16(d)The Board of Directors at its meeting held on 6th February, 2023 approved the sub division of its Equity shares of face value ' 10 each into Equity shares of face value ' 5 each. The said sub division was further approved by the Share holder through Postal Ballot on 16th March, 2023. The Company had fixed 10th April, 2023 as the record date for the purpose of sub-division of the Equity Shares. The Basic and Diluted EPS for the prior periods of standalone and the consolidated financial statements have been restated considering the face value of ' 5 each on accordance with IND AS 33-”Earning per share: Refer note no 32.
16(e) The Company has only one class of equity shares having par value of Rs. 5 per share. Each holder of equity shares is entitled to one vote per share. The dividend if proposed by the Board of Directors is subject to approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company the holders of the equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
16(f) There are no shares issued pursuant to contract without payment being received in cash, allotted as fully paid up by way of bonus shares and bought back during the last 5 years.
17(b) Securities Premium Reserve is used to record the premium on issue of shares. The reserve shall be utilized in accordance with the provision of the Companies Act, 2013.
17(c) Capital Reserve is a non distributable reserve.
17(d) Retained Earnings amount that can be distributed as dividend considering the requirements of Companies Act,2013. For the year ended March 31,2024, the Board of Directors has recommended a final dividend of ' 2.44 Per share, subject to approval from Shareholders at the Annual General Meeting and if approved, would result in a cash outflow of ' 1,561.60 Lakhs (March 31,2023 ' 1,184 Lakhs).
On account of Scheme of Arrangement apporved by Hon'able NCLT, the Company recongized “Goodwill” in the books of account. On the said Goodwill, the Company was claiming amortisation in the books of account and depreciation in the Tax Laws while filling return of income for assessment year upto 2020-21. Now, with the amendment brought in by Finance Bill, 2021 on prospective basis, no depreciation would be allowable on goodwill on April,2020 (Assessment Year 2021-22 onwards). As per change, Goodwill of a business or profession will not be considered as a depreciable asset and there would not be any depreciation on goodwill of a business or profession on any situation. Accordingly, the Company is required to reverse majority of its deferred tax liability created in earlier years (i.e. demerger effective from 1st April, 2017) and bring its deferred tax provision at par with requirement of the law.
34 - SEGMENT REPORTING
As per para 4 of Ind AS 108 “ Operating Segments”, if a single financial report contains both Consolidated Financial Statements and the separate financial statement of the Parent Company, segment information may be presented on the basis of the Consolidated Financial Statement. Thus, the information related to disclosure of operating segments required under Ind AS 108 “ Operating Segments”, is given in Consolidated Financial Statements.
35 - Employee Benefit Plans
In accordance with the stipulations of the Indian Accounting Standard 19 “Employee Benefits”, the disclosures of employee benefits as defined in the Indian Accounting Standard are given below:
(a) Defined contribution plans
- Provident fund
The Company has recognized the following amounts in the statement of Profit and Loss :
Employers’ contribution to provident fund
The Company has recognized an amount of ' 38.24 Lakhs (P.Y. ' 48.31 Lakhs) as expenses under the defined contribution plan in the Statement of Profit and Loss.
(b) Defined benefit plans - Gratuity
In accordance with Indian Accounting Standard 19, Actuarial valuation was done in respect of the aforesaid defined benefit plans based on the following assumptions:
The following table sets out the status of the gratuity and the amounts recognized in the Company's financial statements as at 31st March 2024.
Financial Assumptions
The discount rate and salary increases assumed are the key financial assumptions and should be considered together, It is the difference or ‘gap' between these rates which is more important than the Individual rates in isolation.
Discount Rate
The rate used to discount other long term employee benefit obligation (both funded and unfunded) shall be determined by reference to market yield at the Balance date on high quality corporate bonds. In Countries where there is no deep market in such bonds the market yields (at the Balance sheet date) on government bonds shall be used. The currency and term of the corporate bond or government bond shall be consistent with estimated term of the post employment benefit obligation.
Salary Escalation Rate
This is Management's estimate of the increases in the salaries of the employees over the long term. Estimated future salary increases should take account of inflation ,seniority, promotion an other relevant factors such as supply and demand in the employment market.
The sensitivity analysis presented above may not be representative of the actual change in the defined 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. Further more, in presenting the above senitivity analysis the present value of the defined benefit obligations has been calculated using the projected unit credit method at the end of the reporting preiod, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.
36 - Expenditure towards Corporate Social Responsibility (CSR) activities:
In accordance with the provisions of Section 135 of the Companies Act,2013, Schedule VII and Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended,the Board of Directors of the Company had constituted a Corporate Social Responsibility (CSR) Committee. In terms of the provisions of the said ACt, the Company was required to spend of ' 114.78 lakhs (previous year ' 99.12 lakhs) towards CSR activities during the year ended 31st March, 2024. The Company has incurred following expenditure towards CSR activities for the benefit of general public andin the neighborhood of the Company.
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i) The above related party transactions have been reviewed periodically by the Board of Directors of the Company vis-a-vis the applicable provisions of the Companies Act, 2013 and justification of the rates being charged/terms thereof and approved the same.
ii) The details of guarantees and collaterals extended by the related parties in respect of borrowings of the Company have been given at the respective notes.
iii) Entity under common control are disclosed only with whom transaction has taken place during the year.
iv) All related party transaction have been taken at arm's length price..
41. FINANCIAL RISK MANAGEMENT OBJECTIVES
The Company's Risk Management framework encompasses practices relating to the indentification, analysis, evaluation, treatment mitigation and monitoring of the strategic,external and operational controls risks to achieving the Company's business objectives. It seeks to minimize the adverse impact of these risks, thus enabling the Company to leverage market opportunities effectively and enhance its long term competitive advantage.The focus of risk management is to assess risks and deploy mitigation measures.
The Company's activities expose it to variety of financial risks namely market risk, credit risk and liquadity risk.The Company has various financial assets such as deposits, other receivables and cash and bank balances directly related to the business operations. The Company's principal financial liabilities comprise of trade and other payables. The Company's senior management's focus is to foresee the unpredictability and minimize potential adverse effects on the Company's financial performance. The Company's overall risk management procedures to minimize the potential adverse effects of financial market on the Company's performance are outlined here under :
The Company's Board of Directors have overall responsibility for the establishment and oversight of the Company's risk management framework.
The Company's risk management is carried out by the management in consultation with the Board of Directors. They provide principles for overall risk management, as well as policies covering specific risk areas.
The note explains the sources of risk which the entity is exposed to and how the entity manages the risk.
(A) Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Company's receivables from customers and from its financial activities including deposits with banks and other financial instruments.
(i) Cash and cash equivalents:
The Company considers factors such as track record, size of institution, market reputation and service standard to select the banks with which deposits are maintained. The Company does not maintain significant deposit balances other than those required for its day to day operations. Credit risk on cash and cash equivalents is limited as these are generally held or invested in deposits with banks and financial institutions with good credit ratings
(ii) Financial Assets :
The Company's customer profile include Government Companies and Industries. Accordingly, the Company's customer credit risk is moderate. The Company has a detailed review mechanism of overdue customer receivables at various levels within organization to ensure proper attention and focus for realization.
(B) Liquidity Risk
Liquidity risk is the risk that the Company will face in meeting its obligation associated with the financial liabilities.The Company's approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses. In doing this, management considers both normal and stressed conditions.
The Company's objective is to maintain optimum levels of liquidity to meet its cash and collateral requirements.The Company relies on a mix of borrowings, capital and excess operating cash flow to meet its needs for funds.The current Committed lines of credit are sufficient to meet its short to medium term expansion needs. The Company monitors rolling forecasts of its liquidity requirements to ensure that it has sufficient cash to meet operational needs.
The table below provides undiscounted cash flows towards non derivative financial assets/(liabilities) into relevant maturity based on the remaining period at the balance sheet date to the contractual maturity date and where applicable, their effective interest rates.
(C) Market risk
Market risk is the risk that the fair value fo future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risks: Foreign currency risk, interest risk and other price risk such as commodity risk.
(i) Interest rate risk
The Company's exposure to the risk of changes in market interest rates relates primarily to debts having floating rate of interest. Its objective in managing its interest rate risk is to ensure that it always maintains sufficient head room to cover interest payment from anticipated cash flows which are regularly reviewed by the Board.
(ii) 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 exchange rates and arises where transactions are done in foreign currencies. It arises mainly where receivables and payable exist due to transactions entered in foreign currencies. The Company evaluates exchange rate exposure arising from foreign currency transactions and follow approved policy parameters utilizing forward foreign exchange contracts whenever felt necessary. The Company does not enter into financial instrument transactions for trading or speculative purpose.
(iii) Commodity Risk:
The Company is exposed to the movement in the price of key raw materials and other traded goods in the domestic and international markets. The Company has in place policies to manage exposure to fluctuation in prices of key raw material used in operations.The Company enters into contracts for procurement of raw materials and traded Goods, most of the transactions are short term fixed price contracts and a few transactions are long term fixed price contracts.
(D) Capital management
The Company manages its capital to be able to continue as as going concern while maximizing the returns to shareholders through optimization of the debt and equity balances. For the purpose of calculating gearing ratio, debt is defined as non current and current borrowings (excluding derivatives). Equity includes all capital and reserves of the Company attributable to equity holders of the Company. The Company is not subject to externally imposed capital requirements. The board review the capital structure and cost of capital on an annual basis but has not set specific targets for gearing ratios. The risks associated with each class of capital are also considered as part of the risk reviews presented to the Board of Directors.
43. Relationship with Struck off Companies
The Company has not carried out any transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of the Companies Act, 1956. There is no outstanding balance as at 31st March 2024 in case of said struck off company.
44. Balances of Other Current Liabilities, Trade Receivables and Trade Payables are subject to confirmation, reconciliation and adjustments if any.
45 In the opinion of the Management, current assets have a value on realization in the ordinary course of business at least equal to the amount at which they are stated except where indicated otherwise.
46 Previous period figures have been regrouped, re-classified and re-arranged wherever considered necessary to confirm to the current year's classification.
47 The MCA wide notification dated March 24,2021 has amended Schedule III to the Companies Act,2013 in respect of certain disclosures. The Company has incorporated appropriate changes in the above results.
48 Additional information as required under para 2 of General Instruction of Division II of Scheulde III to the Companies Act, 2013
(48a) The Company has not carried out any revaluation of Property, Plant and Equipment in any of the period reported in the Financial Statement hence reporting is not applicable.
(48b) The Company does not have hold any benami property as defined under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder. No proceeding has been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.
(48c) As per sanctioned letter issued by Banks, the Company is required to submit Stock statement to Banks on quarterly basis. As per comparison made of the stock statement vis-a-vis books of account,there are no material difference noted.
(48d) The Company does not have any charges or satisfaction, which is yet to be registered with ROC beyond the statutory period.
(48e) The Company does not have any such transaction which is 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 (Such as search or survey or any other relevant provisions of the Income Tax Act,1961).
(48f) The Company has not advanced or loaned or invested funds to any other person(s) pr entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
(a) Directly or indirectly lend or invest in other persons or entities indentified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or
(b) Provide any guarantee,security or the like to or on behalf of the Ultimate Beneficiaries.
(48g) During FY 2023-24, the Company has not raised any amount from issue of securities. The borrowed funds have been utilized for the specific purpose for which the funds were raised.
(48h) The Company has not traded or invested in crypto currency or virtual currency during the financial year.
(48i) The Company is in compliance with the number of layers prescribed under clause (87) of section 2 of the Companies Act read with the Companies (Restriction on number of Layers) Rules, 2017.
49 The Standalone Financial Statements for the year ended March 31, 2024 have been received by the Audit Committee and approved by the Board of Directors at their meeting held on 15th May 2024.
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