General Reserve:

General reserve is created by the Company by appropriating the balance of Retained Earnings. It is a free reserve which can be used for meeting future contingencies, creating working capital for business operations, strengthening the financial position of the company.

Retained earnings:

Retained earning are the profits that the Company has earned till date, less any transfers to general reserve, dividends or other distributions paid to shareholders. (Refer statement of changes in equity.)

28.1. The Company has fulfilled export obligations (FIBC Bags Division), net foreign exchange earnings and other conditions, as applicable till date, in terms of schemes of Government of India, for 100% EOU.

Note: Mark to market loss of Rs. 4.24 Lakhs on outstanding forward contract as on 31^st March 2024 has been recognized in other comprehensive income as per IND AS 109 on accounting of cash flow hedge.

As per requirements of IND AS 33, the Basic and Diluted earnings per share for all the periods presented have been computed on 1,00,00,000 Equity Shares of Rs. 5/- each.

29. Financial Risk Management

The Company's principle financial liabilities comprise of borrowings, trade and other payables. The main purpose of these financial liabilities is to manage finances for the Company's operations. The Company's principle financlial assets include loans and advances, trade receivables and cash and bank balances that arise directly from its operations.

The Company also enters into derivative transaction to hedge foreign currency and not for speculative purposes. The Company is exposed to Market Risk, Credit Risk and Liquidity Risk and the Company's Senior Management oversees the management of these risks.

29.1. Market Risk

Market Risk is the risk that the fair value of future cash flows of a financial asset will fluctuate because of changes in market prices. The Company's activities expose it to a variety of financial risks, including the effect of changes in foreign currency exchange rates and interest rates.

29.1. (a). Currency Risk

Foreign Currency risk is the risk that fair value of future cash flow of an exposure will fluctuate because of changes in foreign exchange rates.

The Company's exposure in USD and other foreign currency denominated transactions in connection with export of finished goods, besides import of raw materials, capital goods and spares, etc., purchased in foreign currency, gives rise to exchange rate fluctuation risk. The Company has following policies to mitigate this risk:

The Company has entered into foreign currency forward contracts both for export and import, after taking into consideration of the anticipated foreign exchange inflows / outflows, timing of cash flows, tenure of the forward contract and prevailing foreign exchange market conditions.

Risk sensitivity on Foreign Currency Fluctuations:-

The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks. It hedges a part of these risks by using derivative financial instruments in accordance with its risk management policies.

The foreign exchange rate sensitivity is calculated for each currency by aggregation of the net foreign exchange rate exposure of a currency and a simultaneous parallel foreign exchange rates shift in the foreign exchange rates by 3%.

The following analysis is based on the gross exposure as of the relevant balance sheet date, which could affect the income statement.

29.1.(b) Interest Rate Risk

Interest rate risk is the risk that the fair value of future cash flows of an exposure will fluctuate because of changes in market interest rates. The Company's exposure to the risk of changes in market in interest rates related primarily to the Company's both long term and short term debt obligation with floating interest rates. Any changes in the interest rates environment may impact future cost of borrowings.

29.2. Credit Risk

Credit Risk is that risk that counter party will not meet its obligation under a financial instrument or customer contract, leading to financial loss. The Company is exposed to credit risk from its operating activities, primarily trade receivables and from its financial activities, including deposits with banks and other financial instruments.

a) Trade Receivables

The Company extends credit to customers in the normal course of business. Outstanding customer receivables are regularly monitored. The Company has also taken advances from its customers, which mitigate the credit risks to an extent. An impairment analysis is performed at each reporting date on an individual basis for major customers.

economic conditions and the requirements is met through capital, internal accruals, long term borrowings and short term borrowings.

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.

29.3. Liquidity Risk

Liquidity Risk is the risk that the Company may not be able to meet its present and future cash and collateral obligations without incurring unacceptable losses. The Company's objective is to maintain a balance between continuity or funding and flexibility through the use of Packing Credit and Working Capital Limits. The Company ensures it has sufficient cash to meet its operational needs while maintaining sufficient margin on its undrawn borrowing facilities at all times.

There have been no breaches in the financial covenants of any interest bearing loans / borrowing. The Company has been consistently focusing on reduction in long term borrowings.

29.5. Fair value of Financial Assets and Liabilities:-

Comparison by class of the carrying amounts and fair value of the Company's financial instruments that are recognized in the financial statements:

During the year ended 31^st March, 2023 and 31^st March, 2024, there are no transfer between Level1 and Level 2 fair value measurements and no transfer into and out of Level 3 fair value measurements and there is no transaction / balance under Level 3.

Fair Valuation Technique:

The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available. The fair values of the financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used to estimate certain fair values:-

1. Fair value of cash deposits, trade receivables, trade payables and other current financial assets and liabilities approximate their carrying amount largely due to the short term maturities of these instruments.

2. The fair value of derivatives are based on marked to market valuation statements received from banks with whom the Company has entered into the relevant contracts.

Fair value hierarchy:

The following table provides the fair value measurement hierarchy of Company's assets and liabilities, grouped into level 1 to level 3 as described below:-

1. Quoted prices / Published NAV (unadjusted) in active markets for identical assets or liabilities (Level 1).

2. Inputs other than quoted prices included within Level 1 that are observable for the asset or liability (i.e. as prices) or indirectly (i.e. derived from prices) Level 2. It includes fair value of the financial instruments that are not traded in an active market (for example, over the counter derivatives) and are determined by using valuation technique. These valuation techniques maximize the use of observable market data where it is available and rely as little as possible on the Company's specific estimates. If all significant inputs required to fair value an instrument are observable, then the instrument is included in Level 2.

3. Inputs for the asset or liability that are not based on observable market date (i.e. unobservable inputs) Level 3. If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3.

30. The Ministry of Corporate Affairs issued the Companies

(Indian Accounting Standards), (Amendments) Rules 2018, notifying the new standard IND AS 115 on Revenue from contracts with customers and it is applicable from 01.04.2018.

- Replaces IND AS 18 Revenue and IND AS 11 Construction contracts

- Establishes a new control based revenue recognition model

- Provides new and more detailed guidance on specific topics such as multiple element arrangements, variables consideration, rights of return, warranties, principal versus agent consideration, consignment arrangements, bill and hold arrangements and licensing, to name a few.

Revenue is recognised at an amount that reflects the consideration to which on entity expects to be entitled in exchange for transferring goods at services to a customer.

Adoption of IND AS 115 is not expected to have any impact on the Companies revenue and profit or loss. The Company expects the revenue recognition to occur at a point in time when the materials are delivered to at the customers in case of FIBC Bags, PP Fabric, PP Yarn, Multifilament Yarn & Cotton Yarn.

The company has capitalized Provident Fund for Rs.3.54 Lakhs and Employee State Insurance contribution for Rs.0.64 Laksh relevant to ongoing projects.

Defined Benefit Plan (Gratuity):

The Company provides gratuity to employees 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 Employees Gratuity Fund Scheme, which is a defined benefit plan, is managed by a trust maintained with Life Insurance Corporation of India (LIC).

The present value of the obligation is determined based on actuarial valuation using Projected Units Credit Method, which recognises each period of service as giving rise to additional units of employees benefit entitlement and measures each unit separately to build up the final obligation.

The following table sets out the details of amount recognised in the financial statements in respect of employee benefit schemes:

34. Details of Discontinued Operations As per IND AS-105

The continuous operational losses due to price instability of OE Yarn and country wide apparels and textiles market slowdown has led management to permanently shut down the operations of OE Yarn segment with effect from 16.06.2023. The facilities are currently used for phased expansion of FIBC division.

The Assets and Liabilities of the Discontinued Operations of Textile division have met the definition of “Held for Sale” as per the IND AS-105 and the results of the operations are reported as a separate line Item as required by the standard. The details of Assets and liabilities classified as “Held for Sale” is as follows:

The management is confident of full recovery of current assets which will be utilized to settle the current liabilities. Building value of Rs. 229 Lakhs and other incidental assets of Rs. 28 Lakhs will be utilized for FIBC division. Hence we have not classified such assets as “Held for Sale”.

Since the management is of the view that the realizable value after all the incidental expenses of the Assets classified as “Held for sale” will be more than the Carrying cost, we have not tested the Assets for Impairment as per IND AS 36.

The Results and the Total Assets and Liabilities of the discontinued segment are reported in the Segment Reporting.

The details of Machineries sold during the quarter are as under:

Total WDV of Machineries sold: Rs. 51.26 lakhs.

Sale Consideration Received including GST : Rs.88.61 lakhs.

Out of Total consideration received, the amount of Rs. 13.51 lakhs has been used for Re -paying the Short term credit facilities and the Balance portion Rs. 75.10 lakhs has been used to liquidate Term Loans.

The Management is expecting that the entire sale process will be completed before September 2024.

5 The Company has generated power out of Wind Mill installed at NH Road, Ambalavanapuram, Avarikulam Post - 627 133 Tirunelveli District and the generated power was captively consumed by the Company by drawing the power from TNEB Grid. The Power and Fuel consumed is net of Rs. 16.87 Lakhs (Previous Year: Rs.16.38 Lakhs) being the credit given by TNEB for the transfer of power to the Grid.

35.6 Our Company's shares are listed at BSE Limited with stock code of 539354.

35.7 Confirmation of balances of Trade Receivables and Payables:-

The Company requested its debtors and creditors to confirm their outstanding balances as at 31^st December, 2023 in respect of trade receivables and trade payables. Most of them have given their confirmation of balance, except few parties to be submitted, awaiting for some with clarification.

35.8 Deferred Tax (AS- 22) :

The deferred tax liabilities recognized in the earlier years has been reversed to the extent of Rs. 166.09 Lakhs due to the reclassification of Fixed assets valued Rs. 584.82 Lakhs to “ Assets Held for sale “ under current Assets classification . These assets pertain to operations of Textile division which has been discontinued. The depreciation of the Assets has been ceased to comply with the standard (IND AS -105). The carrying Amount of the Assets has been reduced to the extent of above re-classification. The Income Tax Act has not mandated such Re-classification except for the reduction of Actual consideration received for the sale of the Assets from the opening WDV. Hence the above Assets held for Sale has been retained in the Assets block for the purpose of computation of Depreciation as per Sec.32. This has resulted in reversal of deferred Tax liabilities created due to lower tax Bases of Assets in the previous years.

35.9 Regrouping of Previous year figures

Previous year's figures have been regrouped /reclassified wherever necessary, to conform to current year's classification. The following regroupings have been done in the current financial statement:-

1A

S.No. 4 The Adverse variation in Net Profit Ratio is due to significant reduction in Revenue from operation.

S.No. 5 The Adverse variation in the ROE is due to huge reduction in margins in comparison to the last financial year.

S.No.6 The Adverse variation in the ROCE is due to huge reduction in margins in comparison to the last financial year.

S.No.7 The significant positive variation in Return on Investments is due to realization of Dividends from Associate Company

36.3. Charges / Satisfaction of charges with ROC.

All the charges are registered with ROC within the stipulated time.

36.4. The Company does not have any investments through more than two layers of investments companies as per section 192 (87) (cd) and section 186 of companies Act, 2013.

36.5. There is no Scheme of Arrangements that has been approved in terms of sections 230 to 237 of the Companies Act.

36.6. i. The company has not given any Loans or

Advances in the nature of loans to promoters, directors, KMPs and their related parties (as defined under Companies Act, 2013,) either severally or jointly with any other person.

ii. The title deeds of all the immovable properties are held in the name of the Company.

iii. The Company has not revalued its Property, Plant and Equipment (including Right of use assets) or intangible assets during the year ended 31^st March, 2024.

iv. No Intangible Assets under development during the year.

v. Quarterly statements of Current Assets filed with banks and financial institutions for fund borrowed from those banks and financial institutions on the basis of security of current assets are in agreement with the books of account.

vi. No proceedings have been initiated during the year or are pending against the Company as at 31st March 2024 for holding any benami property under the benami Transactions (Prohibition) Act, 1988 (as amended in 2016) and rules made there under.

vii. The Company has not been declared willful defaulter by any bank or financial institution or government or any government authority.

viii. The company has not advanced / loaned / invested or received funds (either borrowed funds or share premium or any other sources 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 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 to or on behalf of the Ultimate Beneficiaries.

36.7. There were no transaction relating to previously unrecorded income that were surrendered or disclosed as income in the tax assessments under the income tax Act,1961 (43 of 1961).

36.8 Dividend

The final dividend on shares is recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as a liability on the date of declaration by the Company's Board of Directors. Income tax consequences of dividends on financial instruments classified as equity will be recognized according to where the entity originally recognized those past transactions or events that generated distributable profits.

The Company declares and pays dividends in Indian rupees. Companies are required to pay/distribute

dividend after deducting applicable TDS. The remittance of dividends outside India is governed by Indian law on foreign exchange and is also subject to withholding tax at applicable rates

The Board of Directors wish to conserve resources for future expansion and growth of the Company. Hence, your Directors have decided not to declare any dividend st for the financial year ended 31^st March, 2024.

36.9. The obligation with respect to Corporate Social Responsibility is not applicable to the Company for the financial year 2023 - 2024 since, the company has not fulfilled any one of criteria as provided in section 135 of the Companies Act, 2013.

36.10. The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

36.11. The Central Government has published, the Code on Social Security, 2020 and Industrial Relations Code, 2020 ("Codes"), relating to employee benefits during employment and post-employment benefits and received presidential assent in September, 2020. 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.