The Company has entered into a Power Purchase Agreement ('PPA') with Radiance Ka Sunrise Two Private Limited ('Radiance') to procure 100% of the output of solar energy produced by “Radiance” for the next 25 years. Also pursuant to Share Subscription and Shareholder's agreement, the Company has during the year ended March 31, 2022 acquired 26% stake in 'Radiance' divided into 29,00,000 equity shares of T10 each for a total consideration of T2.90 crore for meeting the regulatory requirement of PPA. As per the agreements entered, in the event of termination of the contracts or completion of the contract term, the Company will receive the investment made by it without any share of profit/loss in associate. Accordingly, the investment amount has been amortised to T1.36 crores to give the effect of fixed return expected out of the investment and remaining amount of T1.54 crores has been classified as prepaid expenses (refer note 6(b)). As the Company has significant influence, the investment has been accounted as an investment in associate as per Ind AS 28 “Investments in associates and joint ventures”.

During the current year, the Company has given a loan amounting to T100.00 crore carrying interest 5.5% p.a. to the ultimate holding Company i.e. APL Apollo Tubes Limited, for meeting the short and long term funding requirements. The loan is repayable upto 15 months in one or more tranches as and when funds are available with APL Apollo Tubes Limited. Closing balance as at March 31, 2022 is T100.00 crore.

(iii) The Company has created a provision for slow moving inventory of stores & spares of ?0.23 crores (March 31, 2021 : ? Nil crores)

(iv) The mode of valuation of inventories has been stated in note 1(ii)(L) of significant accounting policies.

(v) Inventories have been pledged as security towards Company's borrowings from banks.

Note: To the extent of trade receivables, the Company is not exposed to any significant credit risk exposure.

(i) The average credit period on sale of goods is 0-60 days. No interest is charged on the trade receivables for the amount overdue above the credit period.

(ii) Rights, Preferences and restrictions attached to equity shares

The Company has one class of equity shares having a par value of ? 2 each. 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 amounts, in proportion to their shareholding.

) The Board of Directors of Apollo Tricoat Tubes Limited (“Company”) in its meeting held on August 6, 2021 have recommended for approval by shareholders, bonus issue of 1 (one) equity share of ?2 each for every 1 (one) equity share of ?2 each held by shareholders of the Company as on the record date.

Pursuant to the approval of the shareholders through postal ballot (including e-voting), the Company has allotted 3,04,00,000 bonus equity shares of ?2 each as fully paid-up bonus equity shares, in the proportion of 1 (one) equity share of ?2 each for every 1 (one) existing equity shares of ?2 each to the equity shareholders of the Company as on record date of September 18, 2021. Consequently the Company capitalised a sum of ?6.08 crores from other equity.

The earning per share have been adjusted for bonus issue for previous year presented.

Nature and purpose of reserves

(i) Securities premium: Securities premium is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Indian Companies Act, 2013 (“the Companies Act”).

(ii) Retained earnings: It represents unallocated / undistributed profits of the Company. The same is available for distribution.

(iii) Capital reserve: Accumulated capital surplus not available for distribution of dividend and expected to remain invested permanently.

(iv) Items of other comprehensive income: It represents profits / (loss) of the Company which will not be reclassified to statement of profit or loss.

The Board of Directors of Apollo Tricoat Tubes Limited (“Company”), at its meeting on February 27, 2021, had considered and approved a draft scheme of amalgamation ('scheme') of the Company and Shri Lakshmi Metal Udyog Limited ("Shri Lakshmi”) with APL Apollo Tubes Limited (”APL Apollo”), its Holding Company and their respective shareholders and creditors, as may be modified from time to time ('scheme'), under Section 230 to 232 of the Companies Act, 2013. Requisite no objection certificate from BSE Limited, approvals from the shareholders and creditors of the Company have been received. The Scheme is subject to sanction of the Hon'ble NCLT.

As the merger order is effective from April 1, 2021, income tax return for financial year 2021-22 will be filed by APL Apollo Tubes Limited after giving effect of Merger of above three companies. There is no requirement to file separate income tax return for Apollo Tricoat Tubes Limited and hence, APL Apollo Tubes Limited has been discharging obligation towards advance tax of all three above mentioned companies.

33 Allocation of common expenses

(a) During the year, the Company has paid the charges for common expenses incurred by the ultimate holding Company on behalf of the Company. The allocation of common expenses has been carried out on the basis of turnover of respective companies, as per latest audited financial statements.

(b) During the year, the Company has charged back the common expenses incurred by it on behalf of group companies on cost i.e. cost to cost basis. The allocation of common expenses has been carried out on the basis of turnover of respective companies, as per latest audited financial statements.

36 Contingent liabilities and commitments (to the extent not provided for)

(a) Contingent liabilities

Contingent liabilities for the year ended March 31, 2022 is ? Nil (March 31, 2021 is ? Nil)

(b) Commitments

(1) Estimated amount of contracts remaining to be executed on capital account and not provided for

(2) The Company has obtained EPCG (Export Promotion Capital Goods Scheme) licenses for importing the capital goods without payment of basic custom duty against submission of bonds.

The export obligation is to be fulfilled within a period of 6 years from the date of issuance of license. Under this scheme, the Company has to achieve FOB value of exports which will be 6 times of duty saved. Accordingly the Company is required to export goods of FOB Value of ^147.48 crore (March 31, 2021 ^142.30 crore) against which the Company has saved a duty of ^24.58 crore (March 31, 2021 ^23.72 crore).

(3) The Company does not have any other long-term commitments or material non-cancellable contractual commitments / contracts.

37 Employee benefit obligations

(a) General description of the employee benefit plan

The Company has an obligation towards gratuity, unfunded defined benefit retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of the employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months in terms of Gratuity scheme of the Company or as per payment of Gratuity Act, whichever is higher. Vesting occurs upon completion of five years of service.

(b) Defined benefit plans

The Company has an unfunded defined benefit gratuity plan. The gratuity scheme provides for lump sum payment to vested employees at retirement/death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of 6 months subject to a limit of ?0.20 crore. Vesting occurs upon completion of 5 years of service.

In respect of the plan in India, the most recent actuarial valuation of the present value of the defined benefit obligation were carried out as at March 31, 2022 by an actuary. The present value of the defined benefit obligation, and the related current service cost and the past service cost, were measured using the projected unit credit method.

(c) Defined contribution plans

The Company makes Provident Fund contributions which are defined contribution plans, for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised ?0.73 crore (Year ended March 31, 2021 ?0.60 crore) for Provident Fund contributions in the statement of profit and loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation.

(1) The discount rate is based on the prevailing market yield of Indian Government Securities as at Balance Sheet date for the estimated term of obligation.

(2) The estimate of future salary increase considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method i.e. projected unit credit method has been applied as that used for calculating the defined benefit liability recognised in the balance sheet.

(g) Risk exposure

The defined benefit obligations have the undermentioned risk exposures :

Interest rate risk: A decrease in the bond interest rate will increase the plan liability, however, this will be partially offset by an increase in the return on the plan's debt.

Investment risk: The present value of the defined benefit plan liability (denominated in Indian Rupees) is calculated using a discount risk which is determined by reference to market yields at the end of the reporting period on government bonds.

Longetivity risk: The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan's liability.

Demographic risk: This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria. Salary risk: The present value of the defined plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan's liability. No other post-retirement benefits are provided to the employees.

(i) Figures in the bracket relates to previous year ended March 31, 2021.

(ii) Amount of expense of gratuity and compensated absences is taken on actuarial basis.

(iii) The term loan and other credit facilities of the Company are also secured by corporate guarantee of APL Apollo Tubes Limited, ultimate holding Company, personal guarantee of directors of the APL Apollo Tubes Limited, ultimate holding Company, Mr. Sanjay Gupta and Mr. Rahul Gupta (Managing director of Apollo Tricoat Tubes Limited).

(iv) The treasury and finance operations of the Company, its holding company, its ultimate holding company and fellow subsidiaries (APL Group Companies) are managed centrally. Based on the funding requirement, APL group companies provide advance in the nature of loan to each other and these are repaid as and when funds are available with respective company. Also interest is charged for the period on such advance in the nature of loan remains outstanding to ensure arms' length transaction. The above transactions are undertaken with the approval of the Board of Directors and the Audit Committee as applicable. The maximum amount outstanding during the year in respect of advance in the nature of loan given by the Company to its holding Company, its ultimate holding company and fellow subsidiaries are as under:

(a) Valuation technique to determine fair value

Cash and cash equivalents, other bank balances, trade receivables, loans, other current financial assets, trade payables, current borrowings 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 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 values of the lease payments are determined by using discounted cash flow method using the appropriate discount rate. The discount rate is determined using other similar instruments incorporating the risk associated.

(b) Fair value hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for

which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the accounting standard.

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 is determined using valuation techniques which maximise 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 unlisted equity securities, security deposits included in level 3.

(c) Assets and liabilities which are measured at amortised cost for which fair values are disclosed

All the financial asset and financial liabilities measured at amortised cost, carrying value is an approximation of their respective fair value.

40 Financial risk management objectives

The Company's activities expose it to market risk (including foreign currency risk and interest rate risk, liquidity risk and credit risk).

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk :

The Company's risk management is carried out by a treasury department under policies approved by the Board of Directors, The Company treasury department identifies, evaluates financial risks in close co-operation with the Company's operating units. The Board provides principles for overall risk management, as well as policies covering specific areas.

(a) Market risk

Market risk is the risk of any loss in future earnings, in realisable fair values or in future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as result of changes in interest rates, foreign currency exchange rates, equity price fluctuations, liquidity and other market changes. Future specific market movements can not be normally predicted with reasonable accuracy.

(i) Foreign currency risk

The Company's functional currency is Indian Rupees. The Company undertakes transactions denominated in the foreign currencies; consequently, exposure to exchange rate fluctuations arise. Volatility in exchange rates affects the Company's the costs of imports, primarily in relation to capital assets.

The Company has limited exposure to foreign currency risk and thereby it mainly relies on natural hedge. To further mitigate the Company's exposure to foreign currency risk, non-INR cash flows are continuously monitored.

(ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk because funds are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rate. The borrowings of the Company are principally denominated in T with a mix of fixed and floating rates of interest. The Company has exposure to interest rate risk, arising principally on changes in base lending rate and MCLR rates. The Company uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements for its day to day operations. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings.

(b) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial losses to the Company. The Company is exposed to credit risk from its operating activities (primarily trade receivables ) and from its financing activities, including deposits with banks, foreign exchange transactions and other financial instruments. The Company evaluates the credit worthiness of the customers based on publicly available information and the Company's historical experiences. The Company's exposure to its counterparties are continuously reviewed and monitored by the Chief Operating Decision Maker (CODM).

Credit period varies as per the contractual terms with the customers. No interest is generally charged on overdue receivables.

The Company directly reduces the gross carrying amount of a financial asset when the Company has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof.

In respect of trade and other receivables, the Company is not exposed to any significant credit risk exposure to any single counterparty. Trade receivables consist of a large number of customers of various scales and in different geographical areas. Based on historical information about customer default rates, management considers the credit quality of trade receivables. In case the receivables are not recovered even after regular follow up, measures are taken to stop further supplies to the concerned customer. The company recognises lifetime expected credit loss on trade receivables using simplified approach.

Credit risk relating to cash and cash equivalent and restricted cash is considered negligible as counterparties are banks. The management considers the credit quality of deposits with such bank to be good and reviews the banking relationships on an on-going basis.

In the year ended March 31, 2022, revenues arising from sales of products as disclosed in note 25(a) includes revenue of ^917.63 crores from two customers who contributed more than 10% to the Company's revenue.

In the year ended March 31, 2021, revenues arising from sales of products as disclosed in note 25(a) includes revenue of ^302.85 crores from a customer who contributed more than 10% to the Company's revenue.

(c) Liquidity risk

The Company has a liquidity risk management framework for managing its short term, medium term and long term sources of funding vis-a-vis short term and long term utilization requirement. This is monitored through a rolling forecast showing the expected net cash flow, likely availability of cash and cash equivalents, and available undrawn borrowing facilities.

42 Capital management (a) Risk management

The Company being in a capital intensive industry, its objective is to maintain a strong credit rating, healthy capital ratios and establish a capital structure that would maximise the return to stakeholders through optimum mix of debt and equity.

The Company's capital requirement is mainly to fund its capacity expansion, repayment of principal and interest on its borrowing and strategic acquisitions. the principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital market. The Company is not subject to any externally imposed capital requirements.

The Company regularly considers other financing and refinancing opportunities to diversify its debt profile, reduce interest cost and elongate the maturity of its debt portfolio, and closely monitors its judicious allocation amongst competing capital expansion projects and strategic acquisition, tap capture market opportunities at minimum risk.

The Company monitors its capital using gearing ratio, which is net debt divided to total equity. Net debt includes, interest bearing loans and borrowing less cash and cash equivalents, bank balances other than cash and cash equivalents.

Note: There are no projects as on each reporting period where activity has been suspended. Also, there are no projects as on reporting period which has exceeded cost as compared to its original plan or where completion is overdue.

(c) The amount due to Micro and small enterprises as defined in “The Micro, Small and Medium Enterprises Development act, 2006” has been determined to the extent such parties have been identified on the basis of information available with the Company. The disclosures relating to Micro and Small Enterprises are as below:

(d) Corporate social responsibility

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. A CSR committee has been formed by the Company as per the Act. The

Note :-

1. At the year end, the Company has paid, from surplus cash, long term loan to the ultimate holding Company for Rupees 100.00 crore.

2. Revenue growth along with higher efficiency on working capital improvement has resulted improvement in the ratios.

3. Net profit turnover ratio has declined due to change in product mix.

(f) The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

(g) The Company has not been declared a wilful defaulter by any bank or financial institution or consortium thereof in accordance with the guidelines on wilful defaulters issued by the RBI.

(h) There are no proceedings initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

(i) The Company has not traded or invested in crypto currency or virtual currency during the reporting years.

(j) The Company has neither advanced, loaned or invested funds nor received any fund to/from any person or entity for lending or investing or providing guarantee to/on behalf of the ultimate beneficiary during the reporting years.

(k) There is no charge or satisfaction of charge which is yet to be registered with ROC beyond the statutory period.

(l) The Board of Directors of Apollo Tricoat Tubes Limited (“Company”), at its meeting on February 27, 2021, had considered and approved a draft scheme of amalgamation ('scheme') of the Company and Shri Lakshmi Metal Udyog Limited (“Shri Lakshmi”) with APL Apollo Tubes Limited (“APL Apollo”), its Holding Company and their respective shareholders and creditors, as may be modified from time to time ('scheme'), under Section 230 to 232 of the Companies Act, 2013. Requisite no objection certificate from BSE Limited, approvals from the shareholders and creditors of the Company have been received. The Scheme is subject to sanction of the Hon'ble NCLT.

(m) The Company do not have any transaction not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.

(n) All the quarterly statements of current assets (inventories and trade receivables) filed by the Company with banks or financial institutions are in agreement with books of accounts.