3 (iii). There are no capital work in progress whose completion is overdue or has exceeded its cost compared to its original plan.
3 (iv). The title deeds of the properties are in the name of the company except for the title deed of the factory land at Panasapadu, East Godavari, Andhra Pradesh continued to be in the name of the erstwhile Partnership Firm M/s. Apex Exports which is converted as company under Part IX of the Companies act, 1956 in March, 2012.
3 (v). No proceedings have been initiated or pending against the company, for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 (as amended from time to time) and the rules made thereunder. 3(vi). The company has not revalued its Property, plant & equipment (including Right of Use assets) and intangible assets during the year under report
3(vii). There are no intangible assets under development as at 31st March 2024. (Previous year - Nil)
(b) Terms/ rights attached to equity shares
The Company has issued one class of ordinary shares at par value of Rs.10 per share. Each shareholder is eligible for one vote per share held. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential accounts if any, in proportion to their shareholding.
Collateral Securities:
Equitable mortgage of 17762.80 sq. yds and 56047.2 sq. yds unit land and building at G. Ragampeta at R S No 209/2 and R S no 210/4 G at the factory location in the name of the company.
Factory land and building and plant and machinery situated vide Survey No.214, 271/5, 271/4 at Panasapadu village, Acham-peta Panchayat, Samalkota Mandal and at Tallarevu vide Survey No.389/1 that are taken as principal security for the earlier term loans which were closed but continued as collateral security for the working capital limit.
Personally guaranteed by two directors.
16 (ii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
16 (iii) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.
16 (iv) The Company has obtained borrowings from bank on basis of security of current assets wherein the quarterly returns/ statements of current assets as filed with bank are in agreement with the books.
ii. Post-employment benefit obligation - Gratuity
The company provides gratuity, as per defined benefit retirement plan (“the Gratuity plan”) covering eligible employees. The Gratuity Plan provides a lump-sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee's salary and the tenure of employment with the company. Contributions are invested in a scheme with the Life Insurance Corporation of India as permitted by Indian law.
The plan provides for lumpsum payment after retirement/ super annuation as set out in rules of each fund and includes death and disability benefits.
Liabilities with regard to these defined benefit plans are determined by actuarial valuation, performed by an external actuary, at each balance sheet date using the projected unit credit method. These defined benefit plan expose the company to actuarial risks, such as longevity risk, currency risk, interest rate risk and market risk.
The following tables set out the funded status and the amounts recognized in the company's financial statements as at March 31, 2024 and March 31, 2023:
The Present value of Defined Benefit Obligation for a change of 100 Basis Points from the assumed assumption is given below:
Significant Actuarial Assumptions for the determination of the defined benefit obligation are discount rate, expected salary increase. The sensitivity analysis below, have been determined based on reasonably possible changes of the assumptions occurring at end of the reporting period, while holding all other assumptions constant. For presenting the sensitivities, the present value of the Defined Benefit Obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the Defined Benefit Obligation presented above. There was no change in the methods and assumptions used in the preparation of the Sensitivity Analysis from previous year.
33 (B). Note on Ultimate Beneficiaries
No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
No funds have been received by the Company from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall directly or indirectly, lend
or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Parties (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
33 (C). The Company has not traded or invested in Crypto Currency or Virtual Currency during the financial year.
33 (D). The Company does not have any transactions with companies struck off.
33 (E). The company has not granted any Loans or Advances in the nature of loans to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013,) either severally or jointly with any other person, that are repayable on demand or without specifying any terms or period of repayment.
*The remuneration paid by the Company to its Executive chairman, Managing Director and Whole time Director (hereinafter refer to “Key Managerial Personnel”) for the year ended March 31, 2024 is in excess by Rs.63.57 lakhs, Rs.51.17 Lakhs and Rs.30.07 Lakhs respectively vis-a-vis the limits specified in section 197 of Companies Act, 2013 (‘the Act') read with Schedule V thereto as the Company does not have adequate profits. The Company is in the process of complying with the prescribed statutory requirements to regularize such excess payments, including seeking approval of shareholders, as necessary. Until then, the said excess amount is held in trust by said Key managerial personnel.
35. Previous year figures have been regrouped / reclassified wherever necessary to conform to this year's classification.
36. Capital Management
The Company's financial strategy aims to support its strategic priorities and provide adequate capital to its businesses for growth and creation of sustainable stakeholder value. The company sets the amount of capital required on the basis of annual business and long term operating plans which include capital and other strategic investments. The funding requirements are met through a mixture of equity, internal fund generation and borrowed funds. The company tries to maintain an optimal capital structure to reduce cost of capital and monitors capital on the basis of debt-equity ratio.
38. Disclosure relating to leases As a lessor:
The Company has leased out its property under operating lease for period of 6 years. There are no variable lease payments. The details of income from such leases are disclosed under and Note 23. The Company does not have any risk relating to recovery of residual value of property at the end of leases considering the business requirements and other alternatives.
39. Dislcosure on Government GrantsA. Capital Grants 1. EPCG Grant
Grant recognised in respect of duty waiver on procurement of capital goods under EPCG scheme of Central Government which allows procurement of capital goods including spares for pre production and post production at zero duty subject to an export obligations of 6 times of the duty saved on capital goods procured. The amount of EPCG grant waived during the year is Rs. 20.62 lakhs (PY: 236.34) and unamortized capital grant amount as on March 31, 2024 is Rs.251.87 lakhs (PY: 236.34 ). The company has satisfied the export obligation to an extent of Rs. 5.09 lakhs (PY: NIL) as at the year end. The company is treating this government grant as capital grant and deducts the grant from the carrying amount of the asset. The company expects to meet the export obligations in line with the scheme.
B. Revenue Grants1. Export incentives received
a. Company is entitled for Duty Draw Back on the FOB value of Exports made. The amount received under duty drawback is recognized as income under other operating revenue.
b. Company is entitled for Remission of Duties and Taxes on Exported Products scheme (RoDTEP) which is introduced from January, 2021. The incentive is in the form of grant of Duty Credit Scrip from D.G.F.T. The said Scripts are in turn, encashed by way of sale to importers. The entitlement of scrips for the exports made during the year is recognised as income under other operating revenue.
41. Financial Risk Management
The company's activities expose it to variety of financial risks: market risk, credit risk, interest rate risk and liquidity risk. Within the boundaries of approved Risk Management Policy framework. The Company uses derivative instruments to manage the volatility of financial markets and minimize the adverse impact on its financial performance.
i) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices.
a) Foreign Currency Risk
Foreign currency risk is the risk that the Fair Value or Future Cash Flows of an exposure will fluctuate because of changes in foreign currency rates. Exposures can arise on account of the various assets and liabilities which are denominated in currencies other than Indian Rupee
The following table shows foreign currency exposures in US Dollar on financial instruments at the end of the reporting period.
ii) Credit risk
Credit risk is the risk that a customer or counterparty to a financial instrument fails to perform or pay the amounts due causing financial loss to the company. Credit risk arises from company's activities of dealing in employee loans and advance and receivables from customers. The Company ensure that sales of products are made to customers with appropriate creditworthiness. Credit information is regularly monitored by finance function, with a framework in place to quickly identify and respond to cases of credit deterioration. Credit is extended in business interest in accordance with guidelines and business-specific credit policies that are consistent with such guidelines. Exceptions are managed and approved by appropriate authorities, after due consideration of the counterparty's credentials and financial capacity, trade practices and prevailing business and economic conditions.
The company has a prudent and conservative process for managing its credit risk arising in the course of its business activities. Credit risk is actively managed through Letters of Credit, Bank Guarantees and advance payments to the company to avoid concentration of risk.
The Company's historical experience of collecting receivables and the level of default indicate that credit risk is low and generally uniform across markets; consequently, trade receivables are considered to be a single class of financial assets. All overdue customer balances are evaluated taking into account the age of the dues, specific credit circumstances, the track record of the counterparty etc. Loss allowances and impairment is recognized, where considered appropriate by management.
iii) Liquidity risk
Liquidity risk arises from the Company's inability to meet its cash flow commitments on the due date. The company maintains sufficient stock of cash and committed credit facilities. Treasury monitors rolling forecasts of the company's cash flow position and ensures that the company is able to meet its financial obligation at all times including contingencies.
The company's liquidity is managed centrally with operating units forecasting their cash and liquidity requirements. Treasury pools the cash surpluses from across the different operating units and then arranges to either fund the net deficit or invest the net surplus in a range of short-dated, secure and liquid instruments.
43. Distributions proposed
Final dividend on equity shares( FV of Rs. 10 each) of Rs.2 (PY Rs.2.5 ) Per share amounting to Rs.625.00 Lakhs (PY Rs. 781.25 Lakhs) has been proposed by the board of directors.
Proposed dividend on equity shares is subject to approval at the ensuing Annual General Meeting and are not recognised as a liability as at 31 March 2024.
44. The financial statements were approved for issue in accordance with a resolution of the board of directors on 24 th May 2024.
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