ii) Provision for obsolete/ old inventories is made, wherever required.
iii) In view of substantially large number of items in work- in- progress, it is not feasible to maintain the
status of movement of each item at shop floor on perpetual basis. The Company, however, physically
verifies such stocks at the end of the year and valuation is made on the basis of such physical verification.
9a' Write downs of inventories (net of reversal) related to old stock of finished goods amounted to Rs 138.59
(Previous year Nil). It is recognised as expense during the year and included in Changes in inventories of
finished goods, stock-in-trade and work-in-progress in statement of profit and loss.
9b' Inventories are hypothecated to secure borrowings. Refer to Note No. 21.
'10' Trade Receivables
Accounting Policy
Trade receivables are amounts due from customers for goods sold or services performed in the ordinary
course of business. If the receivable is expected to be collected within a period of 12 months or less from the
reporting date (or in the normal operating cycle of the business, if longer), they are classified as current
assets otherwise as non-current assets. Trade receivables are measured at their transaction price unless it
contains a significant financing component.
'14' Current Tax Assets (Net)
Accounting Policy:
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and
any adjustment to the tax payable or receivable in respect of previous years. It is measured using tax rates
enacted or substantively enacted at the reporting date. Current tax assets and liabilities are offset only if, the
Company:
a) Has a legally enforceable right to set off the recognised amounts; and
b) Intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Nature and purpose of other reserves/ other equity
Securities Premium represents the amount received in excess of par value of equity share and can be utilized in
accordance with the provisions of the Companies Act, 2013.
General Reserve represents appropriation of a portion to general reserves out of the profits voluntarily to meet
future contingencies. The said reserve is available for payment of dividend to shareholders as per the provisions
of the Companies Act, 2013.
Capital reserve represents forfeited amount of Equity Share Capital and can be utilised in accordance with the
provision of the Companies Act 2013
Retained Earnings represents profits earned by the Company after transfer to general reserve and payment of
dividend to shareholders.
'18' Lease Liabilities
Accounting Policy:
The lease payments that are not paid at the commencement date are discounted using the interest rate
implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the
Company, the lessee's incremental borrowing rate is used, being the rate that the individual lessee would
have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a
similar economic environment with similar terms, security and conditions.
Lease payments included in the measurement of the lease liability comprise:
• Fixed lease payments (including in-substance fixed payments) payable during the lease term
and under reasonably certain extension options, less any lease incentives;
• Variable lease payments that depend on an index or rate, initially measured using the index or rate at
the commencement date;
• The amount expected to be payable by the lessee under residual value guarantees;
• The exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and
• Payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to
terminate the lease.
The lease liability is presented as a separate line in the Balance Sheet.
The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease
liability (using the effective interest method) and by reducing the carrying amount to reflect the lease
payments made.
The Company re measures the lease liability (and makes a corresponding adjustment to the related right-of-
use asset) whenever:
• The lease term has changed or there is a change in the assessment of exercise of a purchase option, in
which case the lease liability is re measured by discounting the revised lease payments using a revised
discount rate.
• A lease contract is modified and the lease modification is not accounted for as a separate lease, in which
case the lease liability is re measured by discounting the revised lease payments using a revised discount
rate.
'19' Non-Current Provisions
Accounting Policy:
Provisions are recognized when there is a present obligation (legal or constructive) as a result of a past event
and it is probable that it is required to settle the obligation, and a reliable estimate can be made of the
amount of the obligation. The amount recognised as a provision is the best estimate of the consideration
required to settle the present obligation at the balance sheet date, taking into account the risks and
uncertainties surrounding the obligation.
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the
balance sheet and the corresponding tax bases used in the computation of taxable profit. Deferred tax
liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally
recognised for all deductible temporary differences to the extent that it is probable that taxable profits will
be available against which those deductible temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent
that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to
be recovered. Unrecognized deferred tax assets are reassessed at each reporting date and recognised to the
extent that it has become probable that future taxable profits will be available against which they can be
used.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in
which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted
or substantively enacted by the balance sheet date. The measurement of deferred tax liabilities and assets
reflects the tax consequences that would follow from the manner in which the Company expects, at the
reporting date, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax
assets against current tax liabilities and when they relate to income taxes levied by the same taxation
authority and the Company intends to settle its current tax assets and liabilities on a net basis.
Securities: -
Primary: Exclusive Hypothecation 1st charge on the entire current assets of company (both present & future)
comprising stock of raw materials, stock in process, finished goods, stores, receivables etc. including the
goods in transit and all other miscellaneous current assets, and receivables at all units of the Company and
Bills drawn by the company and submitted to the Bank for discounting.
Collateral:
i) Exclusive 1st charge by way of Hypothecation of entire moveable fixed assets of the borrower including
plant and machineries, equipment, vehicles, and other moveable fixed assets both present and future
of the Company at Guna and Baddi units.
ii) Exclusive 1st equitable mortgage charge over land and building in the name of the company situated at
Guna, Madhya Pradesh and Baddi, Himachal Pradesh
Cash Credits is repayable on demand and carry an interest rate of 1.30% above MCLR (Linked to 6 months
MCLR) which is 8.90% p.a. Effective rate being 10.20% p.a. as per the Sanction Letter.
and loss pass to the customer and the Company has the present right to payment, all of which occurs at
a point in time upon shipment or delivery of the product. The Company considers shipping and handling
activities as costs to fulfil the promise to transfer the related products and the customer payments for
shipping and handling costs are recorded as a component of revenue.
Performance Obligation is achieved when:
i) the Company has transferred to the buyer the significant risks and rewards of ownership of the
goods;
ii) the Company retains neither continuing managerial involvement to the degree usually associated
with ownership nor effective control over the goods sold;
iii) the amount of revenue can be measured reliably;
iv) it is probable that the economic benefits associated with the transaction will flow to the Company;
and
v) the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price
(net of variable consideration) allocated to that performance obligation. The transaction price of goods
sold and services rendered is net of variable consideration on account of various discounts and schemes
offered by the Company as part of the contract. Shipping and handling amounts invoiced to customers
are included in revenue and the related shipping and handling costs incurred are included in freight and
forwarding expenses when the Company is acting as principal in the shipping and handling arrangement.
No element of significant financing is deemed present as the sales are made with a credit term, which is
consistent with market practice. Sales exclude Goods and Service Tax.
b) Revenue (other than sale) 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. Export incentives and subsidies are
recognized when there is reasonable assurance that the Company will comply with the conditions and
the incentive will be received.
'36' Current Tax
Accounting Policy:
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year
and any adjustment to the tax payable or receivable in respect of previous years. It is measured using tax
rates enacted or substantively enacted at the reporting date. Current tax assets and liabilities are offset
only if, the Company:
a) Has a legally enforceable right to set off the recognised amounts; and
b) Intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
'37' Earnings per share
Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity
shareholders by the weighted average number of equities shares outstanding during the year. The weighted
average number of equities shares outstanding during the period is adjusted for events such as bonus issue,
bonus element in a rights issue, share split, and reverse share split (consolidation of shares) that have
changed the number of equities shares outstanding, without a corresponding change in resources. For the
purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity
shareholders and the weighted average number of shares outstanding during the period are adjusted for the
effects of all dilutive potential equity shares.
(E) The Company has also recognize expenses of short-term leases on a straight-line basis over the lease term.
The expenses related to short-term leases are Rs.60.43 Lakhs for the year ended March 31, 2025 (Previous
year ? 64.31 Lakhs).
(F) During the financial year ended March 31, 2025, the Company terminated a lease arrangement on 31st
January, 2025, related to Lease Property (Building), originally contracted for a period ending 30.09.27.
As on termination date:
The net carrying amount of Right-of-Use (ROU) asset and the corresponding lease liability is derecognized.
As a result, a net gain of Rs. 27.94 is recognized in the Statement of Profit and Loss under 'Other Income'.
41 Employee benefits
The Company contributes to the following post-employment defined benefit plans in India.
(i) Defined Contribution Plans:
The Company makes contributions towards provident fund to a defined contribution retirement benefit plan
for qualifying employees. Under the plan, the Company is required to contribute a specified percentage of
payroll cost to the retirement benefit plan to fund the benefits. During the year the Company has contributed
to Government Provident Fund Rs.513.15 (Previous year Rs. 512.71).
(ii) Defined Benefit Plan:
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 subject to maximum limit of
Rs. 20 Lakhs. Gratuity liability is being contributed to the Group Gratuity-cum-Life Assurance Cash
Accumulation Policy administered by the LIC of India.
The most recent actuarial valuation of plan assets and the present value of the defined benefit obligation for
gratuity were carried out as at 31st March, 2025. The present value of the defined benefit obligations and
the related current service cost and past service cost, were measured using the Projected Unit Credit
Method.
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed
equity instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity
instruments (including bonds) 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.
There are no transfers between level 1 and level 2 during the year.
Risk management framework
The Company's board of directors has overall responsibility for the establishment and oversight of the
Company's risk management framework. The board of directors has established the processes to ensure that
executive management controls risks through the mechanism of property defined framework.
The Company's risk management policies are established to identify and analyze the risks faced by the
Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk
management policies and systems are reviewed by the board annually to reflect changes in market
conditions and the Company's activities. The Company, through its training and management standards and
procedures, aims to maintain a disciplined and constructive control environment in which all employees
understand their roles and obligations.
The Company's Audit Committee oversees compliance with the Company's risk management policies and
procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by
the Company. The Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit
undertakes regular reviews of risk management controls and procedures, the results of which are reported
to the Audit Committee.
i. 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.
The carrying amount of financial assets represents the maximum credit exposure. The Company monitor
credit risk very closely both in domestic and export market. The Management impact analysis shows credit
risk and impact assessment as low.
Trade and other receivables
The Company's exposure to credit risk is influenced mainly by the individual characteristics of each customer.
However, management also considers the factors that may influence the credit risk of its customer base,
including the default risk of the industry and country in which customers operate.
The Company management has established a credit policy under which each new customer is analyzed
individually for creditworthiness as per the Company's standard payment and delivery terms and conditions.
The Company's review includes market check, industry feedback, past financials and external ratings, if they
are available. Sale limits are established for each customer and reviewed periodically.
More than 60 % of the Company's customers have been transacting with the Company for over four years.
In monitoring customer credit risk, customers are reviewed according to their credit characteristics, including
whether they are an individual or a legal entity, their geographic location, industry and existence of previous
financial difficulties.
In case of trade receivables, the Company follows the simplified approach permitted by Ind AS 109 Financial
Instruments for recognition of impairment loss allowance. The application of simplified approach does not
require the Company to track changes in credit risk. The Company calculates the expected credit losses on
trade receivables using a provision matrix on the basis of its historical credit loss experience.
The carrying amount net of credit loss allowances of trade receivables is Rs. 3604.83 (31st March, 2024 - Rs.
2773.20)
ii. Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with
its financial liabilities that are settled by delivering cash or another financial asset. The Company's approach
to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities
when they are fallen due, under both normal and stressed conditions, without incurring unacceptable losses
or risking damage to the Company's reputation
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, Company
treasury maintains flexibility in funding by maintaining availability under committed credit lines.
Management monitors rolling forecasts of the Company's liquidity position (comprising the undrawn
borrowing facilities) and cash and cash equivalents on the basis of expected future cash flows. This is
generally carried out at unit level and monitored through caproate office of the Company in accordance with
practice and limits set by the Company. These limits vary by location to take into account requirement, future
cash flow and the liquidity in which the entity operates. In addition, the Company's liquidity management
strategy 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.
Provision against disputed Statutory dues not considered above as outflow depends upon conclusion of legal
proceedings
The inflows/(outflows) disclosed in the above table represent the contractual undiscounted cash flows
relating to financial liabilities held for liquidity / credit management purposes and which are not usually
closed out before contractual maturity.
The interest payments on variable interest rate loans in the table above reflect market forward interest rates
at the reporting date and these amounts may change as market interest rates change.
iii. Market risk
Market risk is the risk that changes in market prices - such as foreign exchange rates and interest rates - will
affect the Company's income or the value of its holdings of financial instruments. The objective of market
risk management is to manage and control market risk exposures within acceptable parameters, while
optimizing the return.
The Company generally uses derivatives like forward contracts to manage market risks on account of foreign
exchange. All such transactions are carried out within the guidelines set by the Board of Directors.
in (a). currency risK
The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily with
respect to the USD and small exposure in EUR and GBP. Foreign exchange risk arises from future commercial
transactions and recognised assets and liabilities denominated in a currency that is not the company's
functional currency (INR). The risk is measured through a forecast of highly probable foreign currency cash
flows. The objective of the hedges is to minimize the volatility of the INR cash flows of highly probable
forecast transactions by hedging the foreign exchange inflows on regular basis.
Currency risks related to the principal amounts of the Company's foreign currency payables, if any, are
partially hedged using forward contracts taken by the Company.
In respect of other monetary assets and liabilities denominated in foreign currencies, the Company's policy
is to ensure that its net exposure is kept to an acceptable level by buying or selling foreign currencies at spot
rates when necessary to address short-term imbalances.
iii. (b) Interest rate risk
The Company's main interest rate risk arises from long-term borrowings with variable rates, which expose
the Company to cash flow interest rate risk. During 31st March, 2025 and 31st March, 2024, the Company's
borrowings at variable rate were denominated in Indian Rupees and US Dollars.
Currently the Company's borrowings are within acceptable risk levels, as determined by the management,
hence the Company has not taken any hedge to mitigate the interest rate risk and movement in foreign
currency.
Exposure to interest rate risk
The interest rate profile of the Company's interest-bearing financial instrument is as follows
45 Balances of certain trade receivables and trade payables are in the process of confirmation and/or
reconciliation.
46 Segment Reporting
According to Ind AS 108, identification of operating segments is based on Chief Operating Decision Maker
(CODM) approach for making decisions about allocating resources to the segment and assessing its
performance. The business activity of the company falls within one broad business segment viz. "Textile" and
substantially sale of the product is within the country. The Gross income and profit from the other segment
is below the norms prescribed in Ind AS 108. Hence, the disclosure requirement of Ind AS 108 of 'Segment
Reporting' is not considered applicable.
Two customers individually account (one customer in prev. year) for more than 10% of the revenue in the
year ended 31st March, 2025 and 31st March, 2024.
47 Capital management
The Company's policy is to maintain a strong capital base so as to maintain investor, creditor and market
confidence and to sustain future development of the business. Management monitors the return on capital
as well as the level of dividends to ordinary shareholders. The following table summarises the capital of the
Company:
As the company's net worth or turnover or net profit criteria for applicability of Corporate Social
Responsibility (CSR) under section 135(1) is below the threshold limit in the preceding financial year i.e.,
2023-24, therefore the company is not statutorily required to incur any expenditure under section 135(5) of
the Companies Act, 2013 relating to Corporate Social Responsibility (CSR). However, the company has
voluntarily incurred expenditure amounting to Rs. 70.92 lakh towards CSR activities during the year.
49 Dividend
The Board of directors in their meeting held on 22nd May, 2025, have not recommended any dividend.
For the previous year, the Board of directors in their meeting held on 29th May, 2024 have recommended
dividend of Rs. 0.50 per equity share aggregating Rs. 39.95 Lakhs for the financial year ended March 31,
2024. The same has been approved by the shareholders in the Annual General Meeting held on 30th August,
2024 and is accounted in the current financial year 2024-25.
50 The figures for the previous periods have been regrouped/rearranged, wherever considered necessary, to
conform current year classifications.
The accompanying notes are an integral part of the fina ncial statements
As per our report of even date attached.
For Salarpuria & Partners Yashwant Kumar Daga Gajendra Singh Rathore
Chartered Accountants Chairman and Managing Director Chief Finan cial Officer
Firm Reg. No. 302113E DIN: 00040632
Anand Prakash Shounak Mitra Puneeta Arora
Partner Director Company Secretary
Membership No. 056485 DIN: 07762047 FCS:7466
Place: Kolkata
Date: 22nd May, 2025
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