9.2 Rights, Preferences and Restrictions attached to equity shares :
The Company has one class of shares having par value of ?10 per share. Each shareholder is eligible for one vote per share held. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. 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. No Shares has been reserved for issue under options or contracts/commitments for the shares/disinvestment.
9.3 In the five years immediately proceeding March 31,2025
The Company had issued 3 equity bonus shares for every 20 equity shares during the Financial Year ended on March 31,2022.
Note: Board of Directors of the Company have proposed final dividend of Rs. 1.50 per equity share of face value of Rs. 10/- each. Proposed dividend on equity shares are subject to approval at the Annual General Meeting and hence not recognized as a liability as at March 31,2025. No interim dividend was declared or paid during the financial year ending March 31,2025.
The description of the nature and purpose of each reserve within equity is as follows:
a. General Reserve
General Reserve is created by transfer of profits from retained earnings for appropriation purposes. General reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income.
b. Securities Premium
Securities premium is created due to premium on issue of shares. These reserve is utilised in accordance with the provisions of the Companies Act.
c. Retained Earning
Retained earnings are the profits that the Company has earned till date, less any transfer to general reserve, dividends or other distributions to shareholders.
Note 11 : Financial Liabilities
Note 26 : Segment Reporting Identification of Segments :
The chief operational decision maker monitors the operating results of its Business segment separately for the purpose of making decision 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 segment have been identified on the basis of nature of products and other quantitative criteria specified in the Ind AS 108. Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (“CODM”) of the Company.
Operating Segments :
The Company's business activity falls within a single operating business segment of Trading of Acids & Chemicals.
Note 27 : Disclosure Pursuant to Employee Benefits A. Defined Benefit Plans:
The Company has following post employment benefit plans which are in the nature of defined benefit plans:
(a) Gratuity (Unfunded)
The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The Gratuity plan is a Unfunded plan administered by the Company.
Liabilities with regard to the Gratuity Plan are determined by actuarial valuation, performed by an independent actuary, at each Balance Sheet date using the projected unit credit method.
The Company recognizes the net obligation of a defined benefit plan in its Balance Sheet as an asset or liability. Gains and losses through remeasurements of the net defined benefit liability/(asset) are recognized in other comprehensive income and are not reclassified to profit or loss in subsequent periods. The actual return of the portfolio of plan assets, in excess of the yields computed by applying the discount rate used to measure the defined benefit obligations recognized in other comprehensive income.
Risks associated to the defined benefit plans:
1. Interest rate risk: A fall in the discount rate which is linked to the G.Sec. Rate will increase the present value of the liability requiring higher provision. A fall in the discount rate generally increases the mark to market value of the assets depending on the duration of asset.
2. Salary Risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of membe? As such, an increase in the salary of the members more than assumed level will increase the plan's liability.
3. Investment Risk: The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. If the return on plan asset is below this rate, it will create a plan deficit. Currently, for the plan in India, it has a relatively balanced mix of investments in government securities, and other debt instruments.
4. Asset Liability Matching Risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of Rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.
5. Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.
6. Concentration Risk: Plan is having a concentration risk as all the assets are invested with the insurance company and a default will wipe out all the assets. Although probability of this is very low as insurance companies have to follow stringent regulatory guidelines.
The above sensitivity analysis may not be representative of the actual 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.
In presenting the above sensitivity analysis, the present value of defined benefit obligation has been calculated using the projected unit credit method at the end of reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognized in the balance sheet. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared with the previous period.
(c) Terms and conditions of transactions with related parties
Transaction entered into with related party are made on terms equivalent to those that prevail in arm’s length transactions. Outstanding balances other than loan given, at the year-end are unsecured and interest free and settlement occurs in cash.
(d) Commitments with related parties
The Company has not provided any commitment to the related party as at March 31,2025 (March 31,2024: Rs. Nil)
The management assessed that the fair values of cash and cash equivalents, other bank balances, loans, trade receivables, other current financial assets, trade payables and other current financial liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
The fair value of the financial assets and liabilities is 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. The following methods and assumptions were used to estimate the fair values.
The fair value of borrowings is calculated by discounting future cash flows using rates currently available for debts on similar terms, credit risk and remaining maturities.
For financial assets and financial liabilities that are measured at fair value, the carrying amounts are equal to the fair values.
(b) Fair value hierarchy
The following table provides the fair value measurement hierarchy of the Company's assets and liabilities.
Fair value hierarchy
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the counter derivatives) is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for There are no transfer between level 1,2 and 3 during the year.
The Company’s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
The Company’s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company’s risk management assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities.
The Company's risk management is carried out by a Treasury department under policies approved by the Board of director The Company's treasury identifies, evaluates and hedges financial risks in close co-operation with the Company's operating units. The board provides written principles for overall risk.
(a) Market risk
Market risk refers to the possibility that changes in the market rates may have impact on the Company’s profits or the value of its holding of financial instruments. The Company is exposed to market risks on account of foreign exchange rates, interest rates, underlying equity prices, liquidity and other market changes. Future specific market movements cannot be normally predicted with reasonable accuracy.
(a1) Interest rate risk
Interest rate risk refers to the possibility that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rate. The Company is exposed to interest rate risk of short-term and long-term floating rate instruments. The Company’s policy is to maintain a balance of fixed and floating interest rate borrowings and the proportion of fixed and floating rate debt is determined by current market interest rates. The borrowings of the Company are principally denominated in Indian Rupees with mix of fixed and floating rates of interest. These exposures are reviewed by appropriate levels of management at regular interval.
The break of Fixed Interest bearing and variable interest bearing financial instruments is as below along with the sensitivity analysis.
(a2) Foreign currency risk
The Company has neither incurred any foreign currency transaction during the year nor it has any outstanding receivable or payable in foreign currency, it doesnot assume any currency risk.
(a3) Price Risk
The Company's exposure to equity securities price risk arises from investments held by the Company and classified in the balance sheet either as fair value through OCI or at fair value through profit or loss.
To manage its price risk arising from investments in equity securities, the Company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the Company. The Company ensures appropriate risk governance framework through appropriate policies and procedures and that risks are identified, measured and managed in accordance with the Company’s policies and risk objectives
(b) Credit risk
Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Financial instruments that are subject to concentrations of credit risk materially consists of trade receivables, investments and derivative financial instruments.
The Company is exposed to credit risk from its operating activities (primarily trade receivables and also from its investing activities including deposits with banks, and other financial instruments) for receivables, cash and cash equivalents, financial guarantees and derivative financial instruments.
All trade receivables are subject to credit risk exposure. The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country, in which the customer operates, also has an influence on credit risk assessment. Credit risk is managed through established policies, controls relating to credit approvals and procedures for continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. Outstanding customer receivables are regularly monitored and any shipments to major customers are generally covered by letters of credit. The company uses a provision matrix to compute the ECL allowance for trade receivables and unbilled revenues. The provision matrix takes into account available external and internal credit risk factors and the company's experience for customers.
Trade receivables are non-interest bearing and are generally on 30 days to 180 days credit term.
(c) 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 objective of liquidity risk management is to maintain sufficient liquidity and ensure that funds are available for use as per requirements. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability Of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, the company's treasury maintains flexibility in funding by maintaining availability under committed credit lines.
The Company generates cash flows from operations to meet its financial obligations, maintains adequate liquid assets in the form of cash & cash equivalents and has undrawn short term line of credits from banks to ensure necessary liquidity. The Company closely monitors its liquidity position and deploys a robust cash management system. Management monitors rolling forecasts of the company's liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows. This is generally carried out at local level in the operating companies of the company in accordance with practice and limits set by the company. These limits vary by location to take into account the liquidity of the market in which the entity operates. In addition, the company's liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.
The Company requires funds both for short-term operational needs as well as for long-term investment programmes mainly in growth projects. The table below summarises the maturity profile of the Company’s financial liabilities based on contractual undiscounted payments:
Note 34 : Capital Management Risk Management
For the purpose of the Company’s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company’s capital management is to ensure that it maintains an efficient capital structure and healthy capital ratios in order to support its business and maximise shareholder value.
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 in the financial covenants of any long term borrowing in the current period.
No changes were made in the objectives, policies or processes for managing capital during the current period.
Note 35 : Code on Social Security, 2020
"The Code on Social Security, 2020 (‘Code’) relating to employee benefits during employment and post-employment benefits received Indian Parliament approval and Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective."
Note 36 : New Accounting Pronouncements to be adopted on or after March 31,2025
There are no standards or interpretations which are notified but not yet effective and that would be expected to have a material impact on the Company in the current or future reporting periods.
Note 37 : Additional Regulatory Disclosures As Per Schedule III Of Companies Act, 2013
Additional Regulatory Information pursuant to Clause 6L of General Instructions for preparation of Balance Sheet as given in Part I of Division II of Schedule III to the Companies Act, 2013, are given hereunder to the extent relevant and other than those given elsewhere in any other notes to the Financial Statements.
a. Utilisation of borrowed funds and share premium
During the year ended March 31,2025 and March 31,2024, the Company has not advanced or loaned or invested funds (either borrowed funds or share premium 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.
Further, during the year ended March 31, 2025 and March 31, 2024, 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.
b. Details of crypto currency or virtual currency
" The Company has not invested or traded in Crypto Currency or Virtual Currency during the year ended March 31,2025 (March 31,2024: Rs. NIL)."
c. Details of benami property held
"No proceedings have been initiated on or are pending against the Company for holding benami property under the Prohibition of Benami Property Transactions Act, 1988 (as amended in 2016) (formerly the Benami Transactions (Prohibition) Act, 1988 (45 of 1988)) and Rules made thereunder during the year ended March 31,2025 (March 31,2024:Rs. NIL)."
d. Willful Defaulter
The Company has not been declared Willful Defaulter by any bank or financial institution or government or any government authority during the year ended March 31,2025 (March 31,2024:Rs. NIL).
e. Undisclosed Income
The Company has not surrendered or disclosed as income any transactions not recorded in the books of accounts in the course of tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act,
1961) during the year ended March 31,2025 (March 31,2024:Rs. NIL).
f. Relationship with struck off companies
The Company does not have any transactions with the companies struck off under section 248 of the Companies Act, 2013 or section 560 of the Companies Act, 1956 during the year ended March 31,2025 (March 31,2024:Rs. NIL).
g. Compliance with number of layers of companies
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.
h. Compliance with approved Scheme(s) of Arrangements
The Company has not entered into any scheme of arrangement.
i. Valuation of property, plant and equipments, right-of-use assets and intangible asset
The Company has not revalued its property, plant and equipments, right-of-use assets and intangible asset during the current or previous year.
j. Quarterly Returns or Statements of Current Assets Filed with Banks
"The Company has Fund-based and Non-fund-based limits of Working Capital from Banks and Financial institutions. For the said facility, the revised submissions made by the Company to its lead bankers based on closure of books of accounts at the year end, the revised quarterly returns or statements comprising stock statements, book debt statements, credit monitoring arrangement reports, statements on ageing analysis of the debtors/other receivables, and other stipulated financial information filed by the Company with such banks or financial institutions are in agreement with the unaudited books of account of the Company of the respective quarters and no material discrepancies have been observed."
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Note 39 : Events occurring after the reporting period
The Company evaluates events and transactions that occur subsequent to the balance sheet date but prior to the approval of financial necessity for recognition and/or reporting of subsequent events and transactions in the financial statements. On April 12, 2025, a majo office of the Company. There were no injuries or loss of life and the safety of all the personnel was ensured. The said incident has an i Machinery and other assets. The Company is adequately insured with the Insurance Company. The Company is unable to make a reliab loss, which would be estimated once the surveyors have completed their assessment. Since this is a nonadjusting subsequent event, above standalone audited financial results.
Note 40 : Regrouped, Recast, Reclassified
Material regroupings: Appropriate adjustments have been made in the statements of assets and liabilities, statement of profit and loss by a reclassification of the corresponding items of income, expenses, assets, liabilities and cash flows in order to bring them in line with of the Company as at March 31,2025.
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