2. Material accounting policies

(A) Statement of Compliance

The Company’s financial statements have been prepared in compliance with Indian Accounting Standards (the ‘Ind
AS’) notified under Section 133 of the Companies Act, 2013 (the ‘Act’) read with Rule 3 of the Companies (Indian
Accounting Standards) Rules, 2015, as amended and other relevant provisions of the Act. The accounting policies
are applied consistently to all the periods presented in the financial statements.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle
and other criteria as set out in the Division II of Schedule III to the Companies Act, 2013. Based on the nature of
products and the time between acquisition of assets for processing and their realisation in cash and cash
equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current or non¬
current classification of assets and liabilities.

(B) Basis of presentation

The Balance sheet and the Statement of profit and loss are prepared and presented in the format prescribed in the
Division II of Schedule III to the Act. The Statement of Cash Flows has been prepared and presented as per the
requirements of Ind AS 7, Statement of Cash Flows. The disclosure requirements with respect to items in the
Balance sheet and Statement of profit and loss, as prescribed in the Schedule III to the Act, are presented by way
of notes forming part of the financial statements along with the other notes required to be disclosed under the
notified Accounting Standards and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
as amended.

(C) Basis of measurement

The Ind AS financial statements have been prepared on a historical cost convention on accrual basis, except for
the following material items that have been measured at fair value as required by relevant Ind AS:-

i) Certain financial assets and liabilities measured at fair value (refer accounting policy on financial
instruments)

ii) Share based payment transactions

iii) Specify others, if any.

All assets and liabilities have been classified as current or non-current as per the Company’s operating cycle and
other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of services and the time
between the rendering of service and their realization in cash and cash equivalents, the Company has ascertained
its operating cycle as twelve months for the purpose of current and noncurrent classification of assets and liabilities

(D) Use of estimates

The preparation of Ind AS financial statements in conformity with Ind AS requires the Management to make
estimate and assumptions that affect the reported amount of assets and liabilities as at the Balance Sheet date,
reported amount of revenue and expenses for the year and disclosures of contingent liabilities as at the Balance
Sheet date. The estimates and assumptions used in the accompanying Ind AS financial statements are based
upon the Management's evaluation of the relevant facts and circumstances as at the date of the Ind AS financial
statements. Actual results could differ from these estimates. Estimates and underlying assumptions are reviewed
on a periodic basis. Revisions to accounting estimates, if any, are recognized in the year in which the estimates
are revised and in any future years affected.

2.1 Borrowing costs

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

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily
takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the
asset. All other borrowing costs are expensed in the period in which they occur.

2.2 Fair value measurement

The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date.

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. The fair value measurement is based on the presumption
that the transaction to sell the asset or transfer the liability takes place either:

? In the principal market for the asset or liability, or

? In the absence of a principal market, in the most advantageous market for the asset or liability
accessible to the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use
when pricing the asset or liability, assuming the market participants act in their economic best interest.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data
are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of
unobservable inputs. The Company's management determines the policies and procedures for fair value
measurement such as derivative instrument.

A fair value measurement of a non-financial asset takes into account a market participant's ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.

All assets and liabilities for which fair value is measured or disclosed in the Ind AS financial statements are
categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant
to the fair value measurement as a whole:

? Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities

? Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable

? Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable

For the purpose of fair value disclosures, the company has determined classes of assets and liabilities on the
basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as
explained above.

2.3 Revenue Recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and
the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at
the fair value of the consideration received or receivable, taking into account contractually defined terms of
payment and excluding taxes or duties collected on behalf of the government. The company has concluded that
it is the principal in all of its revenue arrangements since it is the primary obligor in all the revenue arrangements
as it has pricing latitude and is also exposed to inventory and credit risks.

The specific recognition criteria described below must also be met before revenue is recognised.

Sale of goods:

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods
have passed to the buyer on delivery of goods. Revenue from the sale of goods is measured at the fair value of
the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates.

Rendering of Services:

Revenue from sale of services is recognised as per terms of the contract with customers when the outcome of
the transactions involving rendering of services can be estimated reliably.

Interest Income:

For all financial instruments measured at amortised cost, interest income is recorded using the effective interest
rate (EIR), which is the rate that exactly discounts the estimated future cash payments or receipts through the
expected life of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the
financial asset. Interest income is included in the other income in the statement of profit and loss.

2.4 Taxes

Tax on income for the current period is determined on the basis of estimated taxable income and tax credits
computed in accordance with the provisions of the relevant tax laws and based on the expected outcome of
assessments / appeals.

(A) Current income tax

Current income tax assets and liabilities are measured at the amount expected to be recovered or paid to the
taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted, at the year end date. Current tax assets and tax liabilities are offset where the entity has
a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle
the liability simultaneously.

(B) Deferred tax

Deferred income tax is provided in full, using the balance sheet approach, on temporary differences arising
between the tax bases of assets and liabilities and their carrying amounts in Ind AS financial statements. Deferred
income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other
than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit
(tax loss). Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially
enacted by the end of the year and are expected to apply when the related deferred income tax asset is realised
or the deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilize those temporary differences and losses.

Management periodically evaluates positions taken in tax returns with respect to situations in which applicable
tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts
expected to be paid to the tax authorities.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate to the same taxation authority.

Current and deferred tax is recognized in statement of profit and loss, except to the extent that it relates to items
recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other
comprehensive income or directly in equity, respectively.

2.5 Impairment of non-financial assets

The Company assesses at each year end whether there is any objective evidence that a non-financial asset or a
group of non-financial assets is impaired. If any such indication exists, the Company estimates the asset's
recoverable amount and the amount of impairment loss.

An impairment loss is calculated as the difference between an asset’s carrying amount and recoverable amount.
Losses are recognized in Statement of Profit and Loss and reflected in an allowance account. When the Company
considers that there are no realistic prospects of recovery of the asset, the relevant amounts are written off. If the
amount of impairment loss subsequently decreases and the decrease can be related objectively to an event
occurring after the impairment was recognised, then the previously recognised impairment loss is reversed
through Statement of Profit and Loss.

The recoverable amount of an asset or cash-generating unit (as defined below) is the greater of its value in use
and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to
their present value using a pre-tax discount rate that reflects current market assessments of the time value of
money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped together into
the smallest group of assets that generates cash inflows from continuing use that are largely independent of the
cash inflows of other assets or groups of assets (the “cash-generating unit”).