2. SIGNIFICANT ACCOUNTING POLICIES
A. STATEMENT OF COMPLIANCE
Standalone Financial Statements have been prepared
in accordance with the accounting principles generally
accepted in India including Indian Accounting Standards (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, (Ind AS Compliant Schedule III), as
applicable to standalone financial statement.
Accordingly, the Company has prepared these Standalone
Financial Statements which comprise the Balance Sheet
as at 31 March, 2025, the Statement of Profit and Loss, the
Statements of Cash Flows and the Statement of Changes in
Equity for the year ended 31 March, 2025, and accounting
policies and other explanatory information (together
hereinafter referred to as "Standalone Financial Statements" or
"financial statements").
These financial statements have been approved by the Board
of Directors in the meeting held on 22nd May 2025.
B. BASIS OF PREPARATION AND PRESENTATION OF
FINANCIAL STATEMENTS
These financial statements have been prepared in accordance
with the accounting policies, set out below and were
consistently applied to all periods presented unless otherwise
stated.
The financial statements have been prepared on a going
concern basis using historical cost convention and on an
accrual method of accounting, except for certain financial
assets and liabilities which are measured at fair value as
explained in the accounting policies below.
Company's financial statements are presented in Indian
Rupees ('), which is also its functional currency.
C. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost, net
of recoverable taxes, trade discount and rebates less
accumulated depreciation and impairment losses, if any.
Such cost includes purchase price, borrowing cost and any
cost directly attributable to bringing the assets to its working
condition for its intended use, net charges on foreign
exchange contracts and adjustments arising from exchange
rate variations attributable to the assets.
Subsequent costs are included in the asset's carrying amount
or recognised as a separate asset, as appropriate, only when
it is probable that future economic benefits associated with
the item will flow to the entity and the cost can be measured
reliably.
Expenses incurred relating to project, net of income earned
during the project development stage prior to its intended
use, are considered as pre - operative expenses and disclosed
under Capital Work - in - Progress.
The gain or loss arising on disposal of an item of property,
plant and equipment is determined as the difference
between sale proceeds and carrying value of such item, and
is recognised in the statement of profit and loss.
Depreciation on property, plant and equipment is provided
using straight line method based on useful life of the assets
as prescribed in Schedule II to the Companies Act, 2013.
D. INVENTORY
Inventories are stated at the lower of cost and net realizable
value except in case of waste and scrap which are valued at
net realizable value.
Cost of raw material includes cost of purchase and other costs
incurred in bringing the inventories to their present location
and condition. Cost of finished goods and work in progress
include cost of direct materials and labour and a proportion
of manufacturing overheads based on the normal operating
capacity but excluding borrowing costs.
E. REVENUE RECOGNITION
The Company recognises revenue when control over the
promised goods or services is transferred to the customer
at an amount that reflects the consideration to which the
Company expects to be entitled in exchange for those goods
or services.
Revenue is adjusted for variable consideration such as
discounts, rebates, refunds, credits, price concessions,
incentives, or other similar items in a contract when they
are highly probable to be provided. The amount of revenue
excludes any amount collected on behalf of third parties.
In contracts where freight is arranged by the Company
and recovered from the customers, the same is treated as a
separate performance obligation and revenue is recognised
when such freight services are rendered.
Interest income from a financial asset is recognised when it is
probable that the economic benefits will flow to the Company
and the amount of income can be measured reliably. Interest
income is accrued on a time basis, using effective interest
rate.
The Company does not expect to have any contracts where
the period between the transfer of the promised goods or
services to the customer and payment by the customer
exceeds one year. As a consequence, the Company does
not adjust any of the transaction prices for the time value of
money.
F. EMPLOYEES' BENEFITS
Employee benefits include provident fund, employee state
insurance scheme, gratuity, compensated absences and
performance incentives.
Retirement benefit costs and termination benefits
Payments to defined contribution retirement benefit plans
are recognised as an expense when employees have rendered
service entitling them to the contributions.
A liability for a termination benefit is recognised at the earlier
of when the entity can no longer withdraw the offer of the
termination benefit and when the entity recognises any
related restructuring costs.
Short-term and other long-term employee benefits
A liability is recognised for benefits accruing to employees in
respect of wages and salaries and annual leave in the year the
related service is rendered at the undiscounted amount of
the benefits expected to be paid in exchange for that service
Liabilities recognised in respect of short-term employee
benefits are measured at the undiscounted amount of the
benefits expected to be paid in exchange for the related
service
Liabilities recognised in respect of other long-term employee
benefits are measured at the present value of the estimated
future cash outflows expected to be made by the Company
in respect of services provided by employees up to the
reporting date.
The cost of the defined benefit plans and the present value
of the defined benefit obligation ('DBO') are based on
actuarial valuation using the projected unit credit method.
An actuarial valuation involves making various assumptions
that may differ from actual developments in the future.
These include the determination of the discount rate, future
salary increases and mortality rates. Due to the complexities
involved in the valuation and its long-term nature, a defined
benefit obligation is highly sensitive to changes in these
assumptions. All assumptions are reviewed at each reporting
date.
G. BORROWING COSTS
Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized as part of the
cost of such assets. A qualifying asset is one that necessarily
takes substantial period of time to get ready for its intended
use. All other borrowing costs are charged to Profit and Loss
account.
H. FOREIGN CURRENCY TRANSACTIONS
The functional currency of the Company is determined on
the basis of the primary economic environment in which it
operates. The functional currency of the Company is Indian
Rupee (').
The transactions in currencies other than the entity's
functional currency (foreign currencies) are recognised
at the rates of exchange prevailing at the dates of the
transactions. At the end of each reporting period, monetary
items denominated in foreign currencies are retranslated at
the rates prevailing at that date. Non-monetary items carried
at fair value that are denominated in foreign currencies are
retranslated at the rates prevailing at the date when the
fair value was determined. Non-monetary items that are
measured in terms of historical cost in a foreign currency are
not retranslated.
Exchange differences on monetary items are recognised in
Statement of Profit and Loss in the period in which they arise.
I. FINANCIAL INSTRUMENTS
1. Financial Assets
I. Initial recognition and measurement
All financial assets are initially recognized at fair value.
Transaction costs that are directly attributable to the
acquisition of financial assets, which are not at fair
value are adjusted through profit or loss on initial
recognition. Purchase and sale of financial assets are
recognised using trade date accounting.
II. Subsequent measurement
i) Financial assets carried at amortised cost
(AC)
A financial asset is 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.
ii) Financial assets at fair value through other
comprehensive income (FVTOCI)
A financial asset is measured at FVTOCI 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.
iii) Financial assets at fair value through profit
or loss (FVTPL)
A financial asset which is not classified in any of
the above categories are measured at FVTPL.
III. Investment in subsidiaries
The Company has accounted for its investments in
subsidiaries at Fair Value.
IV. Impairment of financial assets
The Company assesses on a forward looking basis
the expected credit losses associated with its assets
carried at amortised cost and FVOCI debt instruments.
The impairment methodology applied depends
on whether there has been a significant increase in
credit risk.
2. Financial liabilities
I. Initial recognition and measurement
All financial liabilities are recognized at fair value and
in case of loans, net of directly attributable cost. Fees
of recurring nature are directly recognised in the
Statement of Profit and Loss as finance cost.
II. Subsequent measurement
Financial liabilities are carried at amortized 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.
3. Derivative financial instruments
The Company uses various derivative financial
instruments such as interest rate swaps, currency swaps
and forwards contracts to mitigate the risk of changes in
interest rates, exchange rates. Such derivative financial
instruments are initially recognized at fair value on the
date on which a derivative contract is entered into and are
also subsequently measured at fair value. Derivatives are
carried as financial assets when the fair value is positive
and as financial liabilities when the fair value is negative.
Any gains or losses arising from changes in the fair value
of derivatives are taken directly to Statement of Profit and
Loss.
4. Derecognition of financial instruments
The Company derecognizes a financial asset 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 (or a part of a financial liability) is
derecognized from the Company's Balance Sheet when
the obligation specified in the contract is discharged or
cancelled or expires.
J. LITIGATION
The Company is subject to legal proceedings and claims
which have arisen in the ordinary course of business. The
Company's management does not reasonably expect
that these legal actions when ultimately concluded and
determined will have a material and adverse affect on the
Company's result of operations or financial condition.
K. TAXATION
Income tax expense represents the sum of the tax currently
payable and deferred tax.
Current tax
Current tax is the amount of tax payable based on the taxable
profit for the year as determined in accordance with the
provisions of section 115BAA of the Income Tax Act, 1961.
Deferred tax
Deferred tax is recognized on temporary differences between
the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the
computation of taxable profit.
The carrying amount of deferred tax assets is reviewed at the
end of each reporting period and reduced to the extent that
it is no longer probable that sufficient taxable profits will be
available to allow all or part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates
that are expected to apply in the period in which the liability
is settled or the asset realised, based on tax rates (and tax
laws) that have been enacted or substantively enacted by the
end of the reporting period.
Deferred tax assets and deferred tax liabilities are offset if a
legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred taxes relate to
the same taxable entity and the same taxation authority.
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