire
or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109. A financial
liability is derecognized when the obligation specified in the contract is discharged or cancelled or expired.
iv) Fair value measurement of financial instruments
The fair value of financial instruments is determined using the valuation techniques that are appropriate in
the circumstances and for which sufficient data are available to measure fair value, maximising the use of
relevant observable inputs and minimising the use of unobservable inputs.
Based on the three level fair value hierarchy, the methods used to determine the fair value of financial assets
and liabilities include quoted market price, discounted cash flow analysis and valuation certified by the
external valuer.
In case of financial instruments where the carrying amount approximates fair value due to the short maturity
of those instruments, carrying amount is considered as fair value.
2.1 Impairment of Assets
i) Financial Assets
In accordance with Ind AS 109, the company recognizes loss allowances using the expected credit loss (ECL)
model for the financial assets which are not fair valued through profit or loss.
Loss allowance for trade receivables with no significant financing component is measured at an amount
equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to
the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which
case those are measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required to
adjust the loss allowance at the reporting date to the amount that is required to be recognised is recognized as
an impairment gain or loss in statement of profit or loss.
ii) Non-Financial Assets
The carrying amounts of the Company's tangible and intangible assets are reviewed at each reporting date to
determine whether there is any indication of impairment. If any such indication exists, then the asset's
recoverable amount is estimated in order to determine the extent of the impairment loss, if any.
The impairment loss is recognised as an expense in the Statement of Profit and Loss, unless the asset is carried
at revalued amount, in which case any impairment loss of the revalued asset is treated as a revaluation
decrease to the extent a revaluation reserve is available for that asset.
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 (other than a revalued 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, to the extent the amount was previously charged to the
Statement of Profit and Loss. In case of revalued assets, such reversal is not recognised.
2.2 Revenue Recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the
amount can be reliably measured.
a) Revenue is recognised at the fair value of the consideration received or receivable. The amount disclosed as
revenue is exclusive of taxes and duties and net of returns, trade discounts and rebates.
b) Dividend income is accounted for when the right to receive the income is established.
2.3 Interest
Interest income from a financial asset is recognized when it is probable that the economic benefits will be flow to
the company and the amount of income can be measured reliably.
Income from interest is recognized using the effective interest rate (EIR). EIR is the rate that exactly discounts the
estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period,
where appropriate, to the gross carrying amount of the financial asset. When calculating the effective interest
rate, the Company estimates the expected cash flows by considering all the contractual terms of the financial
instrument but does not consider the expected credit losses.
2.4 Income Taxes
Income tax expense comprises current tax and deferred tax. Income tax expense is recognized in net profit in the
statement of profit and loss except to the extent that it relates to items recognized directly in equity or other
comprehensive income, in which case it is also recognized in equity or other comprehensive income respectively.
Current income tax for current and prior periods is recognized at the amount expected to be paid to or recovered
from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the
balance sheet date. Deferred income tax assets and liabilities are recognized for all temporary differences arising
between the tax base of assets and liabilities and their carrying amounts in the financial statements except when
the deferred income tax arises from the initial recognition of an asset or liability in a transaction that is not a
business combination and affects neither accounting nor taxable profit or loss at the time of the transaction.
Deferred tax assets and liabilities are reviewed at each reporting date and are reduced to the extent that it is no
longer probable that the related tax benefit will be realized.
Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been enacted or
substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred
income tax assets and liabilities is recognized as income or expense in the period that includes the enactment or
the substantive enactment date. A deferred income tax asset is recognized to the extent that it is probable that
future taxable profit will be available against which the deductible temporary differences and tax losses can be
utilized. The Company offsets current tax assets and current tax liabilities, where it has a legally enforceable right
to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and
settle the liability simultaneously.
Minimum Alternate Tax credit is recognised as deferred tax asset only when and to the extent there is convincing
evidence that the Company will pay normal income tax during the specified period. Such asset is reviewed at
each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no
longer a convincing evidence to the effect that the Company will pay normal income tax during the specified
period.
2.5 Borrowing Costs
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset
are capitalized as part of the cost of the asset. Other borrowing costs are recognized as an expense in the period in
which they are incurred. Borrowing costs consist of interest and other costs that an entity incurs in connection
with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an
adjustment to the borrowing costs.
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