(i) I n accordance with IND AS 36 "Impairment of Assets" the Company has assigned the carrying value of goodwill to the Avadh business (Cash Generating Unit ('CGU')). Impairment testing of such Goodwill is performed by applying the value in use approach i.e. using cash flow projections based on financial budgets covering a period of 5 years.

Based on the results of the Goodwill impairment test, the estimated value in use for CGU was higher than the respective carrying amount, and accordingly no impairment loss has been recognised during the year (31 March 2023 - Nil). Management believes that any reasonably possible change in the key assumptions on which recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the Goodwill.

The key assumptions used in the estimation of the recoverable amount are set out below. The values assigned to the key assumptions represent management's assessment of future trends in the relevant industry and are based on historical data from both external and internal sources.

Discount rate (Pre Tax) - Weighted Average Cost of Capital % (WACC) = Risk free return (Market risk premium x Beta for the Company).

Revenue growth rate and EBITDA rate - The growth rates and EBITDA rate used to estimate cash flows for the first five years are based on past performance, and based on the strategic plan.

Terminal growth rate - long-term average growth rate for the products, industries, or country in which the entity operates.

(c) Terms and rights attached to equity shares

The Company has only one class of equity shares having par value of ' 5 (31 March 2023: ' 5) per share. Each equity share carries one vote and is entitled to dividend that may be declared by the Board of Directors, which may be subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

The Company has Prataap Employee Stock Appreciation Rights ('ESAR') Plan 2018 under which options to subscribe for the Company's shares have been granted to certain employees. The Employee stock appreciation rights reserve is used to recognise the value of equity-settled share-based payments provided to employees. The said reserve shall be utilised for issue of equity shares of the Company against the rights exercisable by the employees under the ESAR Plan 2018.

* Refer Note 50

1. The secured term loan from bank carries a rate of interest of 3M T Bill rate spread (31 March 2024 : 8.05%) and interest is to be serviced at the end of each month. The term loan is repayable in 20 equal quarterly instalments, the first installment is due on 30 April 2025. The term loan is secured by first charge on current assets (inventory and receivables) and the movable fixed assets of its plant located at Jammu & Kashmir with a carrying amount of ' 2479.96 Lacs.

2. The Unsecured short term loan from a bank carries a rate of interest of Nil (31 March 2023 : 8.10%) and interest is to be serviced as and when charged. The said loan is repayable on demand.

NOTE 33: EARNINGS PER SHARE CEPS')

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the parent by the weighted average number of equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders of the parent by the weighted average number of equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on conversion of all the dilutive potential equity shares into equity shares.

NOTE 34: EMPLOYEE BENEFITS (a) Defined contribution plans

a. Provident and other fund

The Company makes provident and other funds to defined contribution plan for eligible employees. Under the scheme, the Company is required to contribute a specified percentage of the payroll costs. The Company has no obligation, other than the contribution payable to the fund. The Company recognises contribution payable to the provident fund scheme as an expense, when an employee renders the related service.

(b) Defined benefit plans Gratuity - Non-funded

The Company has a defined benefit gratuity plan. Every employee who has completed five years of service is eligible for gratuity on retirement at 15 days of last drawn salary for each completed year of service. The aforesaid liability is provided for on the basis of an actuarial valuation made at the end of the financial year. The gratuity plan is unfunded.

Sensitivity analysis is performed by varying a single parameter while keeping all the other parameters unchanged. Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously. The method used does not indicate anything about the likelihood of change in any parameter and the extent of the change if any.

The average duration of the defined benefit plan obligation at the end of the reporting period is 8.44 years (As at 31 March 2023: 8.52 years)

NOTE 35: LEASES i) Company as a lessee

The Company has lease contracts for land, building and manufacturing facilities with lease term ranging between 2 to 10 years. There are certain lease contracts that include extension and termination options. These options are negotiated by management to provide flexibility in managing the leased-asset portfolio and align with the Company's business needs. Management exercises judgement in determining whether these extension and termination options are reasonably certain to be exercised.

The Company also has certain leases of office premises and warehouses with lease term of 12 months or less and those of low value. The Company applies the 'short-term lease' and 'lease of low-value assets' recognition exemptions as available in Ind AS 116 'Leases' for these leases.

1. I n the previous year, the Company received a demand order in respect of the period 2017-2021 from the Commercial Tax department "GST" Madhya Pradesh regarding the classification issue for its product category "Fried Namkeen - Fryums". The Company has filed an appeal against the said order before Joint Commissioner (Appeals) which is pending for disposal as at year end. The Company has assessed the impact of this matter on subsequent year also and accordingly disclosed the above amount.

2. There were many interpretative issues relating to the Supreme Court (SC) judgement dated 28 February 2019 on Provident Fund (PF) as regards definition of PF wages and inclusion of certain allowances for the purpose of PF contribution, as well as effective date of its applicability. Having consulted and evaluated impact on its financial statement, the Company has implemented the changes as per clarifications vide the Apex Court judgement dated 28 February 2019, with effect from 1 March 2019

i.e., immediately after pronouncement of the judgement. The Company will evaluate its position, in case there is any other interpretation issued in future either in form of Social Security Code 2020, or by authorities concerned under the Employees' Provident Funds and Miscellaneous Provisions Act.

3. The Code on Social Security 2020 has been notified in the Official Gazette on 29 September 2020. The effective date from which the changes are applicable is yet to be notified and the rules are yet to be framed. Impact if any of the change will be assessed and accounted in the period in which the said Code becomes effective and the rules framed thereunder are notified.

The Company, in respect of the above mentioned contingent liabilities has assessed that it is only possible but not probable that outflow of economic resources will be required.

Terms and conditions of transactions with related parties

The Company's material related party transactions and outstanding balances are with related parties with whom the Company's routinely enters into transactions in the ordinary course of business at arm's length price.

NOTE 39: SEGMENT INFORMATION

For management purpose, the Company comprises of only one reportable segment - Snacks food. The Management monitors the operating results of this segment for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the standalone financial statements.

C] Notes

1. Segment revenue in the geographical segments considered for disclosure are as follows:

a) Revenue within India includes sales to customers located within India.

b) Revenue outside India includes sales to customers located outside India.

2. The Company does not have any customer, with whom revenue from transactions is more than 10% of Company's total revenue.

3. Non current assets consist of property, plant and equipment, capital work-in-progress, goodwill, intangible assets, capital advances and intangible assets under development.

NOTE 40: GOVERNMENT GRANTS

Government grant consists of GST incentive amounting to ' 39.53 lakhs (31 March 2023: ' 94.77 lakhs) and capital subsidy amounting to ' 317.62 lakhs (31 March 2023: ' 336.50 lakhs). There are no unfulfilled conditions or contingencies attached to these grants.

NOTE 41: EXCEPTIONAL ITEM

There was a fire accident in the finished goods warehouse of one of the Company's Co-manufacturing plant situated at Hoogly, West Bengal, on 6 June 2023. The fire impacted the inventories lying at the warehouse; however, there were no human casualties. The total financial loss due to this event is ' 95.91 lakhs. Considering the nature of the event and magnitude of financial impact, this loss has been disclosed as an exceptional item in the statement of profit and loss for the year ended 31 March 2024. Pending completion of the survey and acceptance of the claim by the insurance company, the insurance claim receivable has not been recorded in the financial statements.

NOTE 42: EMPLOYEE STOCK APPRECIATION RIGHTS

The Nomination and Remuneration Committee of the Board of Directors of the Company at its meeting held on 9 August 2019, 4 February 2022, 19 August 2022 and 02 August 2023 have granted 3,47,000, 59,800, 2,00,821 and 4,927 Stock Appreciation Rights ('SAR') respectively to eligible employees of the Company under the Prataap Employees Stock Appreciation Rights Plan 2018 ('ESAR'). The said ESAR was approved by the shareholders in their Annual General Meeting held on 28 September 2018. The rights entitle the employees, to equity shares of the Company on the satisfaction of service conditions attached to the grant and consequent exercise of the rights by the employees. The SAR's shall be vested in four equal instalments every year commencing from the end of one year from the grant date. The number of equity shares to be issued shall be determined based on the difference between the base price as per the scheme and the share price on the date of exercise. The SAR's expire at the end of 5 years from the grant date.

The management assessed that fair value of trade receivables, other current financial assets, current loans, cash and bank balances, 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 included at 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:

1. Loans and other financial assets are evaluated by the Company based on parameters such as interest rates, individual credit worthiness of the counterparties and expected duration of realisability as at the balance sheet date.

The Company determines the fair value of its financial instruments on the basis of the following hierarchy:

Level 1: The fair value of financial instruments that are quoted in active markets are determined on the basis of quoted price for identical assets or liabilities.

Level 2: The fair value of financial instruments that are not traded in an active market are determined using valuation techniques based on observable market data.

Level 3: The fair value of financial instruments that are measured on the basis of entity specific valuations using inputs that are not based on observable market data (unobservable inputs).

There are no transfers between different fair value hierarchy levels in 31 March 2024 and 31 March 2023.

Fair value measurements

The following table shows the valuation technique used in measuring level 2 for financial instruments

NOTE 45: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company's principal financial liabilities comprise borrowings, lease liabilities, trade and other payables. The main purpose of these financial liabilities is to finance the Company's operations. The Company's principal financial assets include loans, subsidy receivable, cash and cash equivalents, trade receivables and other receivables that are derived directly from its operations.

The Company is exposed to market risks, credit risks and liquidity risks. The Company's senior management oversees the management of these risks. The Company's senior management provides assurance that the Company's financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company's policies and risk objectives. The Board of Directors review and agree policies for managing each of these risks.

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. Market risk comprises three types of risks namely interest rate risk, currency risk and price risk, such as equity price risk. The Company is not significantly exposed to currency risk and price risk whereas the exposure to interest risk is given below.

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's exposure to the risk of changes in market interest rates relates primarily to the Company's borrowings.

Interest rate sensitivity

The sensitivity analysis below have been determined based on exposure to interest rates for term loans that have floating rate at the end of the reporting period and the stipulated change taking place at the beginning of the financial year and held constant throughout the reporting period.

If the interest rates had been 100 basis points higher or lower and all the other variables were held constant, the effect on Interest expense for the respective financial years and consequent effect on Company's profit in that financial year would have been as below:

Credit Risk

Credit risk is the risk that the counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk arising on its trade receivables. Based on the historical experience and credit profile of counterparties (scheduled banks, government and employees), the Company does not expect any significant risk of defaults arising on financial assets except trade receivables i.e. loans, subsidy receivables, cash and cash equivalents and other financial assets.

Refer Note a below for credit risk and other information in respect of trade receivables. a. Trade receivables

Customer credit is managed by the Company through established policies and procedures related to customer credit risk management. Each outstanding customer receivables are regularly monitored and if outstanding is above due date, the further shipments are controlled and can only be released if there is a proper justification.

The Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed. Based on the industry practices and the business environment in which the Company operate, management considers the trade receivables are in default (credit impaired) if the payments are more than 365 days past due.

The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and operate in largely independent markets and are monitored at periodical intervals. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets.

Liquidity Risk

(i) Liquidity risk management

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 principle sources of liquidity are cash and bank balances, fixed deposits and the cash flow that is generated from operations. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. The Company believes that the working capital is sufficient to meet its current requirements. Accordingly, liquidity risk is considered as low. The Company closely monitors its liquidity position and also maintains adequate source of funding.

(ii) Maturities of financial liabilities

The following tables detail the Company's remaining contractual maturity for its financial liabilities with agreed repayment periods. The amount disclosed in the tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the end of the reporting period. The contractual maturity is based on the earliest date on which the Company may be required to pay.

Notes:

¹. Debt - equity ratio - Increase in long term secured debt resulted in increase in ratio.

². Debt service coverage ratio - Increase in profit for the year has resulted in increase in ratio.

³. Return on equity ratio - Increase in profit for the year has resulted in increase in ratio.

⁴. Net capital turnover ratio -Increase in working capital has resulted in decrease in ratio.

⁵. Net profit ratio - Increase in profit for the year has resulted in increase in ratio.

⁶. Return on capital employed - Increase in profit for the year has resulted in increase in ratio.

⁷. Return on Investment- Increase in rate of interest on fixed deposits has resulted in increase in ratio.

NOTE 47: CAPITAL MANAGEMENT

For the purpose of the Company's capital management, equity includes issued equity capital, securities premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company's capital management is to maximise the shareholders' value. The Company's capital management objectives are to maintain equity including all reserves to protect economic viability and to finance any growth opportunities that may be available in future so as to maximise shareholders' value. The Company is monitoring capital using debt equity ratio as its base, which is debt to equity. The Company's policy is to keep healthy debt equity ratio ensuring minimum debt. The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants.

(i) The Company does not have any Benami property. Further, there are no proceedings initiated or pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

(ii) Except as disclosed below, the Company does not have any transactions with companies struck off under section 248 of Companies act 2013 :

Buoyant Insurances Services Private Limited held 15 shares at face value of ' 5 per share.

(iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the current financial year and previous financial year

(v) The Company has not advanced or loaned or invested funds to any other person(s) or 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 identified 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

(vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,

(vii) The Company does not have any such transactions which has not been recorded in the books of accounts but 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

(viiI) The Company has not been declared as wilful defaulter by any bank of financial institution or other lender NOTE 49: SCHEME OF AMALGAMATION

The Board of Directors of the Company at its meeting held on 29 September 2021 had approved the Scheme of Arrangement (the "Scheme") for merger of its subsidiaries (transferor companies) with the company (transferee company). Application seeking approval of the Scheme was subsequently filed with Hon'ble National Company Law Tribunal (NCLT), Ahmedabad bench and Indore bench on 8 June 2022 and 12 May 2022 respectively.

NCLT, Ahmedabad bench sanctioned the Scheme and pronounced its order on 10 February 2023 certified copy of which was received by the company on 23 February 2023. NCLT, Indore bench sanctioned the Scheme and pronounced its order on 3 March 2023 and suo moto amended on 15 March 2023 certified copy of which was received by the company on 21 March 2023.

Accordingly, the Company had given effect to the Scheme from the appointed date i.e. 1 April, 2021 in the financial statements for the year ended 31 March 2023 by restating the earlier standalone financial statements for the year ended 31 March 2022 as if the business combination had occurred from the beginning of the preceding period i.e. 1 April 2021.

Pursuant to the Scheme, all the assets, liabilities, reserves and surplus of the transferor companies had been transferred to and vested in the Company with effect from the appointed date at their respective carrying values as per requirements of Appendix C to Ind AS 103.

Pursuant to the Scheme the merger had been accounted for as per the applicable accounting principals prescribed under the relevant Indian Accounting Standards.

(a) Accounting Treatment

(i) The transferee Company had recorded all the assets and liabilities of the transferor companies vested in it pursuant to this Scheme, at the carrying values as appeared in the consolidated financial statements of Transferee Company.

(ii) The identity of the reserves had been preserved and the Transferee Company recorded the reserves of the Transferor Companies, at the carrying amount as appeared in the consolidated financial statements of Transferee Company.

(iii) The value of all investments held by the Transferee Company in the Transferor Companies stood cancelled pursuant to amalgamation and difference, if any that arised after taking the effect of schemes had been transferred to "Capital Reserve Account" in the financial statements of the Transferee Company.

(iv) Pursuant to the amalgamation of the Transferor Companies with the Transferee Company, inter-company balances between Transferee Company and the Transferor Companies, if any, appearing in the books of the Transferee Company stood cancelled.

(a) The authorised share capital of the Transferee Company as at 31 March 2023 automatically stood increased, by clubbing the authorised share capital of the Transferor Companies which is ' 1075 lakh divided into 215 lakh equity shares of ' 5 each.

(b) Further, pursuant to the approval of the Scheme from the specified retrospective appointed date of 1 April 2021, a revised return of income for the year ended 31 March 2022 after taking into consideration the overriding effect of the provision in the Scheme was filed by the Company. The impact of such revised return on the current and deferred tax was recognised in the statement of profit and loss for the year ended 31 March 2023.

NOTE 50: CONSOLIDATION OF PRATAAP SNACKS EMPLOYEE WELFARE TRUST (THE 'TRUST')

The company had formulated an Employee Stock Purchase Plan (ESPP) where the company granted loan to employees through a separate Prataap Snacks employee welfare trust (the 'Trust') for providing monetary assistance to the employees for acquisition of shares granted under the ESPP plan. The Trust was identified as a subsidiary. In the standalone financial statements, the Company had adopted the policy of considering the trust as a legal entity separate from the Company and therefore, was not consolidating the Trust in the standalone financial statements. The Company recognized the loan given to the Trust as financial asset and tested it for impairment on a periodic basis in accordance with the requirements of applicable accounting standards. However, given that the Trust was identified as a subsidiary, in the consolidated financial statements of the Company, the Trust was consolidated for the purpose of consolidated financial statements and consequently, the related loan to Trust (including interest) appearing in the standalone financial statements of the Company was eliminated.

During the year ended 31 March 2024, the Company changed its accounting policy whereby it decided to consolidate the Trust in the financial statements to reflect a more appropriate presentation of the activity of the Trust in the financial statements as the Trust carried out activities for the benefit of the employees of the Company. Consequently, in the financial statements of the Company, the loan given to the Trust (including interest) is eliminated.

This change in accounting policy in the financial statements has been given effect by restating the comparative information for the preceding period in accordance with the requirements of applicable standards for change in accounting policy.