Accounting Policies of Shreyans Industries Ltd. Company

Mar 31, 2025

2.3 Material accounting policies

a) Revenue Recognition
Revenue

Revenue towards satisfaction of performance obligation is measured at the amount of transaction price allocated to that
performance obligation. The transaction price of goods sold is net of variable consideration on account of various discounts and

schemes offered by the company as a part of the contract.

i) Sale of products

The company derives revenue primarily from the sale of Writing and Printing Paper and Soda Ash.

Revenue from the sale of goods is recognized at the point in time when control is transferred to the customer which is usually on
dispatch/ delivery.

Revenue is measured based on the transaction price (net of variable consideration) which is consideration, adjusted for volume
discounts, rebates, scheme allowances, price concessions, incentives, and returns, if any, as specified in the contracts with the
customers.

Revenue excludes taxes collected from customers on behalf of the government.

Due to the short nature of credit period given to customers, there is no financing component in the contract.

ii) Interest income

- Interest Income from customers is recognized on a time proportionate basis taking into account the amount outstanding and the
interest rate applicable.

- Interest Income from financial asset is recognized when it is probable that economic benefits will flow to the company and amount
of income can be measured reliably. Interest income is accrued on time basis, by reference to principal outstanding and at effective
interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of financial
asset to that asset’s net carrying amount on initial recognition.

iii) Dividend income

Dividend income from investment is recognized when the right to receive the payment is established by the reporting date and
amount of dividend can be measured reliably, the dividend does not represent a recovery of part of cost of the investment.

iv) Insurance and Other Claims

Insurance claims are recognized when no significant uncertainty exists with regard to the amount to be realized and the ultimate
collection thereof.

b) Employee Benefits

i) Short Term Employee benefit:

The short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised on an
undiscounted accrual basis during the year when the employees render the services. These benefits include performance
incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the
employee renders the related services.

Post Employment Benefit Plan

ii) Defined Contribution plan
Provident Fund:

Employees receive benefit in the form of Provident fund which is a defined contribution plan. The company has no obligation, other
than the contribution payable to the provident fund. The company recognises contribution payable to the provident fund scheme as
an expense, when an employee renders the related service.

iii) Defined Benefit Plan
Gratuity:

The Company provides for gratuity, a defined benefit retirement plan “The gratuity plan” covering eligible employees. The gratuity
plan provides for lump sum payment to vested employee at retirement, death, incapacitation or termination of employee of an
amount based on the respective employees’ salary and the tenure of employment with the company.

Payments to defined contribution retirement benefit plans are recognised as an expense when employees have rendered service
entitling them to the contributions.

For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with
actuarial valuations being carried out at the end of each balance sheet date. Re-measurement, comprising actuarial gains and
losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest), is reflected
in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Re¬
measurement recognised in other comprehensive income is reflected in retained earnings and is not reclassified to profit or loss.
Past service cost is recognised in profit or loss in the period of a plan amendment. Net interest is calculated by applying the discount
rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorised as follows:

a. service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

b. net interest expense or income; and

c. re-measurement

The Company presents the first two components of defined benefit costs in profit or loss in the line item ’Employee benefits
expense’. Curtailment gains and losses are accounted for as past service costs.

The retirement benefit obligation recognised in the balance sheet represents the actual deficit or surplus in the Company’s defined
benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form
of refunds from the plans or reductions in future contributions to the plans.

A liability for a termination benefit is recognised at the earlier of when the entity can no longer withdraw the offer of the termination
benefit and when the entity recognises any related restructuring costs.

iv) Other long term employee benefit
Compensated absences:

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee
renders the related services are recognised as a liability in respect of other long-term employee benefits and measured at the
present value of the estimated future cash outflows expected to be made by the Company in respect of services provided by
employees up to the reporting date.

c) Property, Plant and Equipment

a) Freehold land is stated at historical cost and not depreciated. All other items of property, plant and equipment are stated at cost or
deemed cost applied on transition to Ind AS, less accumulated depreciation and impairment, if any.

b) On transition to Ind As, the company has elected to continue with the carrying value of all its Property, plant & equipment and
Intangible assets recognised as at 1st April, 2016 measured as per previous GAAP and used that carrying value as it’s deemed cost
of it’s Property, plant & equipment and Intangible assets.

c) The Cost of an item of Property, Plant and Equipment comprises its purchase price net of recoverable taxes where applicable and
any attributable expenditure (directly or indirectly) for bringing the asset to its working condition for its intended use and the
borrowing costs for qualifying assets and the initial estimate of restoration cost if the recognition criteria are met. the initial estimate
of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which an entity incurs
either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to
produce inventories during that period. When significant parts of plant and equipment are required to be replaced at intervals, the
Company depreciates them separately based on their specific useful lives.

An item of Property, Plant and Equipment and any significant part initially recognized is derecognised upon disposal or when no
future economic benefits are expected from its use. Any gain or loss arising on derecognition of the asset measured as the
difference between the net disposal proceeds and the carrying amount of the asset is included in the statement of Profit and loss
when the asset is derecognized.

The depreciation method, useful lives and residual value are reviewed periodically and at the end of each reporting period. The
company depreciates property, plant and equipment over their estimated useful lives using the straight-line method. The estimated
useful lives of assets as prescribed under Part C of Schedule II of the Companies Act 2013 except the assets costing Rs 5000/- or
below on which deprecation is charged @ 100% per annum on proportionate basis, are as follows:

Building - 30-60 years

Plant and Machinery - 15-25 years

Office Equipment - 05 years

Computer Equipment - 03 years

Furniture and fittings - 10 years

Vehicles excluding Motor cycles - 08 years

Motor cycles - 10 years

Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as
capital advances under other non-current assets. Capital work in Progress includes assets not ready for their intended use and
includes related incidental expenses.

Subsequent expenditures relating to property, plant and equipment is capitalized only when it is probable that future economic
benefits associated with these will flow to the Company and the cost of the item can be measured reliably. Repairs and maintenance
costs are recognized as expense in the Statement of Profit and Loss as and when incurred.

The cost and related accumulated depreciation are eliminated from the financial statements upon sale or retirement of the asset
and the resultant gains or losses are recognized in the statement of profit and loss.

Depreciation is recognised so as to write off the cost of assets (other than freehold land and properties under construction) less their
residual values over their useful lives, using the straight-line method.

d) Intangible assets

Intangible assets with finite useful lives that are acquired separately are stated at cost less accumulated amortisation and
accumulated impairment losses, if any. Amortisation is recognised on a straight-line basis over their estimated useful lives. The
estimated useful life and amortisation method are reviewed at the end of each reporting period, with the effect of any changes in
estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired separately are
carried at cost less accumulated impairment losses.

An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or
losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the
carrying amount of the asset are recognised in the statement of profit and loss when the asset is derecognised

Estimated useful lives of the intangible assets are as follows:

Computer Softwares 6 Years

e) Impairment of property, plant and equipment and Intangible assets

Property, plant and equipment and intangible assets are evaluated for recoverability whenever events or changes in circumstances
indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the
higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not
generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined
for the CGU (Cash Generating unit) to which the asset belongs.

If such assets are considered to be impaired, the impairment to be recognized in the statement of profit and loss is measured by the
amount by which the carrying value of the assets exceeds the estimated recoverable amount of the asset. An impairment loss is
reversed in the statement of profit and loss if there has been a change in the estimates used to determine the recoverable amount.
The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount does not exceed the
carrying amount that would have been determined (net of any accumulated depreciation) had no impairment loss been recognized
for the asset in prior years.

Impairment is reviewed periodically, including at each financial year end.

f) Inventories

Inventories of raw materials, stores and spares, work-in-progress and finished goods are valued at cost or net realisable value,
whichever is lower. However, materials and other items held for use in the production of inventories are not written down below cost
if the finished products in which they will be incorporated are expected to be sold at or above cost. The cost in respect of the
aforesaid items of inventory is computed as under:

- In case of raw materials, at first in first out cost plus direct expenses.

- In case of stores and spares, at weighted average cost plus direct expenses.

- In case of work-in-progress, at material cost plus conversion cost depending upon the stage of completion.

- In case of finished goods, at material cost plus conversion cost, packing cost and other overheads incurred to bring the goods to
their present condition and location.

- In Case of Material in T ransit, Actual cost plus direct expenses to the extent incurred.

Net realizable value is the estimated selling price in ordinary course of business less estimated costs of completion and the
estimated costs necessary to make the sale.

g) Government Grants

(i) The government grants are recognized only when there is reasonable assurance that the conditions attached to them will be
complied with, and the grants will be received.

(ii) Government grants in relation to fixed assets are treated as deferred income and are recognized in the statement of profit and
loss on a systematic and rational basis over the useful life of the asset.

(iii) Government grants related to revenue are recognized on a systematic basis in the statement of profit and loss over the period
necessary to match them with the related costs that they are intended to compensate.

(iv) Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving
immediate financial support to the company with no future related costs are recognized in the Statement of profit and loss in the
period in which they become receivable.

(v) Export benefits are accounted for in the year of exports based on eligibility and when there is no uncertainty in receiving the
same.

h) Borrowing costs

Borrowing costs that are directly attributable to the acquisition or construction of items of Property, plant and equipment which
necessarily takes substantial period of time to get ready for their intended use are capitalized as part of the cost of the asset. Other
borrowing costs are recognized as an expense in the period in which they are incurred. Borrowing cost also includes exchange
differences arising from foreign currency borrowings to the extent regarded as an adjustment to the interest costs.

i) Leases

The Company as a lessee

The Company’s lease asset classes primarily consist of leases for land and office building. The Company assesses whether a
contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the
use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to
control the use of an identified asset, the Company assesses whether: (i) the contract involves the use of an identified asset (ii) the
Company has substantially all of the economic benefits from use of the asset through the period of the lease and (iii) the Company
has the right to direct the use of the asset.

At the date of commencement of the lease, the Company recognizes a right-of-use asset (“ROU”) and a corresponding lease
liability, except for leases with a term of twelve months or less (short-term leases) and leases for which underlying asset is of low
value. For these short-term and leases for which underlying asset is of low value, the Company recognizes the lease payments as
an operating expense on a straight-line basis over the term of the lease.

The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any lease

payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease incentives. They are
subsequently measured at cost less accumulated depreciation and impairment losses.

Right-of-use assets is subsequently depreciated from the commencement date on a straight-line basis over the shorter of the lease
term or useful life of the underlying asset. Right of use assets are evaluated for recoverability whenever events or changes in
circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable
amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the
asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount
is determined for the Cash Generating Unit (CGU) to which the asset belongs.

The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease payments are
discounted using the interest rate implicit in the lease or, if not readily determinable, using the company’s incremental borrowing
rate.

Lease liabilities are remeasured with a corresponding adjustment to the related right of use asset if the Company changes its
assessment if whether it will exercise an extension or a termination option.

The Company as a lessor

Leases for which the company is a lessor is classified as a finance or operating lease. Whenever the terms of the lease transfer
substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are
classified as operating leases.

For operating leases, rental income is recognized on a straight line basis over the term of the relevant lease.

j) Foreign currency transactions
Transaction and balances

Foreign currency transactions are initially recorded, on initial recognition in the functional currency, by applying to the foreign
currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction.
Monetary items denominated in foreign currency are recognised using the closing exchange rate as on balance sheet date.

The non-monetary items that are measured in terms of historical cost in foreign currency are not retranslated.

Exchange differences arising on the settlement of monetary items or on reporting of monetary items at rates different from rates at
which these were recognised on initial recognition during the period or reported in previous financial statements are recognised in
the statement of Profit and Loss in the period in which they arise. All foreign exchange gains and losses are presented in the
statement of profit and loss on net basis.

k) Accounting for Taxes on income

i. Income tax expense comprises of current and deferred tax. Income tax expense is recognized in the statement of profit and loss
except to when it relates to items recognized directly in equity or items recognised in other comprehensive income in which
case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively.

ii. Current income tax for current period is recognized at the amount expected to be paid to or recovered from the tax authorities,
using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

iii. Deferred tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements.

iv. Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted
by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are
expected to be recovered or settled. The effect of changes in tax rates on deferred tax assets and liabilities is recognized as
income or expense in the period that includes the enactment or the substantive enactment date.

v. A deferred tax asset is recognized to the extent that it is probable that future taxable profit will be available against which the
deductible temporary differences and tax losses can be utilized. Deferred tax assets are reviewed at each reporting date and
are reduced to the extent that it is no longer probable that the related tax benefit will be realized. Deferred tax assets and
deferred tax liabilities have been offset as they are governed by the same taxation laws.

vi. The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the
recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability
simultaneously.

l) Earnings per share

Basic earnings per equity share are computed by dividing the net profit attributable to the equity holders of the Company by the
weighted average number of equity shares outstanding during the period. Diluted earnings per equity share is computed by dividing
the net profit attributable to the equity holders of the Company by the weighted average number of equity shares considered for
deriving basic earnings per equity share and also the weighted average number of equity shares that could have been issued upon
conversion of all dilutive potential equity shares. The dilutive potential equity shares are adjusted for the proceeds receivable had
the equity shares been actually issued at fair value (i.e. the average market value of the outstanding equity shares). Dilutive
potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date. Dilutive potential
equity shares are determined independently for each period presented.

m) 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. Company is required to pay / distribute dividend after
deducting applicable taxes.

The Company incurred a cash outflow of F691.23 lakhs during the year ended 31st March, 2025, on account of the final dividend for
fiscal 2024. The Board of Directors recommended a final dividend of F3.00 per equity share and special dividend of F2.00 per equity
share for the financial year ended 31st March 2025. This payment is subject to the approval of shareholders in the ensuing Annual
General Meeting of the Company and if approved, would result in a cash outflow of approximately F691.23 lakhs.

n) Financial Instruments

i) Initial Recognition and measurement

Financial assets and financial liability are recognised when the company entity becomes a party to the contractual provisions of the
instruments.

All financial assets and liabilities are initially recognized at fair value plus or minus transaction cost that are directly attributable to
the acquisition or issue of financial asset or financial liability on initial recognition. However, trade receivables that do not contain a
significant financing component are measured at transaction price.

Transaction cost that are directly attributable to the acquisition of financial assets and financial liabilities that are carried at fair value
through profit or loss are immediately recognized in the statement of profit and loss.

ii) Subsequent measurement
A) Financial assets

All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way
purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by
regulation or convention in the marketplace.

All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair value, depending on the
classification of the financial assets
> Non-derivative financial instruments

1. Financial assets carried at amortised cost

A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the
asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to
cash flows that are solely payments of principal and interest on the principal amount outstanding.

2. Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business
model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual
terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the
principal amount outstanding.

Interest income is recognised in profit or loss for instruments measured at Fair value through other comprehensive income
(FVTOCI). All other financial assets are subsequently measured at fair value.

Effective interest method

The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income
over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all
fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or
discounts) through the life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial
recognition.

Income is recognised on an effective interest basis for debt instruments other than those financial assets classified as at FVTPL.
Interest income is recognised in profit or loss and is included in the “Other income” line item.

3. Investment in Equity Instruments measured at fair value through OCI

On initial recognition, the company can make an irrevocable election for its investment which are classified as equity
instruments to present the subsequent changes in fair value in other comprehensive income based on its business model.
These elected investments are initially measured at fair value plus transaction cost, subsequently there are measured at fair
value with gains and losses arising from changes in fair value recognized in Other Comprehensive Income and accumulated in
the Reserve for equity instruments through Other Comprehensive Income. The cumulative gain or loss is not reclassified to the
statement of profit and loss on disposal of the investments.

- The above election is not permitted if the equity investment is held for trading.

Dividend on these investments in equity instruments are recognised in the Statement of profit and loss when the Company’s
right to receive the dividends is established, it is probable that the economic benefits associated with the dividend will flow to the
entity, the dividend does not represent a recovery of part of cost of the investment and the amount of dividend can be measured
reliably. Dividends recognized in the statement of profit and loss are included in ’other income’ line item.

4. Financial assets at fair value through profit or loss

A financial asset which is not classified in any of the above categories is subsequently measured at fair valued through profit or
loss. Debt instruments that meet the amortised cost criteria or the fair value through other comprehensive income but are
designated as fair value through profit or loss are measured at FVTPL.

5. Impairment of financial assets

The Company applies the expected credit loss model for recognising impairment loss on financial assets measured at

amortised cost, debt instruments at FVTOCI, lease receivables, trade receivables, other contractual rights to receive cash or
other financial asset not designated as at FVTPL.

Expected credit losses are the weighted average of credit losses with the respective risks of default occurring as the weights.
Credit loss is the difference between all contractual cash flows that are due to the Company in accordance with the contract and
all the cash flows that the Company expects to receive (i.e. all cash shortfalls), discounted at the original effective interest rate
(or credit-adjusted effective interest rate for purchased or originated credit-impaired financial assets). The Company estimates
cash flows by considering all contractual terms of the financial instrument (for example, prepayment, extension, call and similar
options) through the expected life of that financial instrument.

When making the assessment of whether there has been a significant increase in credit risk since initial recognition, the
Company uses the change in the risk of a default occurring over the expected life of the financial instrument instead of the
change in the amount of expected credit losses. To make that assessment, the Company compares the risk of a default
occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial instrument as at
the date of initial recognition and considers reasonable and supportable information, that is available without undue cost or
effort, that is indicative of significant increases in credit risk since initial recognition.

For trade receivables or any contractual right to receive cash or another financial asset that result from transactions that are
within the scope of Ind AS 115, the Company always measures the loss allowance at an amount equal to lifetime expected credit
losses.

Further, for the purpose of measuring lifetime expected credit loss allowance for trade receivables, the Company has used a
practical expedient as permitted under Ind AS 109. The Company follows simplified approach for recognition of impairment loss
allowance on trade receivables. The application of simplified approach does not require the Company to track changes in credit
risk. Rather, it recognises impairment loss allowance based on lifetime ECL’s at each reporting date, right from its initial
recognition.

The impairment requirements for the recognition and measurement of a loss allowance are equally applied to debt instruments
at FVTOCI except that the loss allowance is recognised in other comprehensive income and is not reduced from the carrying
amount in the balance sheet.

6. De-recognition of Financial Assets

The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or when it
transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Company
neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset,
the Company recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the
Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company continues to
recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.

On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the
consideration received and receivable and the cumulative gain or loss that had been recognised in other comprehensive
income and accumulated in equity is recognised in profit or loss if such gain or loss would have otherwise been recognised in
profit or loss on disposal of that financial asset.

On derecognition of a financial asset other than in its entirety (e.g. when the Company retains an option to repurchase part of a
transferred asset), the Company allocates the previous carrying amount of the financial asset between the part it continues to
recognise under continuing involvement, and the part it no longer recognises on the basis of the relative fair values of those
parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognised
and the sum of the consideration received for the part no longer recognised and any cumulative gain or loss allocated to it that
had been recognised in other comprehensive income is recognised in profit or loss if such gain or loss would have otherwise
been recognised in profit or loss on disposal of that financial asset. A cumulative gain or loss that had been recognised in other
comprehensive income is allocated between the part that continues to be recognised and the part that is no longer recognised
on the basis of the relative fair values of those parts.

7. Foreign Exchange Gains and Losses

The fair value of financial assets denominated in a foreign currency is determined in that foreign currency and translated at the
spot rate at the end of each reporting period.

For foreign currency denominated financial assets measured at amortised cost and FVTPL, the exchange differences are
recognised in profit or loss.

> Derivative financial instruments

The Company enters into derivative financial instruments to manage its exposure to foreign exchange rate risks and to manage its
exposure to imported raw material price risk including foreign exchange forward contracts and commodities future contracts.
Derivatives are initially recognised at fair value at the date the derivative contracts are entered into and are subsequently
remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognised in profit or loss
immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in
profit or loss depends on the nature of the hedging relationship and the nature of the hedged item.

B. Financial liabilities

The financial liabilities are subsequently carried at amortized cost using the effective interest method.

1. Financial Liability at fair value through Profit or Loss

Financial liabilities are classified as at FVTPL when the financial liability is either contingent consideration recognised by the
Company as an acquirer in a business combination to which Ind AS 103 applies or is held for trading or it is designated as at
FVTPL

A financial liability is classified as held for trading if:

a. it has been incurred principally for the purpose of repurchasing it in the near term; or

b. on initial recognition it is part of a portfolio of identified financial instruments that the Company manages together and has a
recent actual pattern of short-term profit-taking; orc. it is a derivative that is not designated and effective as a hedging
instrument.

2. Financial Liabilities Subsequently measured at Amortised Cost

Financial liabilities that are not held-for-trading and are not designated as at FVTPL are measured at amortised cost at the end of
subsequent accounting periods. The carrying amounts of financial liabilities that are subsequently measured at amortised cost
are determined based on the effective interest method. Interest expense that is not capitalised as part of costs of an asset is
included in the ’Finance costs’ line item.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest
expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments
(including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other
premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net
carrying amount on initial recognition.

3. De-recognition of Financial Liablities

The Company derecognises financial liabilities when, and only when, the Company’s obligations are discharged, cancelled or
have expired. An exchange between with a lender of debt instruments with substantially different terms is accounted for as an
extinguishment of the original financial liability and the recognition of a new financial liability. Similarly, a substantial modification
of the terms of an existing financial liability (whether or not attributable to the financial difficulty of the debtor) is accounted for as
an extinguishment of the original financial liability and the recognition of a new financial liability. The difference between the
carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in profit or loss.

> Cash Flow Hedge

The Company has not designated derivative financial instruments as cash flow hedges.

> Equity Instruments:

Equity instrument are any contract that evidences a residual interest in the assets of an equity after deducting all of its liabilities.

Debt or equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the
substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

> Ordinary Shares

Equity shares issued by the company are classified as equity. Incremental costs directly attributable to the issuance of new ordinary
shares and share options are recognized as a deduction from equity, net of any tax effects.

o) Segment reporting

An operating segment is a component of the company that engages in business activities from which it may earn revenues and
incur expenses, including revenues and expenses that relate to transactions with any of the company’s other components, and for
which discrete financial information is available. Segments are identified based on the manner in which the Company’s Chief
Operating Decision Maker (’CODM’) decides about resource allocation and reviews performance.

p) Cash flow statement

The Cash flows are reported using the indirect method, whereby profit for the year is adjusted for the effects of transactions of a non¬
cash nature and item of income or expenses associated with investing or financing cash flows. The cash flows from operating,
investing and financing activities of the Company are segregated. The Company considers all highly liquid investments that are
readily convertible to known amounts of cash to be cash equivalents.

q) Cash and cash equivalent

Cash and cash equivalent for the purpose of statement of cash flows include bank balances, where the original maturity is three
months or less and other short term highly liquid investments that are readily convertible into cash and which are subject to an
insignificant risk of changes in value. Bank overdrafts are included as a component of cash and cash equivalent for the purpose of
statement of cash flow.

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Mar 31, 2024

1 Corporate and General Information

Shreyans Industries Limited (“the Company”) (CIN- L17115PB1979PLC003994) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956.The name of the company at its incorporation was Shreyans Paper Mills Ltd. and subsequently changed to Shreyans Industries Limited on 20th October 1992. The registered office of the company is situated at Village Bholapur, P.O. Sahabana, Chandigarh Road, Ludhiana-141123, Punjab.

The company is engaged in the manufacturing of Writing and Printing Paper. The Company caters to both domestic and international market. The equity shares of the Company are listed on National Stock Exchange of India Ltd (NSE) and Bombay Stock Exchange Limited (BSE).

The Board of Directors approved the Financial Statements for the year ended 31st March, 2024 and authorised for issue on 10th May 2024.

2 Material Accounting policies, Significant accounting judgements, estimates and assumptions and applicability of new and revised Ind AS

2.1 Statement of Compliance

The financial statements have been prepared in accordance with Indian Accounting Standards (Referred to as Ind AS) as prescribed under Section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time and other relevant provisions of the Act.

2.2 Basis of preparation and presentation of financial statements

(i) The financial statements have been prepared on a historical cost convention and on the accrual basis except for certain financial instruments which are measured at fair value at the end of each reporting period as required under Ind AS.

The following assets and liabilities which have been measured at fair value:

- Derivative financial instruments

- Certain financial assets and liabilities measured at fair value.

Historical Cost

Historical cost is based on the fair value of the consideration given in exchange of goods and services.

Fair Value Measurement

The Company measures financial instruments at fair value at each balance sheet date.

Fair value is the price 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 fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

- In the principal market for the asset or liability or

- In the absence of a principal market, in the most advantageous market for the asset or liability

A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Entity uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

- Level 1 : Quoted (unadjusted) market prices in active markets for identical assets or liabilities

- Level 2 : Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or

indirectly observable

- Level 3 : Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and the risks of the asset or liability and the level of the fair value hierarchy as explained above.

(ii) Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

(iii) Functional and Presentation currency

The financial statements are presented in Indian rupees (INR, which is company''s functional currency) and All amounts have been rounded off to the nearest F lakhs and two decimals thereof, unless otherwise indicated.

2.3 Material accounting policies

a) Revenue Recognition Revenue

Revenue towards satisfaction of performance obligation is measured at the amount of transaction price allocated to that performance obligation. The transaction price of goods sold is net of variable consideration on account of various discounts and

schemes offered by the company as a part of the contract.

i) Sale of products

The company derives revenue primarily from the sale of Writing and Printing Paper and Soda Ash.

Revenue from the sale of goods is recognized at the point in time when control is transferred to the customer which is usually on dispatch/ delivery.

Revenue is measured based on the transaction price (net of variable consideration) which is consideration, adjusted for volume discounts, rebates, scheme allowances, price concessions, incentives, and returns, if any, as specified in the contracts with the customers.

Revenue excludes taxes collected from customers on behalf of the government.

Due to the short nature of credit period given to customers, there is no financing component in the contract.

ii) Interest income

- Interest Income from customers is recognized on a time proportionate basis taking into account the amount outstanding and the interest rate applicable.

- Interest Income from financial asset is recognized when it is probable that economic benefits will flow to the company and amount of income can be measured reliably. Interest income is accrued on time basis, by reference to principal outstanding and at effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of financial asset to that asset’s net carrying amount on initial recognition.

iii) Dividend income

Dividend income from investment is recognized when the right to receive the payment is established by the reporting date and amount of dividend can be measured reliably, the dividend does not represent a recovery of part of cost of the investment.

iv) Insurance and Other Claims

Insurance claims are recognized when no significant uncertainty exists with regard to the amount to be realized and the ultimate collection thereof.

b) Employee Benefits

i) Short Term Employee benefit:

The short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised on an undiscounted accrual basis during the year when the employees render the services. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related services.

Post Employment Benefit Plan

ii) Defined Contribution plan Provident Fund:

Employees receive benefit in the form of Provident fund which is a defined contribution plan. The company has no obligation, other than the contribution payable to the provident fund. The company recognises contribution payable to the provident fund scheme as an expense, when an employee renders the related service.

iii) Defined Benefit Plan Gratuity:

The Company provides for gratuity, a defined benefit retirement plan “The gratuity plan” covering eligible employees. The gratuity plan provides for lump sum payment to vested employee at retirement, death, incapacitation or termination of employee of an amount based on the respective employees’ salary and the tenure of employment with the company.

Payments to defined contribution retirement benefit plans are recognised as an expense when employees have rendered service entitling them to the contributions.

For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each balance sheet date. Re-measurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest), is reflected in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Remeasurement recognised in other comprehensive income is reflected in retained earnings and is not reclassified to profit or loss. Past service cost is recognised in profit or loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorised as follows:

a. service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

b. net interest expense or income; and

c. re-measurement

The Company presents the first two components of defined benefit costs in profit or loss in the line item ’Employee benefits expense’. Curtailment gains and losses are accounted for as past service costs.

The retirement benefit obligation recognised in the balance sheet represents the actual deficit or surplus in the Company’s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.

A liability for a termination benefit is recognised at the earlier of when the entity can no longer withdraw the offer of the termination benefit and when the entity recognises any related restructuring costs.

iv) Other long term employee benefit Compensated absences:

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as a liability in respect of other long-term employee benefits and measured at the present value of the estimated future cash outflows expected to be made by the Company in respect of services provided by employees up to the reporting date.

c) Property, Plant and Equipment

a) Freehold land is stated at historical cost and not depreciated. All other items of property, plant and equipment are stated at cost or deemed cost applied on transition to Ind AS, less accumulated depreciation and impairment, if any.

b) On transition to Ind As, the company has elected to continue with the carrying value of all its Property, plant & equipment and Intangible assets recognised as at 1st April, 2016 measured as per previous GAAP and used that carrying value as it’s deemed cost of it’s Property, plant & equipment and Intangible assets.

c) The Cost of an item of Property, Plant and Equipment comprises its purchase price net of recoverable taxes where applicable and any attributable expenditure (directly or indirectly) for bringing the asset to its working condition for its intended use and the borrowing costs for qualifying assets and the initial estimate of restoration cost if the recognition criteria are met. the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which an entity incurs either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period. When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives.

An item of Property, Plant and Equipment and any significant part initially recognized is derecognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on derecognition of the asset measured as the difference between the net disposal proceeds and the carrying amount of the asset is included in the statement of Profit and loss when the asset is derecognized.

The depreciation method, useful lives and residual value are reviewed periodically and at the end of each reporting period. The company depreciates property, plant and equipment over their estimated useful lives using the straight-line method. The estimated useful lives of assets as prescribed under Part C of Schedule II of the Companies Act 2013 except the assets costing Rs 5000/- or below on which deprecation is charged @ 100% per annum on proportionate basis, are as follows:

Building - 30-60 years

Plant and Machinery - 15-25 years

Office Equipment - 05 years

Computer Equipment - 03 years

Furniture and fittings - 10 years

Vehicles excluding Motor cycles - 08 years

Motor cycles - 10 years

Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as capital advances under other non-current assets. Capital work in Progress includes assets not ready for their intended use and includes related incidental expenses.

Subsequent expenditures relating to property, plant and equipment is capitalized only when it is probable that future economic benefits associated with these will flow to the Company and the cost of the item can be measured reliably. Repairs and maintenance costs are recognized as expense in the Statement of Profit and Loss as and when incurred.

The cost and related accumulated depreciation are eliminated from the financial statements upon sale or retirement of the asset and the resultant gains or losses are recognized in the statement of profit and loss.

Depreciation is recognised so as to write off the cost of assets (other than freehold land and properties under construction) less their residual values over their useful lives, using the straight-line method.

d) Intangible assets

Intangible assets with finite useful lives that are acquired separately are stated at cost less accumulated amortisation and accumulated impairment losses, if any. Amortisation is recognised on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired separately are carried at cost less accumulated impairment losses.

An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognised in the statement of profit and loss when the asset is derecognised.

Estimated useful lives of the intangible assets are as follows:

Computer Softwares 6 Years

e) Impairment of property, plant and equipment and Intangible assets

Property, plant and equipment and intangible assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the CGU (Cash Generating unit) to which the asset belongs.

If such assets are considered to be impaired, the impairment to be recognized in the statement of profit and loss is measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount of the asset. An impairment loss is reversed in the statement of profit and loss if there has been a change in the estimates used to determine the recoverable amount. The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated depreciation) had no impairment loss been recognized for the asset in prior years.

Impairment is reviewed periodically, including at each financial year end.

f) Inventories

Inventories of raw materials, stores and spares, work-in-progress and finished goods are valued at cost or net realisable value, whichever is lower. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. The cost in respect of the aforesaid items of inventory is computed as under:

- In case of raw materials, at first in first out cost plus direct expenses.

- In case of stores and spares, at weighted average cost plus direct expenses.

- In case of work-in-progress, at material cost plus conversion cost depending upon the stage of completion.

- In case of finished goods, at material cost plus conversion cost, packing cost and other overheads incurred to bring the goods to their present condition and location.

- In Case of Material in Transit, Actual cost plus direct expenses to the extent incurred.

Net realizable value is the estimated selling price in ordinary course of business less estimated costs of completion and the estimated costs necessary to make the sale.

g) Government Grants

(i) The government grants are recognized only when there is reasonable assurance that the conditions attached to them will be complied with, and the grants will be received.

(ii) Government grants in relation to fixed assets are treated as deferred income and are recognized in the statement of profit and loss on a systematic and rational basis over the useful life of the asset.

(iii) Government grants related to revenue are recognized on a systematic basis in the statement of profit and loss over the period necessary to match them with the related costs that they are intended to compensate.

(iv) Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the company with no future related costs are recognized in the Statement of profit and loss in the period in which they become receivable.

(v) Export benefits are accounted for in the year of exports based on eligibility and when there is no uncertainty in receiving the same.

h) Borrowing costs

Borrowing costs that are directly attributable to the acquisition or construction of items of Property, plant and equipment which necessarily takes substantial period of time to get ready for their intended use are capitalized as part of the cost of the asset. Other borrowing costs are recognized as an expense in the period in which they are incurred. Borrowing cost also includes exchange differences arising from foreign currency borrowings to the extent regarded as an adjustment to the interest costs.

i) Leases

The Company as a lessee

The Company’s lease asset classes primarily consist of leases for land and office building. The Company assesses whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether: (i) the contract involves the use of an identified asset (ii) the Company has substantially all of the economic benefits from use of the asset through the period of the lease and (iii) the Company has the right to direct the use of the asset.

At the date of commencement of the lease, the Company recognizes a right-of-use asset (“ROU”) and a corresponding lease liability, except for leases with a term of twelve months or less (short-term leases) and leases for which underlying asset is of low value. For these short-term and leases for which underlying asset is of low value, the Company recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any lease

payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease incentives. They are subsequently measured at cost less accumulated depreciation and impairment losses.

Right-of-use assets is subsequently depreciated from the commencement date on a straight-line basis over the shorter of the lease term or useful life of the underlying asset. Right of use assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs.

The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, using the company’s incremental borrowing rate.

Lease liabilities are remeasured with a corresponding adjustment to the related right of use asset if the Company changes its assessment if whether it will exercise an extension or a termination option.

The Company as a lessor

Leases for which the company is a lessor is classified as a finance or operating lease. Whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases.

For operating leases, rental income is recognized on a straight line basis over the term of the relevant lease.

j) Foreign currency transactions Transaction and balances

Foreign currency transactions are initially recorded, on initial recognition in the functional currency, by applying to the foreign currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction. Monetary items denominated in foreign currency are recognised using the closing exchange rate as on balance sheet date.

The non-monetary items that are measured in terms of historical cost in foreign currency are not retranslated.

Exchange differences arising on the settlement of monetary items or on reporting of monetary items at rates different from rates at which these were recognised on initial recognition during the period or reported in previous financial statements are recognised in the statement of Profit and Loss in the period in which they arise. All foreign exchange gains and losses are presented in the statement of profit and loss on net basis.

k) Accounting for Taxes on income

i. Income tax expense comprises of current and deferred tax. Income tax expense is recognized in the statement of profit and loss except to when it relates to items recognized directly in equity or items recognised in other comprehensive income in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively.

ii. Current income tax for current period is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

iii. Deferred tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.

iv. Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred tax assets and liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date.

v. A deferred tax asset is recognized to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences and tax losses can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized. Deferred tax assets and deferred tax liabilities have been offset as they are governed by the same taxation laws.

vi. The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

l) Earnings per share

Basic earnings per equity share are computed by dividing the net profit attributable to the equity holders of the Company by the weighted average number of equity shares outstanding during the period. Diluted earnings per equity share is computed by dividing the net profit attributable to the equity holders of the Company by the weighted average number of equity shares considered for deriving basic earnings per equity share and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares. The dilutive potential equity shares are adjusted for the proceeds receivable had the equity shares been actually issued at fair value (i.e. the average market value of the outstanding equity shares). Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented.

m) 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. Company is required to pay / distribute dividend after deducting applicable taxes.

The Company incurred a cash outflow of F691.23 lakhs during the year ended 31st March, 2024, on account of the final dividend for fiscal 2023. The Board of Directors recommended a final dividend of F3.00 per equity share and special dividend of F2.00 per equity share for the financial year ended 31st March 2024. This payment is subject to the approval of shareholders in the ensuing Annual General Meeting of the Company and if approved, would result in a cash outflow of approximately F691.23 lakhs.

n) Financial Instruments

i) Initial Recognition and measurement

Financial assets and financial liability are recognised when the company entity becomes a party to the contractual provisions of the instruments.

All financial assets and liabilities are initially recognized at fair value plus or minus transaction cost that are directly attributable to the acquisition or issue of financial asset or financial liability on initial recognition. However, trade receivables that do not contain a significant financing component are measured at transaction price.

T ransaction cost that are directly attributable to the acquisition of financial assets and financial liabilities that are carried at fair value through profit or loss are immediately recognized in the statement of profit and loss.

ii) Subsequent measurement A) Financial assets

All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace.

All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair value, depending on the classification of the financial assets > Non-derivative financial instruments

1. Financial assets carried at amortised cost

A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

2. Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Interest income is recognised in profit or loss for instruments measured at Fair value through other comprehensive income (FVTOCI). All other financial assets are subsequently measured at fair value.

Effective interest method

The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition.

Income is recognised on an effective interest basis for debt instruments other than those financial assets classified as at FVTPL. Interest income is recognised in profit or loss and is included in the “Other income” line item.

3. Investment in Equity Instruments measured at fair value through OCI

On initial recognition, the company can make an irrevocable election for its investment which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. These elected investments are initially measured at fair value plus transaction cost, subsequently there are measured at fair value with gains and losses arising from changes in fair value recognized in Other Comprehensive Income and accumulated in the Reserve for equity instruments through Other Comprehensive Income. The cumulative gain or loss is not reclassified to the statement of profit and loss on disposal of the investments.

- The above election is not permitted if the equity investment is held for trading.

Dividend on these investments in equity instruments are recognised in the Statement of profit and loss when the Company’s right to receive the dividends is established, it is probable that the economic benefits associated with the dividend will flow to the entity, the dividend does not represent a recovery of part of cost of the investment and the amount of dividend can be measured reliably. Dividends recognized in the statement of profit and loss are included in ’other income’ line item.

4. Financial assets at fair value through profit or loss

A financial asset which is not classified in any of the above categories is subsequently measured at fair valued through profit or loss. Debt instruments that meet the amortised cost criteria or the fair value through other comprehensive income but are designated as fair value through profit or loss are measured at FVTPL.

5. Impairment of financial assets

The Company applies the expected credit loss model for recognising impairment loss on financial assets measured at

amortised cost, debt instruments at FVTOCI, lease receivables, trade receivables, other contractual rights to receive cash or other financial asset not designated as at FVTPL.

Expected credit losses are the weighted average of credit losses with the respective risks of default occurring as the weights. Credit loss is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the Company expects to receive (i.e. all cash shortfalls), discounted at the original effective interest rate (or credit-adjusted effective interest rate for purchased or originated credit-impaired financial assets). The Company estimates cash flows by considering all contractual terms of the financial instrument (for example, prepayment, extension, call and similar options) through the expected life of that financial instrument.

When making the assessment of whether there has been a significant increase in credit risk since initial recognition, the Company uses the change in the risk of a default occurring over the expected life of the financial instrument instead of the change in the amount of expected credit losses. To make that assessment, the Company compares the risk of a default occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial instrument as at the date of initial recognition and considers reasonable and supportable information, that is available without undue cost or effort, that is indicative of significant increases in credit risk since initial recognition.

For trade receivables or any contractual right to receive cash or another financial asset that result from transactions that are within the scope of Ind AS 115, the Company always measures the loss allowance at an amount equal to lifetime expected credit losses.

Further, for the purpose of measuring lifetime expected credit loss allowance for trade receivables, the Company has used a practical expedient as permitted under Ind AS 109. The Company follows simplified approach for recognition of impairment loss allowance on trade receivables. The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECL’s at each reporting date, right from its initial recognition.

The impairment requirements for the recognition and measurement of a loss allowance are equally applied to debt instruments at FVTOCI except that the loss allowance is recognised in other comprehensive income and is not reduced from the carrying amount in the balance sheet.

6. De-recognition of Financial Assets

The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Company neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Company recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.

On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in profit or loss if such gain or loss would have otherwise been recognised in profit or loss on disposal of that financial asset.

On derecognition of a financial asset other than in its entirety (e.g. when the Company retains an option to repurchase part of a transferred asset), the Company allocates the previous carrying amount of the financial asset between the part it continues to recognise under continuing involvement, and the part it no longer recognises on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognised and the sum of the consideration received for the part no longer recognised and any cumulative gain or loss allocated to it that had been recognised in other comprehensive income is recognised in profit or loss if such gain or loss would have otherwise been recognised in profit or loss on disposal of that financial asset. A cumulative gain or loss that had been recognised in other comprehensive income is allocated between the part that continues to be recognised and the part that is no longer recognised on the basis of the relative fair values of those parts.

7. Foreign Exchange Gains and Losses

The fair value of financial assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate at the end of each reporting period.

For foreign currency denominated financial assets measured at amortised cost and FVTPL, the exchange differences are recognised in profit or loss.

> Derivative financial instruments

The Company enters into derivative financial instruments to manage its exposure to foreign exchange rate risks and to manage its exposure to imported raw material price risk including foreign exchange forward contracts and commodities future contracts. Derivatives are initially recognised at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedging relationship and the nature of the hedged item.

B. Financial liabilities

The financial liabilities are subsequently carried at amortized cost using the effective interest method.

1. Financial Liability at fair value through Profit or Loss

Financial liabilities are classified as at FVTPL when the financial liability is either contingent consideration recognised by the Company as an acquirer in a business combination to which Ind AS 103 applies or is held for trading or it is designated as at FVTPL

A financial liability is classified as held for trading if:

a. it has been incurred principally for the purpose of repurchasing it in the near term; or

b. on initial recognition it is part of a portfolio of identified financial instruments that the Company manages together and has a recent actual pattern of short-term profit-taking; orc. it is a derivative that is not designated and effective as a hedging instrument.

2. Financial Liabilities Subsequently measured at Amortised Cost

Financial liabilities that are not held-for-trading and are not designated as at FVTPL are measured at amortised cost at the end of subsequent accounting periods. The carrying amounts of financial liabilities that are subsequently measured at amortised cost are determined based on the effective interest method. Interest expense that is not capitalised as part of costs of an asset is included in the ’Finance costs’ line item.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

3. De-recognition of Financial Liablities

The Company derecognises financial liabilities when, and only when, the Company’s obligations are discharged, cancelled or have expired. An exchange between with a lender of debt instruments with substantially different terms is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. Similarly, a substantial modification of the terms of an existing financial liability (whether or not attributable to the financial difficulty of the debtor) is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in profit or loss.

> Cash Flow Hedge

The Company has not designated derivative financial instruments as cash flow hedges.

> Equity Instruments:

Equity instrument are any contract that evidences a residual interest in the assets of an equity after deducting all of its liabilities.

Debt or equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

> Ordinary Shares

Equity shares issued by the company are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares and share options are recognized as a deduction from equity, net of any tax effects.

o) Segment reporting

An operating segment is a component of the company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the company’s other components, and for which discrete financial information is available. Segments are identified based on the manner in which the Company’s Chief Operating Decision Maker (’CODM’) decides about resource allocation and reviews performance.

p) Cash flow statement

The Cash flows are reported using the indirect method, whereby profit for the year is adjusted for the effects of transactions of a noncash nature and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the Company are segregated. The Company considers all highly liquid investments that are readily convertible to known amounts of cash to be cash equivalents.

q) Cash and cash equivalent

Cash and cash equivalent for the purpose of statement of cash flows include bank balances, where the original maturity is three months or less and other short term highly liquid investments that are readily convertible into cash and which are subject to an insignificant risk of changes in value. Bank overdrafts are included as a component of cash and cash equivalent for the purpose of statement of cash flow.

r) Provisions and Contingent Liabilities (A) Provisions

- Provisions are recognized if, as a result of past event, the company has a present obligation (legal or constructive), and it is probable that a cash outflow will be required to settle the obligation in respect of where a reliable estimate can be made.

- As the timing of outflows of resources is uncertain, being dependent upon the outcome of the future proceedings, these provisions are not discounted to their present value.

- When some or all of economics benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognized as on asset if it is virtually certain that reimbursements will be received and amount of the receivable can be measured reliably.

(B) Contingent liability

- A disclosure for contingent liability is made when is a possible obligation or a present obligation that may, but probably will not require an outflow of resources.

- When there is possible obligation or a present obligation where the like hood of an outflow of resources is remote no provision or disclosure is made.

Commitments include the amount of purchase order (net of advances) issued to parties for completion of assets.

Contingent assets are neither recognized nor disclosed in the financial statements Provisions, contingent liabilities, and commitments are reviewed at each balance sheet date

2.4 Use of Significant accounting judgements and estimates

The preparation of the financial statements in conformity with Indian Accounting Standards (Ind AS) require management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amount of revenues, expenses, assets and liabilities and disclosure of contingent liabilities at the date of the financial statement and reported amount of revenue and expense during the period.

Although these estimates are based upon management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcome requiring a material adjustment to the carrying amount of assets or liabilities in future period. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only the period of the revision and future periods if the revision affects both current and future periods.

The following are the areas of estimation uncertainty and critical judgements that the management has made in the process of applying the Company''s accounting policies and that have the most significant effect on the amounts recognised in the financial statements:

i) Useful lives of property, plant and equipment

The estimated useful lives of property, plant and equipment are based on a number of factors including the effects of obsolescence, internal assessment of user experience and other economic factors (such as the stability of the industry, and known technological advances) and the level of maintenance expenditure required to obtain the expected future cash flows from the asset.

The Company reviews the useful life of property, plant and equipment at the end of each reporting date.

ii) Recoverable amount of property, plant and equipment

The recoverable amount of property plant and equipment is based on estimates and assumptions regarding the expected market outlook and expected future cash flows. Any changes in these assumptions may have a material impact on the measurement of the recoverable amount and could result in impairment.

iii) Defined benefit plans

The cost of the defined benefit plan and other post-employment benefits and the present value of such obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future, salary increases, mortality rates and future pension increases. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

iv) Recognition of deferred tax assets

Management judgement is required for the calculation of provision for income taxes and deferred tax assets and liabilities. The company reviews at each balance sheet date the carrying amount of deferred tax assets. The factors used in estimates may differ from actual outcome which could lead to signification adjustment to the amounts reported in financial statement.

v) Contingencies

Management judgement is required for estimating the possible outflow of resources, if any, in respect of contingencies/claims/litigations against the Company as it is not possible to predict the outcome of pending matters with accuracy. The Company annually assesses such claims and monitors the legal environment on an ongoing basis, with the assistance of external legal counsel, wherever necessary.

vi) Fair value measurement

Some of the Company''s assets and liabilities are measured at fair value for financial reporting purposes. The Board of Directors of the Company approves the fair values determined by the Chief Financial Officer of the Company including determining the appropriate valuation techniques and inputs for fair value measurements.

In estimating the fair value of an asset or liability, the Company uses market-observable data to the extent is available. Where Level 1 inputs are not available, the Company engages third party qualified valuers to perform the valuation. The Chief financial officer works closely with the qualified external valuers to establish appropriate valuation techniques and inputs to the model.

vii) Income Tax

The Company''s tax jurisdiction is India. Significant judgements are involved in determining the provision for income taxes including judgement on whether tax positions are probable of being sustained in tax assessments. A tax assessment can involve complex issues, which can only be resolved over extended time periods.

viii) Inventory

Management has carefully estimated the net realizable values of inventories, taking into account the most reliable evidence available at each reporting date. The future realization of these inventories may be affected by market driven changes

2.5 Current - non-current classification

All assets and liabilities have been classified as current and non-current on the basis of the following criteria:

Assets

An asset is classified as current when it satisfies any of the following criteria:

a) it is expected to be realised in, or is intended for sale or consumption in, the company''s normal operating cycle;

b) it is held primarily for the purpose of being traded;

c) it is expected to be realised within 12 months after the reporting date; or

d) it is cash or cash equivalent unless it is restricted from being exchanged or use to settle a liability for at least 12 months after the reporting date.

Current assets include the current portion of non-current financial assets.

All other assets are classified as non-current.

Liabilities

A liability is classified as current when it satisfies any of the following criteria:

a) it is expected to be settled in the company''s normal operating cycle;

b) it is held primarily for the purpose of being traded;

c) it is due to be settled within 12 months after the reporting date; or

d) The Company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Terms of a liability that could, at the option of the counterpart, result in its settlement by the issue of equity instruments do not affect its classification.

Current liabilities include current portion of non-current financial liabilities.

All other liabilities are classified as non-current Operating cycle

Operating cycle is the time between the acquisition of assets for processing/servicing and their realization in cash or cash equivalents.

2.6 Applicability of new and revised IND AS

Ministry of Corporate Affairs (“MCA”) notifies new accounting standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended 31stMarch , 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.

In the current year, the Company has applied the below amendments to Ind ASs that are effective for an annual period that begins on or after 1 April 2023.

1) The Company has adopted the amendments to Ind AS 1 - Presentation of Financial Statements for the first time in the current year. The amendments change the requirements in Ind AS 1 with regard to disclosure of accounting policies. The amendments replace all instances of the term ''significant accounting policies'' with ''material accounting policy information''. Accounting policy information is material if, when considered together with other information included in an entity''s financial statements, it can reasonably be expected to influence decisions that the primary users of general-purpose financial statements make on the basis of those financial statements.

The supporting paragraphs in Ind AS 1 are also amended to clarify that accounting policy information that relates to immaterial transactions, other events or conditions is immaterial and need not be disclosed. Accounting policy information may be material because of the nature of the related transactions, other events or conditions, even if the amounts are immaterial. However, not all accounting policy information relating to material transactions, other events or conditions is itself material.

2) The Company has adopted the amendments to Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors -Definition of Accounting Estimates for the first time in the current year. The amendments replace the definition of a change in accounting estimates with a definition of accounting estimates. Under the new definition, accounting estimates are “monetary amounts in financial statements that are subject to measurement uncertainty”. The definition of a change in accounting estimates was deleted.

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Mar 31, 2021

1 Corporate and General Information

Shreyans Industries Limited (“the Company”) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956.The name of the company at its incorporation was Shreyans Paper Mills Ltd. and subsequently changed to Shreyans Industries Limited on 20th October 1992. The registered office of the company is situated at Village Bholapur, P.O. Sahabana, Chandigarh Road, Ludhiana-141123, Punjab.

The company is engaged in the manufacturing of Writing and Printing Paper. The Company caters to both domestic and international market. The equity shares of the Company are listed on National Stock Exchange of India Ltd (NSE) and Bombay Stock Exchange Limited (BSE).

The Board of Directors approved the Financial Statements for the year ended 31st March, 2021 and authorised for issue on 11th May, 2021.

2 Significant accounting policies, significant accounting judgements, estimates and assumptions and applicability of new and revised Ind AS

Significant Accounting Policies

2.1 Statement of Compliance

The financial statements have been prepared in accordance with Indian Accounting Standards and the provisions of the Companies Act, 2013 (’the Act’) to the extent notified and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules issued thereafter.

2.2 Basis of preparation of financial statements

The financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) under the historical cost convention on accrual basis except for certain financial assets and liabilities (including derivative instruments) which are measured at fair value.

The following assets and liabilities which have been measured at fair value:

- Derivative financial instruments

- Certain financial assets and liabilities measured at fair value.

Historical Cost

Historical cost is based on the fair value of the consideration given in exchange of goods and services.

Fair Value Measurement

The Company measures financial instruments at fair value at each balance sheet date.

Fair value is the price 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 fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

- In the principal market for the asset or liability or

- In the absence of a principal market, in the most advantageous market for the asset or liability

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Entity uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

- Level 1 : Quoted (unadjusted) market prices in active markets for identical assets or liabilities

- Level 2 : Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or

indirectly observable

- Level 3 : Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and the risks of the asset or liability and the level of the fair value hierarchy as explained above.

Accounting policies have been consistently applied except where in newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

Functional and Presentation currency

The functional currency of the Company is the Indian rupee. These financial statements are presented in Indian rupees. All amounts have been rounded-off to the nearest lakhs, up to two places of decimal, unless otherwise indicated.

2.3 Significant accounting policies

a) Revenue Recognition

The Company derives revenue primarily from sale of Writing and Printing Paper and Soda Ash (from chemical recovery).

Effective April 1,2018, the Company adopted Ind AS 115 ‘Revenue from Contracts with Customers''. First time adoption has been conducted retrospectively with cumulative effect of initially applying this standard as on the transition date. The effect on the transition to Ind AS 115 was significant.

Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for returns, discounts, value added taxes and amounts collected on behalf of third parties.

Revenue from the sale of goods is recognised at the point in time when control of goods are transferred to the customer which is usually on dispatch / delivery.

i) Sale of Writing and Printing Paper and Soda Ash

Revenue is recognized as and when Writing and Printing Paper and Soda Ash is sold. Revenue from the sale of Writing and Printing Paper , Soda Ash and Traded Goods is recognised when control of the goods is passed to the buyer i.e. at the point of sale / delivery to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. Sale is net of sales returns, discounts and goods and services tax.

ii) Export Incentives

The revenue in respect of export benefits is recognised on post export basis and it is reasonable to expect ultimate collection.

iii) Dividend

Dividend Income from investments is recognized when the right to receive the payment is established and amount of dividend can be measured reliably.

iv) Interest

Interest from customer

Interest income is recognised on a time proportion basis taking into account the amount outstanding and the applicable interest rate.

Other Interest

Interest income is recognised using effective interest rate (EIR).

v) Insurance and other claims

Insurance and other claims are recognized when there exist no significant uncertainty with regard to the amount to be realized and the ultimate collection thereof.

b) Employee Benefits

i) Short Term Employee benefit:

The short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised on an undiscounted accrual basis during the year when the employees render the services. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related services.

Post Employment Plan

ii) Defined Contribution plan Provident Fund:

Employees receive benefit in the form of Provident fund which is a defined contribution plan. The company has no obligation, other than the contribution payable to the provident fund. The company recognises contribution payable to the provident fund scheme as an expense, when an employee renders the related service.

iii) Defined Benefit Plan Gratuity:

The Company provides for gratuity, a defined benefit retirement plan “The gratuity plan” covering eligible employees. The gratuity plan provides for lump sum payment to vested employee at retirement, death, incapacitation or termination of employee of an amount based on the respective employees'' salary and the tenure of employment with the company.

Liability with regard to Gratuity Plan is determined by actuarial valuation, performed by an independent actuary at each Balance sheet date using the project unit credit method.

The company fully contributes all ascertained liabilities to the SIL-Group Gratuity Trust. Trustees administer contributions made to the trust and Contributions are invested in a scheme with Life Insurance Corporation of India as permitted by Indian Law.

The Company recognises the net obligation of a defined plan in its Balance Sheet as an asset or liability. Re-measurements comprising of actuarial gains and losses, the effect of the asset ceiling (excluding amounts included in net interest on the net defined benefit liability) and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability) are recognised in Other Comprehensive Income which are not reclassified to profit or loss in subsequent periods. All other expenses related to defined benefit plans are recognised in employee benefits expense in the Statement of profit and loss.

iv) Other long term employee benefit Compensated absences:

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as a liability at the present value of the defined benefit obligation at the Balance Sheet date. The cost of providing benefits is determined using projected unit credit method, with actuarial valuations being carried out at each Balance Sheet date. Actuarial gain /loss are recognised in the statement of profit or loss in the period in which they occur.

c) Property, Plant and Equipment

Freehold land is stated at cost and not depreciated. All other items of Property, plant and equipment are stated at cost less accumulated depreciation and impairment if any. The Cost of an item of Property, Plant and Equipment comprises:

a) its purchase price net of recoverable taxes where applicable and any attributable expenditure (directly or indirectly) for bringing the asset to its working condition for its intended use.

b) Subsequent expenditures relating to property, plant and equipment is capitalized only when it is probable that future economic benefits associated with these will flow to the Company and the cost of the item can be measured reliably. Repairs and maintenance costs are recognized in net profit in the Statement of Profit and Loss when incurred.

c) Initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, if any, the obligation for which an entity incurs either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period.

The company depreciates property, plant and equipment over their estimated useful lives using the straight-line method. The estimated useful lives of assets as prescribed under Part C of Schedule II of the Companies Act 2013 except the assets costing F5000/- or below on which deprecation is charged @ 100% per annum on proportionate basis, are as follows:

Building - 30-60 years

Plant and Machinery - 15-25 years

Office Equipment - 5 years

Computer Equipment - 3 years

Furniture and fittings - 10 years

Vehicles excluding Motor cycles - 08 years

Motor cycles - 10 years

On transition to Ind-AS, the company has elected to continue with the carrying value of all the property, plant and equipment recognised as at 01 April,2016, measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment.

Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as capital advances under other non-current assets and the cost of assets not put to use before such date are disclosed under ’Capital work-in-progress’. The depreciation method, useful lives and residual value are reviewed periodically and at the end of each reporting period.

The cost and related accumulated depreciation are eliminated from the financial statements upon sale or retirement of the asset and the resultant gains or losses are recognized in the statement of profit and loss. Assets to be disposed off are reported at the lower of the carrying value or the fair value less cost to sell.

d) Intangible assets

Intangible assets are stated at cost less accumulated amount of amortisation and impairment if any. Cost includes purchase price and all other direct expenses incurred to make the intangible asset ready for its intended use. Intangible assets are amortised over their respective individual estimated useful lives on a straight line basis, from the date that they are available for use. The estimated useful life of an identifiable intangible asset is based on a number of factors including the effects of obsolescence etc. The amortization method, estimated useful lives are reviewed periodically and at end of each reporting period.

Intangible assets (Software) have been amortised on estimated useful life of six years.

e) Impairment of property, plant and equipment and Intangible assets

Property, plant and equipment and intangible assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the CGU (Cash Generating unit) to which the asset belongs.

If such assets are considered to be impaired, the impairment to be recognized in the statement of profit and loss is measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount of the asset. An impairment loss is reversed in the statement of profit and loss if there has been a change in the estimates used to determine the recoverable amount. The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated depreciation) had no impairment loss been recognized for the asset in prior years.

Impairment is reviewed periodically, including at each financial year end.

f) Inventories

Inventories of raw materials, stores and spares, work-in-progress and finished goods are valued at cost or net realisable value whichever is lower. The cost in respect of various items of inventories is computed as under:

a) Raw Material and Components First in First out method plus direct expenses

b) Stores and Spares Weighted average method plus direct expenses

c) Work-in-progress Cost of material plus Conversion cost depending upon the stage of completion.

d) Finished Goods Cost of material plus conversion cost, packing cost, and other overheads

incurred to bring the goods to their present conditions and location.

e) Material in Transit Actual cost plus direct expenses to the extent incurred.

Net Realisable Value is the estimated selling price in ordinary course of business,less estimated cost of completion and estimated cost necessary to make the sales.

g) Government Grants

The government grants are recognised only when there is a reasonable assurance of compliance that conditions attached to such grants shall be complied with and it is reasonably certain that the ultimate collection will be made.

Government grants related to revenue are recognised on a systematic basis in the statement of profit and loss over the periods necessary to match them with the related costs which they are intended to compensate.

Consequent to the amendment in Ind-AS 20 "Government Grants" w.e.f April 1,2018, the Company has opted to continue and treat ’Government grant in relation to Property, plant and equipment’ as deferred income and the same is recognised in the statement of profit and loss on a systematic basis over the useful life of the asset.

h) Borrowing costs

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are capitalised as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expenditure in the period in which these are incurred. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange difference to the extent regarded as an adjustment to the borrowing cost.

i) Leases

Policy applicable before April 1,2019

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

The Company as lessee

Rental expense from operating leases is generally recognised on a straight-line basis over the term of the relevant lease. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases, such increases are recognised in the year in which such benefits accrue The Company as lessor

Rental income from operating leases is generally recognised on a straight-line basis over the term of the relevant lease. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the Company’s expected inflationary cost increases, such increases are recognised in the year in which such benefits accrue.

Policy applicable after April 1,2019 The Company as a lessee

Effective April 1,2019, the Company has adopted Ind AS 116 "Leases", applied to lease contracts existing on April 1,2019’ using the modified retrospective method along with the transition option to recognise Right-of-Use asset (ROU) at an amount equal to the lease liability. In respect of all Operating leases ending within 12 months of the date of initial application, the company has elected to account for such leases as short term lease and has recognised the lease payments as rental expense.

The Company’s lease asset classes primarily consist of leases for land and office building. The Company assesses whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether: (i) the contract involves the use of an identified asset (ii) the Company has substantially all of the economic benefits from use of the asset through the period of the lease and (iii) the Company has the right to direct the use of the asset.

At the date of commencement of the lease, the Company recognizes a right-of-use asset (“ROU”) and a corresponding lease liability for all lease arrangements in which it is a lessee, except for leases with a term of twelve months or less (short-term leases) and leases for which underlying asset is of low value. For these short-term and leases for which underlying asset is of low value, the Company recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease incentives. They are subsequently measured at cost less accumulated depreciation and impairment losses.

Right-of-use assets are depreciated from the commencement date on a straight-line basis over the shorter of the lease term and useful life of the underlying asset. Right of use assets are evaluated for recoverability whenever events or changes in

circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs.

The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, using the lessee’s incremental borrowing rate. Lease liabilities are remeasured with a corresponding adjustment to the related right of use asset if the Company changes its assessment if whether it will exercise an extension or a termination option.

The Company as a lessor

Leases for which the company is a lessor is classified as a finance or operating lease. Whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases.

For operating leases, rental income is recognized on a straight line basis over the term of the relevant lease.

j) Foreign currency transactions Transaction and balances

Transactions in foreign currency are initially recorded, on initial recognition in the functional currency, by applying to the foreign currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction. Monetary items denominated in foreign currency are recognised using the closing exchange rate as on balance sheet date.

The non-monetary items that are measured in terms of historical cost in foreign currency are not retranslated.

Exchange differences arising on the settlement of monetary items or on reporting of monetary items at rates different from rates at which these were recognised on initial recognition during the period or reported in previous financial statements as recognised in the statement of profit or loss in the period in which they arise.

Foreign exchange differences regarded as an adjustment to borrowing costs are presented in the statements of profit and loss, within finance cost. All other foreign exchange gains and losses are presented in the statement of profit and loss on net basis.

k) Accounting for Taxes on income

Income tax expense comprises of current and deferred tax. Income tax expense is recognized in the statement of profit and loss except to when it relates to items recognized directly in equity or items recognised in other comprehensive income.

Current income tax for current period is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.

Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred tax assets and liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date.

A deferred tax asset is recognized to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences and tax losses can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized. Deferred tax assets and deferred tax liabilities have been offset as they are governed by the same taxation laws.

The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

l) Earnings per share

Basic earnings per share is computed by dividing the profit for the period attributable to equity shareholders of the company by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the profit for the period attributable to equity shareholder is divided by the weighted average number of shares outstanding during the period after adjusting for the effects of all dilutive potential equity shares, if any.

m) Dividend

Final dividends on shares are 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.

n) Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

Financial assets and financial liability are recognised when the company entity becomes a party to the contractual provisions of its instruments.

i) Initial Recognition and measurement

All financial assets and liabilities are recognized at fair value on initial recognition. Transaction cost in relation to financial assets and financial liabilities other than those carried at fair value through profit or loss are added to the fair value on initial recognition. Transaction cost that are directly attributable to the acquisition or issue of financial assets and financial liabilities, that are carried at fair value through profit or loss are immediately recognized in the statement of profit or loss.

ii) Subsequent measurement

> Non-derivative financial instruments

1. Financial assets carried at amortised cost

A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

2. Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Investment in Equity Instruments measured at fair value through OCI

The company can make an irrevocable election for its investment which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model.

These elected investments are initially measured at fair value plus transaction cost, subsequently these are measured at fair value with gains and losses arising from changes in fair value recognized in Other Comprehensive Income and accumulated in the Reserve for equity instruments through Other Comprehensive Income. The cumulative gain or loss is not reclassified to the Statement of Profit or loss on disposal of the investments.

- The above election is not permitted if the equity investment is held for trading.

Dividend on these investments in equity instruments are recognised in profit or loss when the Company’s right to receive the dividends is established, it is probable that the economic benefits associated with the dividend will flow to the entity, the dividend does not represent a recovery of part of cost of the investment and the amount of dividend can be measured reliably. Dividends recognised in profit or loss are included in the ’Other income’ line item.

3. Financial assets at fair value through profit or loss

A financial asset which is not classified in any of the above categories is subsequently measured at fair value through profit or loss.

4. Financial liabilities

The financial liabilities are subsequently carried at amortized cost using the effective interest method. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

> Derivative financial instruments

The Company holds derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counter party for these contracts is generally a bank.

Financial Asset or Financial Liability at fair value through Profit or Loss

Although the company believes that these derivatives constitute hedges from an economic perspective, they may not qualify for hedge accounting under Ind AS 109, Financial Instruments. Any derivative that is either not designated a hedge, or is so designated but is ineffective as per Ind AS 109, is categorized as a financial asset or financial liability, at fair value through profit or loss. Derivatives not designated as hedges are recognized initially at fair value and attributable transaction costs are recognized in the statement of profit and loss when incurred. Subsequent to initial recognition, these derivatives are measured at fair value through profit or loss and the resulting exchange gains or losses are charged to statement of profit and loss.

> Cash Flow Hedge

The Company has not designated derivative financial instruments as cash flow hedges.

> Equity Instruments:

Equity instruments are any contract that evidences a residual interest in the assets of an equity after deducting all of its liabilities.

> Equity Share capital Ordinary Shares

Equity shares issued by the company are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares and share options are recognized as a deduction from equity, net of any tax effects.

iii) Derecognition of financial instruments

A financial asset is derecognized when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109.

A financial liability is derecognized when the obligation specified in the contract is discharged or cancelled or expires.

iv) Offsetting

Financial assets and financial liabilities are offset and the net amount is presented in the balance sheet when, and only when, the company has a legally enforceable right to set off the amount and it intends, either to settle them on a net basis or to realize the asset and settle the liability simultaneously.

v) Fair value Measurement

The fair value of financial instruments is determined using the valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

Based on the three level fair value hierarchy, the methods used to determine the fair value of financial assets and liabilities include quoted market price, discounted cash flow analysis and valuation certified by the external valuer.

In case of financial instruments where the carrying amount approximates fair value due to the short maturity of those instruments, carrying amount is considered as fair value.

o) Impairment of financial assets

The company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss.

Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL.

p) Segment reporting

An operating segment is a component of the company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the company’s other components, and for which discrete financial information is available.

q) Cash flow statement

The cash flow statement is prepared in accordance with the Indian Accounting Standard (Ind AS) - 7 “Statement of Cash flows” using the indirect method for operating activities.

r) Cash and cash equivalent

Cash and cash equivalent include cash in hand, balances with banks and short term deposits where the original maturity is three months or less and which are subject to an insignificant risk of changes in value. Bank overdraft are included as a component of cash and cash equivalent for the purpose of statement of cash flow.

s) Provisions and Contingent Liabilities Provisions

A provision is recognized if, as a result of past event, the company has a present obligation (legal or constructive) and reliable estimate can be made of the amount of the obligation and it is probable that an outflow of economic benefits will be required to settle the obligation.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as finance cost.

Contingent liability

Contingent liability is disclosed in the case of:

> A present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation;

> A present obligation arising from past events, when no reliable estimate is possible;

> Apossible obligation arising from past events, unless the probability of outflow of resources is remote.

Commitments include the amount of purchase order (net of advances) issued to parties for completion of assets.

Provisions, contingent liabilities, contingent assets and commitments are reviewed at each balance sheet date.

2.4 Significant accounting judgements, estimates and assumptions

The preparation of the financial statements in conformity with Indian Accounting Standards (Ind AS) require management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amount of revenues, expenses, assets and liabilities and disclosure of contingent liabilities at the date of the financial statement and reported amount of revenue and expense during the period.

Although these estimates are based upon management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcome requiring a material adjustment to the carrying amount of assets or liabilities in future period.

The following are the areas of estimation uncertainty and critical judgements that the management has made in the process of applying the Company''s accounting policies and that have the most significant effect on the amounts recognised in the financial statements:

i) Useful lives of property, plant and equipment

The estimated useful lives of property, plant and equipment are based on a number of factors including the effects of obsolescence, internal assessment of user experience and other economic factors (such as the stability of the industry, and known technological advances) and the level of maintenance expenditure required to obtain the expected future cash flows from the asset.

The Company reviews the useful life of property, plant and equipment at the end of each reporting date.

ii) Recoverable amount of property, plant and equipment

The recoverable amount of property plant and equipment is based on estimates and assumptions regarding the expected market outlook and expected future cash flows. Any changes in these assumptions may have a material impact on the measurement of the recoverable amount and could result in impairment.

iii) Defined benefit plans

Employee benefit obligations are measured on the basis of actuarial assumptions including any changes in these assumptions that may have a material impact on the resulting calculations.

iv) Recognition of deferred tax assets

Management judgement is required for the calculation of provision for income taxes and deferred tax assets and liabilities. The company reviews at each balance sheet date the carrying amount of deferred tax assets. The factors used in estimates may differ from actual outcome which could lead to signification adjustment to the amounts reported in financial statement.

v) Contingencies

Management judgement is required for estimating the possible outflow of resources, if any, in respect of contingencies/claims/litigations against the Company as it is not possible to predict the outcome of pending matters with accuracy. The Company annually assesses such claims and monitors the legal environment on an ongoing basis, with the assistance of external legal counsel, wherever necessary.

vi) Fair value measurement

Some of the company''s assets and liabilities are measured at fair value for financial reporting process. In estimating the fair value of an asset or liability, the company uses market-observable data to the extent is available.

vii) Estimate of uncertainty relating to global health pandemic (COVID-19)

On account of COVID-19 pandemic the Company has made assessment of its liquidity position for the next year and the recoverability and carrying value of its assets comprising property, plant and equipment, intangible assets, right of use assets, investments, inventories and trade receivables as at the date of the balance sheet. The Company has considered internal and external sources of information for making said assessment. Basis the evaluation of the current estimates, the Company expects to recover the carrying amount of these assets and no material adjustments is required in the financial statements. Given the uncertainties associated with nature, condition and duration of COVID-19, the Company will closely monitor any material changes arising of the future economic conditions and any significant impact of these changes would be recognized in the financial statements as and when these material changes to economic condition arise.

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Mar 31, 2019

1 (i) Significant accounting Policies

(a) Basis of preparation of financial statements

The financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) under the historical cost convention on accrual basis except for certain financial assets and liabilities (including derivative instruments) which are measured at fair value, the provisions of the Companies Act, 2013( ‘the Act’) (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules issued thereafter.

Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

(b) Statement of Compliance

The financial statements comply in all material aspects with Indian Accounting Standards

(c) Functional and Presentation currency

The functional currency of the Company is the Indian rupee. These financial statements are presented in Indian rupees. All amounts have been rounded-off to the nearest lakhs, up to two places of decimal, unless otherwise indicated.

(d) Use of Estimates and Judgements

The preparation of financial statements, in conformity with Ind AS requires management to exercise judgments, make estimates and assumptions. These judgements, estimates and assumptions effect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. The application of accounting policies that require critical accounting estimates involving complex and subjective judgement and use of assumption in these financial statements have been disclosed in notes. Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made, and if material their effects are disclosed in the notes to the financial statements.

The areas involving significant estimates and judgement include determination of useful life of property, plant and equipment (Refer note 3), measurement of defined benefit obligations (Refer note 39),recognition and measurement of provisions and contingencies (Refer note 37) and recognition of deferred tax assets/liabilities (Refer note 52).

(e) Revenue recognition

The Company derives revenue primarily from sale of Writing and Printing Paper and Soda Ash (from chemical recovery). Effective April 1, 2018, the Company adopted Ind AS 115 “Revenue from Contracts with Customers” using the cumulative catch up transition method, applied to contracts that were not completed as of April 1, 2018. In accordance with the cumulative catch-up transition method, the comparatives have not been retrospectively adjusted. The following is a summary of new and/or revised significant accounting policies related to revenue recognition:

Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for returns, discounts, value added taxes and amounts collected on behalf of third parties.

The effect on adoption of Ind AS 115 was insignificant as the revenue is of short term nature and performance obligations are satisfied upon delivery of goods.

i) Sale of Writing and Printing Paper and Soda Ash

Revenue is recognized as and when Writing and Printing Paper and Soda Ash is sold. Revenue from the sale of Writing and Printing Paper , Soda Ash and Traded Goods is recognised when control of the goods is passed to the buyer i.e. at the point of sale / delivery to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. Sale is net of sales returns, discounts and goods and services tax.

ii) Export Incentives

The revenue in respect of export benefits is recognised on post export basis at the rate at which the entitlements accrue.

iii) Dividend

Dividend Income from investments is recognized when shareholder’s right to receive payment is established.

iv) Interest

Interest from customer

Interest income is recognised on a time proportion basis taking into account the amount outstanding and the applicable interest rate.

Other Interest

Interest income is recognised using effective interest rate (EIR).

v) Rental Income

The company policy for recognizing of revenue from operating lease is described below in part no 2 (i) m.

vi) Insurance and other claims

Insurance and other claims are recognized when there exist no significant uncertainty with regard to the amount to be realized and the ultimate collection thereof.

(f) Employee Benefits

i) Short Term Employee benefit:

The short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised on an undiscounted accrual basis during the year when the employees render the services. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related services.

ii) Defined Contribution plan Provident Fund:

Employees receive benefit in the form of Provident fund which is a defined contribution plan. The company has no obligation, other than the contribution payable to the provident fund. The company recognises contribution payable to the provident fund scheme as an expense, when an employee renders the related service.

iii) Defined Benefit Plan Gratuity:

The Company provides for gratuity a defined benefit retirement plan “The gratuity plan” covering eligible employees. The gratuity plan provides for lump sum payment to vested employee at retirement, death, incapacitation or termination of employee of an amount based on the respective employees’ salary and the tenure of employment with the company.

Liability with regard to Gratuity Plan is determined by actuarial valuation, performed by an independent actuary at each Balance sheet date using the project unit credit method.

The company fully contributes all ascertained liabilities to the SIL-Group Gratuity Trust. Trustees administer contributions made to the trust and Contributions are invested in a scheme with Life Insurance Corporation of India as permitted by Indian Law.

The Company recognises the net obligation of a defined plan in its Balance sheet as an asset or liability. Gains and losses through re-measurements of the net defined benefit liability/(asset) are recognized in other comprehensive income and are not reclassified to profit or loss in subsequent periods. The actual return of the portfolio of plan assets, in excess of the yields computed by applying the discount rate used to measure the defined benefit obligations is recognized in Other Comprehensive Income.

iv) Other long term employee benefit Compensated absences:

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as a liability at the present value of the defined benefit obligation at the Balance Sheet date. The cost of providing benefits is determined using projected unit credit method, with actuarial valuations being carried out at each Balance sheet date. Actuarial gain /loss are recognised in the statement of profit or loss in the period in which they occur.

(g) Property, Plant and Equipment

Freehold land is stated at cost and not depreciated. All other items of Property, plant and equipment are stated at cost less accumulated depreciation and impairment if any. The Cost of an item of Property, Plant and Equipment comprises:

a) its purchase price net of recoverable taxes where applicable and any attributable expenditure (directly or indirectly) for bringing the asset to its working condition for its intended use.

b) Subsequent expenditures relating to property, plant and equipment is capitalized only when it is probable that future economic benefits associated with these will flow to the Company and the cost of the item can be measured reliably.

c) Initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, if any, the obligation for which an entity incurs either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period.

Depreciation on property plant and equipment is provided on Straight Line Method on the basis of useful lives of such assets specified in Part C of Schedule II to the Companies Act, 2013, The useful life of Property, plant and equipment is as under:

Building - 30-60 years.

Plant and Machinery - 15-25 years.

Office Equipment - 5 Years

Computer Equipment - 3 years.

Furniture and fittings - 10 years

Vehicles excluding Motor cycles - 08 years.

Motor cycles - 10 years.

On transition to Ind-As, the company has elected to continue with the carrying value of all the property, plant and equipment recognised as at 01 April, 2017, measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment.

Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as capital advances under other non-current assets and the cost of assets not put to use before such date are disclosed under ‘Capital work-in-progress’. The depreciation method, useful lives and residual value are reviewed periodically and at the end of each reporting period.

The cost and related accumulated depreciation are eliminated from the financial statements upon sale or retirement of the asset and the resultant gains or losses are recognized in the statement of profit and loss. Assets to be disposed off are reported at the lower of the carrying value or the fair value less cost to sell.

(h) Intangible assets

Intangible assets are stated at cost less accumulated amount of amortisation and impairment if any. Cost includes purchase price and all other direct expenses incurred to make the intangible asset ready for its intended use.Intangible assets are amortised over their respective individual estimated useful lives on a straight line basis, from the date that they are available for use. The estimated useful life of an identifiable intangible asset is based on a number of factors including the effects of obsolescence etc. The amortization method, estimated useful lives are reviewed periodically and at end of each reporting period.

Intangible assets (Softwares) have been amortised on estimated useful life of six years.

(i) Impairment of property, plant and equipment

Property, plant and equipment and intangible assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the CGU (Cash Generating unit) to which the asset belongs.

If such assets are considered to be impaired, the impairment to be recognized in the statement of profit and loss is measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount of the asset. An impairment loss is reversed in the statement of profit and loss if there has been a change in the estimates used to determine the recoverable amount. The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated depreciation) had no impairment loss been recognized for the asset in prior years.

(j) Inventories

Inventories are valued at cost or net realisable value whichever is lower. The cost in respect of various items of inventories is computed as under:

a) Raw Material and Components First in First out method plus direct expenses

b) Stores and Spares Weighted Average method plus direct expenses

c) Work-in-progress Cost of material plus Conversion cost depending upon the stage of completion.

d) Finished Goods Cost of material plus conversion cost, packing cost, and other overheads incurred to bring the goods to their present conditions and location.

e) Material in Transit Actual cost plus direct expenses to the extent incurred.

(k) Government Grants

The government grants are recognised only when there is a reasonable assurance of compliance that conditions attached to such grants shall be complied with and it is reasonably certain that the ultimate collection will be made.

Government grants related to revenue are recognised on a systematic basis in the statement of profit and loss over the periods necessary to match them with the related costs which they are intended to compensate.

Consequent to the amendment in Ind-AS 20 "Government Grants" w.e.f April 1, 2018, the Company has opted to continue and treat ‘Government grant in relation to Property, plant and equipment’ as deferred income and the same is recognised in the statement of profit and loss on a systematic basis over the useful life of the asset.

(l) Borrowing costs

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are capitalised as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expenditure in the period in which these are incurred. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange difference to the extent regarded as an adjustment to the borrowing cost.

(m) Leasing

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as opearting leases.

The Company as lessor

Rental income from operating leases is generally recognised on a straight-line basis over the term of the relevant lease. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the Company’s expected inflationary cost increases, such increases are recognised in the year in which such benefits accrue.

The Company as lessee

Rental expense from operating leases is generally recognised on a straight-line basis over the term of the relevant lease. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases, such increases are recognised in the year in which such benefits accrue.

(n) Foreign currency transactions

i) Functional and Presentation currency

The functional currency of the company is Indian rupee. These financial statements are presented in Indian rupees.

ii) Transaction and balances

Transactions in foreign currency are initially recorded, on initial recognition in the functional currency, by applying to the foreign currency amount the exchange rate between the functional currency at the date of the transaction.

Effective 01 April 2018, the company has adopted Appendix-B to Ind-AS 21’Foreign currency transaction and advance consideration’, which clarifies the date of transaction for the purpose of determining the exchange rate to be used on initial recognition of the related asset, expense or income where an entity has paid or received advance consideration in a foreign currency. The effect on account of adoption of this amendment is insignificant.

Monetary items denominated in foreign currency are recognised using the closing exchange rate as on balance sheet date. Non-monetary items are measured in terms of historical cost in a foreign currency is translated using the exchange rate at the date of the transaction.

Exchange differences arising on the settlement of monetary items or on reporting of monetary items at rates different from rates at which these were recognised on initial recognition during the period or reported in previous financial statements as recognised in the statement of profit or loss in the period in which they arise.

Foreign exchange differences regarded as an adjustment to borrowing costs are presented in the statements of profit and loss, within finance cost. All other foreign exchange gains and losses are presented in the statement of profit and loss on net basis.

(o) Accounting for taxes on income

Income tax expense comprises of current and deferred income tax. Income tax expense is recognized in net profit in the statement of profit and loss except to the extent that it relates to items recognised directly in equity, in which case it is recognized in other comprehensive income.

Current income tax for current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. Deferred income tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.

Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect of changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date.

A deferred income tax asset is recognized only to the extent that it is probable that future taxable profit will be available against which the deductible temporary difference and tax losses can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

MAT credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period for which the MAT credit can be carried forward for set off against the normal tax liability. The said asset is created by way of a credit to the Statement of Profit and Loss and shown as MAT credit entitlement grouped with deferred tax assets (net) in the financial statement.

(p) Earnings Per Share

Basic Earning per share is computed by dividing the net profit or loss for the period attributable to equity shareholders of the company by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholder is divided by the weighted average number of shares outstanding during the period after adjusting for the effects of all dilutive potential equity shares, if any.

(q) Dividend

Final dividends on shares are 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.

(r) Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

i. Initial Recognition and measurement

All financial assets and liabilities are recognized at fair value on initial recognition. T ransaction cost in relation to financial assets and financial liabilities other than those carried at fair value through profit or loss are added to the fair value on initial recognition. Transaction cost that are directly attributable to the acquisition or issue of financial assets and financial liabilities, that are carried at fair value through profit or loss are immediately recognized in the statement of profit or loss.

ii. Subsequent measurement

- Non-derivative financial instruments

1. Financial assets carried at amortised cost

A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

2. Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

The company can make an irrevocable election for its investment which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the company has made an irrevocable election based on its business model, for its investment which are classified as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.

3. Financial assets at fair value through profit or loss

A financial asset which is not classified in any of the above categories is subsequently measured at fair value through profit or loss.

4. Financial liabilities

The financial liabilities are subsequently carried at amortized cost using the effective interest method. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

- Derivative financial instruments

The Company holds derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counter party for these contracts is generally a bank.

This category has financial assets or liabilities which are not designated as hedges.

Although the Company believes that these derivatives constitute hedges from an economic perspective, they may not qualify for hedge accounting under Ind AS 109, Financial Instruments. Any derivative that is either not designated a hedge, or is so designated but is ineffective as per Ind AS 109, is categorized as a financial asset or financial liability, at fair value through profit or loss. Derivatives not designated as hedges are recognized initially at fair value and attributable transaction costs are recognized in the statement of profit and loss when incurred. Subsequent to initial recognition, these derivatives are measured at fair value through profit or loss and the resulting exchange gains or losses are included in other income/other expenses. Assets/ liabilities in this category are presented as current assets/current liabilities if they are either held for trading or are expected to be realized within 12 months after the balance sheet date.

- Cash Flow Hedge

The Company has not designated derivative financial instruments as cash flow hedges.

- Equity Share capital Equity Shares

Equity shares issued by the company are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares and share options are recognized as a deduction from equity, net of any tax effects.

Derecognition of financial instruments

A financial asset is derecognized when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109.

A financial liability is derecognized when the obligation specified in the contract is discharged or cancelled or expires.

Measurement of Fair value of financial instruments

The fair value of financial instruments is determined using the valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

Based on the three level fair value hierarchy, the methods used to determine the fair value of financial assets and liabilities include quoted market price, discounted cash flow analysis and valuation certified by the external valuer.

In case of financial instruments where the carrying amount approximates fair value due to the short maturity of those instruments, carrying amount is considered as fair value.

(s) Impairment of financial assets

The company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss.

Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognised is recognized as an impairment gain or loss in statement of profit or loss.

(t) Cash flow statement

The cash flow statement is prepared in accordance with the Indian Accounting Standard (Ind AS) - 7 “Statement of Cash flows” using the indirect method for operating activities.

(u) Cash and cash equivalent

Cash and cash equivalent for the purpose of statement of cash flows include bank balances, where the original maturity is three months or less. Other short term highly liquid investments that are readily convertible into cash and which are subject to an insignificant risk of changes in value. Bank overdraft are included as a component of cash and cash equivalent for the purpose of statement of cash flow.

(v) Provisions and Contingent Liabilities

A provision is recognized if, as a result of past event, the company has a present obligation (legal or constructive) and on management judgement that is reasonably estimable and it is probable that an outflow of economic benefits will be required to settle the obligation.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as finance cost.

Contingent liability is disclosed in the case of:

- A present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation;

- Apresent obligation arising from past events, when no reliable estimate is possible;

- Apossible obligation arising from past events, unless the probability of outflow of resources is remote.

Commitments include the amount of purchase order (net of advances) issued to parties for completion of assets.

Provisions, contingent liabilities, contingent assets and commitments are reviewed at each balance sheet date.

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Mar 31, 2018

1 (i) Significant Accounting Policies

(a) Statement of Compliance

The financial statements of the company have been prepared in accordance with and to comply in all material aspects to the Indian Accounting Standards (IndAS) specified under section 133 of the Companies Act, 2013 read with the Companies (Indian Accounting Standards) Rules, 2015. and the relevant provisions of the Act, as applicable.

The company has adopted all the IndAS standards and the adoption was carried out in accordance with IndAS 101 First time adoption of Indian Accounting Standards. Up to the year ended 31st March, 2017, the company prepared its financial statements in accordance with the requirements of Previous GAAP which includes accounting standards notified under the Companies (Accounting Standard) Rules, 2006. These are company''s first Ind AS financial statement. The date of transition to Ind AS is April 1, 2016. The detail of optional exemption and certain exemption availed on first time adoption are mentioned in “Note no. 53 on First time Adoption” forming part of financial statements. Further, the effect of transition from previous GAAP to Ind AS on the financial position, financial performance and cash flow has also been explained in the note.

Amounts for the year ended and as at March 31, 2017 were audited by previous auditors, S.C. Vasudeva & Co.

(b) Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention on accrual basis except for certain financial instruments which are measured at fair value, the provisions of the Companies Act, 2013( ''the Act'') (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules issued thereafter.

Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

(c) Functional and Presentation currency

The functional currency of the company is Indian rupee (INR). These financial statements are presented in Indian rupees. All amounts have been rounded off to the nearest rupee (INR) unless otherwise indicated.

(d) Use of estimates and judgements

The preparation of financial statements, in conformity with Ind AS requires management to make estimates, judgements and assumptions. These estimates, judgements and assumptions effect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. The application of accounting policies that require critical accounting estimates involving complex and subjective judgement and use of assumption in these financial statements have been disclosed in notes. Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as management become aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made, and if material their effects are disclosed in the notes to the financial statements.

^(e) Revenue Recognition

i) Sale of goods:

Revenue from sale of goods is recognised at the time of transfer of all significant risks and rewards of ownership to the buyer and when the company does not retain effective control on the goods transferred to a degree usually associated with ownership; and cost has been incurred and it is probable that the economic benefit will flow to the company and the amount of revenue can be measured reliably.

In accordance with Ind AS 18 on “Revenue” and Schedule III of the Companies Act, 2013, Sales for the previous year ended 31 March 2017 and for the period 1 April to 30 June 2017 were reported gross of Excise Duty and net of VAT/ CST. Excise Duty was reported as a separate expense line item. Consequent to the introduction of Goods and Services Tax (GST) with effect from 1 July 2017, VAT/CST, Excise Duty etc. have been subsumed into GST and accordingly the same is not recognised as part of sale.

ii) Export Incentives

The revenue in respect of export benefits is recognised on post export basis at the rate at which the entitlements accrue.

iii) Dividend

Dividend income from investment is recognised when the right to receive the payment is established.

iv) Interest

Interest from customer

Revenue from interest is recognised on a time proportion basis taking into account the amount outstanding and rate applicable. Other Interest

Interest income is recognised using effective interest rate (EIR).

v) Insurance and other claims

Insurance and other claims are recognized when there exist no significant uncertainty with regard to the amount to be realized and the ultimate collection thereof.

(f) Employee Benefits

i) Short Term Employee benefit:

The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised on an undiscounted accrual basis during the year when the employees render the services. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related services.

ii) Defined Contribution plan Provident Fund:

Employees receive benefit in the form of Provident fund which is a defined contribution plan. The company has no obligation, other than the contribution payable to the provident fund. The company recognises contribution payable to the provident fund scheme as an expense, when an employee renders the related service.

iii) Defined Benefit plan Gratuity:

The Company provides for gratuity a defined benefit retirement plan “The gratuity plan” covering eligible employees. The Gratuity Plan provides for lump sum payment to vested employee at retirement, death, incapacitation or termination of employee of an amount based on the respective employees'' salary and the tenure of employment with the company.

Liability with regard to Gratuity Plan is determined by actuarial valuation, performed by an independent actuary at each Balance sheet date using the project unit credit method.

The company fully contributes all ascertained liabilities to the SIL-Group Gratuity Trust. Trustees administer contributions made to the trust and Contributions are invested in a scheme with Life Corporation of India as permitted by Indian Law.

The Company recognises the net obligation of a defined plan in its Balance sheet as an asset or liability. Gains and losses through re-measurements of the net defined benefit liability/(asset) are recognized in other comprehensive income and are not reclassified to profit or loss in subsequent periods. The actual return of the portfolio of plan assets, in excess of the yields computed by applying the discount rate used to measure the defined benefit obligations is recognized in Other Comprehensive Income.

iv) Compensated absences

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as a liability at the present value of the defined benefit obligation at the Balance Sheet date. The cost of providing benefits is determined using projected unit credit method, with actuarial valuations being carried out at each Balance sheet date Actuarial gain /loss are recognised in the statement of profit or loss in the period in which they occur.

(g) Property, Plant and Equipment

As transition to Ind As, the company has elected to continue with the carrying value of all items of its property, plant and equipment measured as per previous GAAP as at 1st April, 2016 as the deemed cost on the date of transition.

Freehold land is stated at cost and not depreciated. All other items of Property, plant and equipment are stated at cost less accumulated depreciation and impairment if any. The Cost of an item of Property, Plant and Equipment comprises:

(a) its purchase price net of recoverable taxes where applicable and any attributable expenditure (directly or indirectly) for bringing the asset to its working condition for its intended use.

(b) Subsequent expenditures relating to property, plant and equipment is capitalized only when it is probable that future economic benefits associated with these will flow to the Company and the cost of the item can be measured reliably.

(c) Initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, if any, the obligation for which an entity incurs either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period.

Depreciation on property plant and equipment is provided on Straight Line Method on the basis of useful lives of such assets specified in Part C of Schedule II to the Companies Act, 2013.

Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as capital advances under other non-current assets and the cost of assets not put to use before such date are disclosed under ''Capital work-in-progress''. The depreciation method, useful lives and residual value are reviewed periodically and at the end of each reporting period.

The cost and related accumulated depreciation are eliminated from the financial statements upon sale or retirement of the asset and the resultant gains or losses are recognized in the statement of profit and loss. Assets to be disposed off are reported at the lower of the carrying value or the fair value less cost to sell.

(h) Intangible assets

Intangible assets are stated at cost less accumulated amount of amortisation and impairment if any. Intangible assets are amortised over their respective individual estimated useful lives on a straight line basis, from the date that they are available for use. The estimated useful life of an identifiable intangible asset is based on a number of factors including the effects of obsolescence etc. The amortization method, estimated useful lives are reviewed periodically and at end of each reporting period.

(i) Inventories

Inventories are valued at cost or net realisable value whichever is lower. The cost in respect of various items of inventories is computed as under:

a) Raw Material and Components First in First out method plus direct expenses

b) Stores and Spares Weighted Average method plus direct expenses

c) Work-in-progress Cost of material plus Conversion cost depending upon the

stage of completion.

d) Finished Goods Cost of material plus conversion cost, packing

cost, and other overheads incurred to bring the

goods to their present conditions and location.

e) Material in Transit Actual cost plus direct expenses to the extent incurred.

(j) Government Grants

The government grants are recognised only when there is a reasonable assurance of compliance that conditions attached to such grants shall be complied with and it is reasonably certain that the ultimate collection will be made.

Government grants related to revenue are recognised on a systematic basis in the statement of profit and loss over the periods necessary to match them with the related costs which they are intended to compensate.

Government grant in relation to fixed asset is treated as deferred income and is recognised in the statement of profit and loss on a systematic basis over the useful life of the asset.

(k) Borrowing costs

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are capitalised as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expenditure in the period in which these are incurred. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange difference to the extent regarded as an adjustment to the borrowing cost.

(l) Leases

Leases under which the company assumes substantially all the risks and rewards of ownership are classified as finance leases. All other leases are classified as operating lease.

Lease payments under operating leases are recognized as an expense on a straight line basis in the statement of profit and loss over the term of lease.

(m) Foreign currency transactions

Transactions in foreign currency are recorded, on initial recognition in the functional currency, by applying to the foreign currency amount the SPOT exchange rate between the functional currency and the foreign currency at the date of the transaction.

Monetary items denominated in foreign currency are translated using the closing exchange rate as on balance sheet date. Non-monetary items are measured in terms of historical cost in a foreign currency is translated using the exchange rate at the date of the transaction.

Exchange differences arising on the settlement of monetary items or on reporting of monetary items at rates different from rates at which these were translated on initial recognition during the period or reported in previous financial statements as recognised in the statement of profit or loss in the period in which they arise.

Foreign exchange differences regarded as an adjustment to borrowing costs are presented in the statements of profit and loss, within finance cost. All other foreign exchange gains and losses are presented in the statement of profit and loss on net basis.

(n) Accounting for taxes on income

Income tax expense comprises of current and deferred income tax. Income tax expense is recognized in net profit in the statement of profit and loss except to the extent that it relates to items recognised directly in equity, in which case it is recognized in other comprehensive income.

Current income tax for current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

Deferred income tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.

Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect of changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date.

Adeferred income tax asset is recognized only to the extent that it is probable that future taxable profit will be available against which the deductible temporary difference and tax losses can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

MAT credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period for which the MAT credit can be carried forward for set off against the normal tax liability. The said asset is created by way of a credit to the Statement of Profit and Loss and shown as MAT credit entitlement grouped with deferred tax assets (net) in the financial statement.

(o) Earnings Per Share

Basic Earning per share is computed by dividing the net profit or loss for the period attributable to equity shareholders of the company by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholder is divided by the weighted average number of shares outstanding during the period after adjusting for the effects of all dilutive potential equity shares, if any.

(p) Dividend

Final dividends on shares are 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.

^(q) Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

i. Initial Recognition and measurement

All financial assets and liabilities are recognized at fair value on initial recognition.

Transaction cost in relation to financial assets and financial liabilities other than those carried at fair value through profit or loss (FVTPL) are added to the fair value on initial recognition.

Transaction cost that are directly attributable to the acquisition or issue of financial assets and financial liabilities, that are carried at fair value through profit or loss are immediately recognized in the statement of profit or loss.

ii. Subsequent measurement

- Non-derivative financial instruments

1. Financial assets carried at amortised cost

A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

2. Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

The company has made an irrevocable election for its investment which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the company has made an irrevocable election based on its business model, for its investment which are classified as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.

3. Financial assets at fair value through profit or loss

A financial asset which is not classified in any of the above categories is subsequently measured at fair value through profit or loss.

4. Financial liabilities

The financial liabilities are subsequently carried at amortized cost using the effective interest method. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

- Derivative financial instruments

The Company holds derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counter-party for these contracts is generally a bank.

This category has financial assets or liabilities which are not designated as hedges.

Although the Company believes that these derivatives constitute hedges from an economic perspective, they may not qualify for hedge accounting under Ind AS 109, Financial Instruments. Any derivative that is either not designated a hedge, or is so designated but is ineffective as per Ind AS 109, is categorized as a financial asset or financial liability, at fair value through profit or loss. Derivatives not designated as hedges are recognized initially at fair value and attributable transaction costs are recognized in net profit in the statement of profit and loss when incurred. Subsequent to initial recognition, these derivatives are measured at fair value through profit or loss and the resulting exchange gains or losses are included in other income/other expenses. Assets/ liabilities in this category are presented as current assets/current liabilities if they are either held for trading or are expected to be realized within 12 months after the balance sheet date.

- Cash Flow Hedge

The Company has not designated derivative financial instruments as cash flow hedges.

- Equity Share capital Equity Shares

Equity shares issued by the company are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares and share options are recognized as a deduction from equity, net of any tax effects.

Derecognition of financial instruments

A financial asset is derecognized when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109.

A financial liability is derecognized when the obligation specified in the contract is discharged or cancelled or expires.

Fair value of financial instruments

The fair value of financial instruments is determined using the valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

Based on the three level fair value hierarchy, the methods used to determine the fair value of financial assets and liabilities include quoted market price, discounted cash flow analysis and valuation certified by the external valuer.

In case of financial instruments where the carrying amount approximates fair value due to the short maturity of those instruments, carrying amount is considered as fair value.

(r) Impairment of fixed assets

i) Financial assets

The company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognised is recognized as an impairment gain or loss in statement of profit or loss.

ii) Impairment of property, plant and equipment and intangible assets

Property, plant and equipment and intangible assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the CGU (Cash Generating Unit) to which the asset belongs.

If such assets are considered to be impaired, the impairment to be recognized in the statement of profit and loss is measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount of the asset. An impairment loss is reversed in the statement of profit and loss if there has been a change in the estimates used to determine the recoverable amount. The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated depreciation) had no impairment loss been recognized for the asset in prior years.

(s) Cash flow statement

The cash flow statement is prepared in accordance with the Indian Accounting Standard (Ind AS) - 7 “Statement of Cash flows” using the indirect method for operating activities.

(t) Cash and cash equivalent

Cash and cash equivalent for the purpose of statement of cash flows include bank balances, where the original maturity is three months or less. Other short term highly liquid investments that are readily convertible into cash and which are subject to an insignificant risk of changes in value. Bank overdraft are included as a component of cash and cash equivalent for the purpose of statement of cash flow.

(u) Provisions and Contingent Liabilities

A provision is recognized if, as a result of past event, the company has a present obligation (legal or constructive) and on management judgement that is reasonably estimable and it is probable that an outflow of economic benefits will be required to settle the obligation.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as finance cost.

Contingent liability is disclosed in the case of:

- A present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation;

- A present obligation arising from past events, when no reliable estimate is possible;

- A possible obligation arising from past events, unless the probability of outflow of resources is remote.

Commitments include the amount of purchase order (net of advances) issued to parties for completion of assets.

Provisions, contingent liabilities, contingent assets and commitments are reviewed at each balance sheet date.

(v) Current and Non -current classification

All the assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle.

Assets

An asset is classified as current when it satisfies any of the following criteria:

i) It is expected to be realised in, or is intended for sale or consumption in, the Company''s normal operating cycle

ii) It is held primarily for the purpose of being traded

iii) It is expected to be realised within 12 months after the reporting date or

iv) It is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

Current assets include the current portion of non-current financial assets. All other assets are classified as non-current. Liabilities

A liability is classified as current when it satisfies any of the following criteria

i) It is expected to be settled in the Company''s normal operating cycle

ii) It is held primarily for the purpose of being traded

iii) It is due to be settled within 12 months after the reporting date or

iv) The Company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

Current liabilities include current portion of non-current financial liabilities. All other liabilities are classified as non -current.

The Company has ascertained its operating cycle as 12 months for the purpose of current / non-current classification of assets and liabilities. This is based on the nature of products and the time between acquisition of assets for processing and their realisation in cash and cash equivalents.

2 (ii) Critical accounting estimates

- Useful lives of property, plant and equipment

The estimated useful lives of property, plant and equipment are based on a number of factors including the effects of obsolescence, internal assessment of user experience and other economic factors (such as the stability of the industry, and known technological advances) and the level of maintenance expenditure required to obtain the expected future cash flows from the asset.

The Company reviews the useful life of property, plant and equipment at the end of each reporting date.

- Recoverable amount of property, plant and equipment

The recoverable amount of property plant and equipment is based on estimates and assumptions regarding the expected market outlook and expected future cash flows. Any changes in these assumptions may have a material impact on the measurement of the recoverable amount and could result in impairment.

- Post-retirement benefit plans

Employee benefit obligations are measured on the basis of actuarial assumptions including any changes in these assumptions that may have a material impact on the resulting calculations.

- Recognition of deferred tax assets

Recognition of deferred tax assets depends upon the availability of future profits against which tax losses carried forward can be used.

2 (iii) Recent Accounting pronouncements:

a) Appendix B to Ind AS 21, Foreign currency transactions and advance consideration:

On March 28, 2018, Ministry of Corporate Affairs ("MCA") has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 containing Appendix B to Ind AS 21, “Foreign Currency Transactions and Advance Consideration” which clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income is the date on which an entity initially recognises the non-monetary asset or non-monetary liability arising from the payment or receipt of advance consideration.

The amendment is applicable for annual reporting periods beginning on or after April 1, 2018. The Company is evaluating the impact of this amendment on its financial statements.

b) Ind AS 115- Revenue from Contract with Customers:

On March 28, 2018, Ministry of Corporate Affairs ("MCA") has notified the Ind AS 115, Revenue from Contract with Customers. The core principle of the new standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

Specifically, the standard introduces a 5-step approach to revenue recognition:

Step 1: Identify the contract(s) with a customer Step 2: Identify the performance obligation in contract Step 3: Determine the transaction price

Step 4: Allocate the transaction price to the performance obligations in the contract Step 5: Recognise revenue when (or as) the entity satisfies a performance obligation

Under Ind AS 115, an entity recognises revenue when (or as) a performance obligation is satisfied, i.e. when ''control'' of the goods or services underlying the particular performance obligation is transferred to the customer.

Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity''s contracts with customers.

The effective date for adoption of Ind AS 115 is financial periods beginning on or after April 1, 2018.

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Mar 31, 2016

1 Corporate Information

Shreyans Industries Limited (the Company) is a public company incorporated under the provisions of the Companies Act, 1956 on 11th June, 1979. The name of the company at its incorporation was Shreyans Paper Mills Ltd. and subsequently changed to Shreyans Industries Limited on 20^th October 1992. The company is engaged in manufacturing of Writing and Printing Paper.

Significant Accounting Policies and Notes on Accounts

2 Significant Accounting Policies

(a) Basis of Preparation of Financial Statements

The financial statements are prepared in accordance with generally accepted accounting principles under the historical cost convention on accrual basis in accordance with the applicable accounting standards prescribed under section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rule 2014.

(b) Use of Estimates

The preparation of financial statements, in conformity with the generally accepted accounting principles, require estimates and assumptions to be made that affect the reported amount of assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results materialize.

(c) Revenue Recognition

(i) Sales

Revenue from sale of goods is recognized;

(a) When all the significant risks and rewards of ownership transferred to the buyer and the company retains no effective control of the goods transferred to a degree usually associated with ownership; and

(b) No significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of goods.

(ii) Export Incentives:

Revenue in respect of export incentives is recognized on post export basis.

(iii) Interest :

Revenue from interest is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

(iv) Dividend

Dividend Income from investment is recognized when the right to receive payment is established.

(v) Insurance and Other Claims

Revenue in respect of claims is recognized when no significant uncertainty exists with regard to the amount to be realized and the ultimate collection thereof.

(d) Employees Benefits

(i) Short Term Employees Benefits

Short Term Employees Benefits are recognized as an expense on an undiscounted basis in the statement of profit and loss of the year in which the related service is rendered.

(ii) Post Employment Benefits

i) Defined Contribution Plans

a) Provident Fund:

The Employer''s Contribution to provident fund is made in accordance with the provisions of the Employee''s Provident Fund and Miscellaneous Provisions Act, 1952 and is recognized as an expense in the statement of profit and loss.

ii) Defined Benefit Plans

a) Gratuity:

The Group Gratuity Cash Accumulation Scheme , managed by Life Insurance Corporation of India is a defined benefit plan. The liability for gratuity is provided on the basis of actuarial valuation carried out by an independent actuary as at the Balance Sheet date. The present value of the company''s obligation is determined on the basis of actuarial valuation at the year end, using the projected unit credit method and the fair value of plan assets is reduced from the gross obligations under the gratuity scheme to recognize the obligation on a net basis.

b) Leave Encashment:

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognized as a liability at the present value of the defined benefit obligation at the Balance Sheet date, determined on actuarial valuation basis using Projected Unit Credit Method. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government Securities as at the Balance Sheet date.

iii) The actuarial gain/loss is recognized in the statement of profit and loss in the period in which they occur.

(e) Fixed Assets (Tangible Assets)

(i) Fixed assets are stated at historical cost less accumulated depreciation.

(ii) Cost of fixed assets comprises its purchase price and any attributable expenditure (direct and indirect) for bringing the assets to its working condition for its intended use.

(iii) Expenditure incurred on renovation/modernization of the existing fixed assets is added to the book value of these assets where such renovation/modernization increases the future benefit from them beyond their previously assessed standard of performance.

(f) Intangible Assets

Intangible assets are stated at cost less accumulated amount of amortization.

(g) Depreciation

i) Depreciation on tangible fixed assets is provided on Straight Line Method on the basis of useful lives of such assets specified in Schedule II to the Companies Act, 2013.

ii) Assets costing F 5,000/- or less acquired during the year are depreciated at 100%.

iii) The Intangible fixed assets acquired prior to 1^st April 2014 are amortized over the revised useful life of the assets based on the indicative useful life of the assets mandated by Schedule II to the Companies Act, 2013.

(h) Amortization

Intangible asset are amortized on straight line method. These assets are amortized over their estimated useful life.

(i) Investments

Long term Investments are carried at cost less provision, if any, for decline in the value of such investments, which is other than temporary. Current investments are carried at lower of cost and fair value.

(j) Inventories

Inventories are valued at cost or net realizable value, whichever is lower. The cost in respect of items of inventory is computed as under:

- In case of raw materials at FIFO basis plus direct expenses.

- In case of stores and spares at weighted average cost plus direct expenses.

- In case of work-in-progress at raw material cost plus conversion cost depending upon the stage of completion.

- In case of finished goods at raw material cost plus conversion cost, packing cost, excise duty and other overheads incurred to bring the goods to their present condition and location.

(k) CENVAT

Cenvat credit on excise duty/service tax paid on inputs, capital assets and input services is taken in accordance with the Cenvat Credit Rules, 2004.

(l) Government grants and subsidies

Government grants available to the company are recognized when there is a reasonable assurance of compliance with the conditions attached to such grants and where benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made.

Government subsidy in the nature of promoter''s contribution is credited to capital reserve.

Government subsidy related to specific fixed assets is deducted from the gross value of the assets concerned.

(m) Borrowing Costs

Borrowing costs that are directly attributable to acquisition or construction of a qualifying asset are capitalized as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expenditure in the period in which these are incurred.

(n) Lease

The assets acquired on lease wherein a significant portion of risks and rewards of ownership of an asset is retained by the lessor are classified as operating leases. Lease rentals paid for such leases are recognized as an expense on systematic basis over the terms of lease.

(o) Foreign Currency Transactions

(a) Transactions in foreign currency are recorded on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of transaction except in case of export invoices which are recorded at a rate notified by the Customs department for invoice purpose which approximates the actual rate as at the date of transaction. Exchange difference arising on realization of export sale is recognized as income or expense in the period in which they arise.

b) At each balance sheet date foreign currency monetary items are reported at closing rates. Exchange differences arising on settlement of monetary items or on reporting the same at closing rate as at balance sheet date are recognized as income or expense.

c) The premium or discount arising at the inception of a forward contract which is not intended for trading or speculation purpose is amortised as expense or income over the life of the contract. Exchange difference on such forward contracts is recognized in the statement of profit or loss in the reporting period in which the exchange rates change. Any profit or loss arising on cancellation or renewal of a forward contract is recognised as income or as expense for the period.

(p) Accounting for Taxes on Income

Provision for taxation for the year comprises of current tax and deferred tax. Current tax is amount of Income-tax determined to be payable in accordance with the provisions of Income tax Act 1961. Deferred tax is the tax effect of timing difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

(q) Impairment of Assets

At each balance sheet date an assessment is made whether any indication exists that an asset has been impaired. If any such indication exists, an impairment loss i.e. the amount by which the carrying amount of an asset exceeds its recoverable amount is provided in the books of account.

(r) Earnings per Share

Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

(s) Provision and Contingent Liabilities

(i) Provision is recognised (for liabilities that can be measured by using substantial degree of estimate) when:

(a) the company has a present obligation as a result of a past event;

(b) a probable outflow of resources embodying economic benefits is expected to settle the obligation ; and

(c) the amount of the obligation can be reliably estimated.

(ii) Contingent liability is disclosed in case there is:

(a) i. Possible obligation that arises from past events and existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the enterprise ; or

ii. A reliable estimate of the amount of the obligation cannot be made.

(b) A present obligation arising from past events but is not recognized :

i. When it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

ii. A reliable estimate of the amount of the obligation cannot be made.

(t) Cash flow statement

The cash flow statement has been made in accordance with the Accounting Standard (AS) - 3 on “Cash Flow Statements” prescribed in Companies (Accounts) Rules, 2014.

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Mar 31, 2014

(a) Basis of Preparation of Financial Statements

The financial statements are prepared on accrual basis under the historical cost convention in accordance with the accounting standards referred to in sub-section(3C) of section 211 and other relevant provisions of the Companies Act, 1956.

(b) Use of Estimates

The preparation of financial statements, in conformity with the generally accepted accounting principles, require estimates and assumptions to be made that affect the reported amount of assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

(c) Revenue Recognition

(i) Revenue from sale is recognised;

(a) When all the significant risks and rewards of ownership transferred to the buyer and the company retains no effective control of the goods transferred to a degree usually associated with ownership; and

(b) No significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of goods.

(ii) The revenue in respect of export incentives is recognised on post export basis.

(iii) Revenue from interest is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

(iv) Dividend from investment is recognized when the right to receive payment is established.

(v) Revenue in respect of claims is recognized when no significant uncertainty exists with regard to the amount to be realized and the ultimate collection thereof.

(d) Employees Benefits

(i) Short Term Employees Benefits

Short Term Employees Benefits are recognized as an expense on an undiscounted basis in the statement of profit and loss of the year in which the related service is rendered.

(ii) Post Employment Benefits

Defined Contribution Plan:

Contribution to provident fund is made in accordance with the provisions of the Employee''s Provident Fund and

Miscellaneous Provisions Act, 1952 and is recognized as an expense in the statement of profit and loss.

Defined Benefit Plans:

(a) Gratuity:

The Group Gratuity Cash Accumulation Scheme , managed by Life Insurance Corporation of India is a defined benefit plan. The liability for gratuity is provided on actuarial basis. The Present Value of the company''s obligation is determined on the basis of actuarial valuation at the year end using the projected unit credit method and the fair value of plan assets is reduced from the gross obligations under the gratuity scheme to recognize the obligation on a net basis.

(b) Leave Encashment

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as a liability at the present value of the defined benefit obligation at the Balance Sheet date, determined based on actuarial valuation using Projected Unit Credit Method. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government Securities as at the Balance Sheet date.

(iii) The actuarial gain/loss is recognized in the statement of profit and loss in the period in which they occur.

(e) Fixed Assets

(i) Fixed assets are stated at historical cost less accumulated depreciation.

(ii) Cost of fixed assets comprises its purchase price and any attributable expenditure (direct and indirect) for bringing an assets to its working condition for its intended use.

(iii) Expenditure incurred on renovation/modernisation on the existing fixed assets is added to the book value of these assets where such renovation/modernisation increases the future benefit from them beyond their previously assessed standard of performance.

(f) Intangible Assets

Intangible assets are stated at cost less accumulated amount of amortisation.

(g) Depreciation

i) Depreciation is provided on straight line method in accordance with and in the manner specified in Schedule XIV to the Companies Act, 1956.

ii) Assets costingt5000/- or less acquired during the year are depreciated at 100%.

(h) Amortisation

Intangible asset are amortised on straight line method. These assets are amortised over their estimated useful life.

(i) CENVAT

Cenvat credit on excise duty/service tax paid on inputs, capital assets and input services is taken in accordance with the Cenvat Credit Rules, 2004.

(j) Inventories

Inventories are valued at cost or net realisable value, whichever is lower. The cost in respect of items of inventory is computed as under:

- In case of raw materials at FIFO basis plus direct expenses.

- In case of stores and spares at weighted average cost plus direct expenses.

- In case of work-in-progress at raw material cost plus conversion cost depending upon the stage of completion.

- In case of finished goods at raw material cost plus conversion cost, packing cost, excise duty and other overheads incurred to bring the goods to their present condition and location.

(k) Investments

Long term Investments are stated at cost less provision, if any, for decline in the value of such investments, which is other than temporary. Current investments are stated at lower of cost and fair value.

(l) Foreign Currency Transactions

(a) Transactions in foreign currency are recorded on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of transaction except in case of export invoices which are recorded at a rate notified by the custom department for invoice purpose which approximates the actual rate as at the date of transaction. Exchange difference arising on realization of export sale is recognized as income or expense in the period in which they arise.

(b) At each balance sheet date foreign currency monetary items are reported at closing rates. Exchange differences arising on settlement of monetary items or on reporting the same at closing rate as at balance sheet date are recognized as income or expense.

(c) The premium or discount arising at the inception of a forward contract which is not intended for trading or speculation purpose is amortised as expense or income over the life of the contract. Exchange difference on such forward contracts is recognized in the statement of profit or loss in the reporting period in which the exchange rates change. Any profit or loss arising on cancellation or renewal of a forward contract is recognised as income or as expense for the period

(m) Borrowing Costs

Borrowing costs that are directly attributable to acquisition or construction of a qualifying asset are capitalised as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expenditure in the period in which these are incurred.

(n) Government grants and subsidies

Government grants available to the company are recognized when there is a reasonable assurance of compliance with the conditions attached to such grants and when benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made. Government subsidy in the nature of promoter''s contribution is credited to capital reserve. Government subsidy related to specific fixed assets is deducted from the gross value of the assets concerned.

(o) Impairment of Assets

At each balance sheet date an assessment is made whether any indication exists that an asset has been impaired. If any such indication exists, an impairment loss i.e. the amount by which the carrying amount of an asset exceeds its recoverable amount is provided in the books of account.

(p) Accounting for Taxes on Income

Provision for taxation for the year comprises of current tax and deferred tax. Current tax is amount of Income-tax determined to be payable in accordance with the provisions of Income tax Act 1961. Deferred tax is the tax effect of timing difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

(q) Provision and Contingent Liabilities

(i) Provision is recognised when:

(a) the company has a present obligation as a result of a past event;

(b) a probable outflow of resources embodying economic benefits is expected to settle the obligation ; and

(c) the amount of the obligation can be reliably estimated.

(ii) Contingent liability is disclosed in case there is:

(a) Possible obligation that arises from past events and existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the enterprise ; or

(b) a present obligation arising from past events but is not recognised :

i. when it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

ii. a reliable estimate of the amount of the obligation cannot be made.

(r) Earning per Share

Basic earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

(s) Lease

The assets acquired on lease wherein a significant portion of risks and rewards of ownership of an asset is retained by the lessor are classified as operating leases. Lease rentals paid for such leases are recognised as an expense on systematic basis over the terms of lease.

(t) Cash flow statement

The cash flow statement has been prepared in accordance with the Accounting Standard (AS) - 3 on "Cash flow statements” issued by the Companies (Accounting Standard) Rules, 2006.

b) Terms/ rights attached to equity shares

The company presently has one class of equity shares having par value of *10/- each. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and entitlement to dividend to an equity shareholder shall arise after such approval.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive any part of the 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 shareholder.

The rate of dividend on preference shares will be decided by the Board of directors as and when issued. Preferential shares as and when issued shall have the cumulative right to receive dividend as and when declared and shall have preferential right of repayment of amount of capital.

The company has declared dividend @ 12 % (previous year 10 %) during the year ended March 31, 2014.

c) Detail of Shares held by holding company/ ultimate holding company their subsidiaries and associates

There is no holding /ultimate holding company of the company and therefore no subsidiary/associate of holding / ultimate holding company.

a) Details of security for term loans

i) Term loans from banks (other than vehicles) are secured by a joint equitable mortgage created or to be created on immovable properties both present and future, situated at Ahmedgarh and Banah in the state of Punjab and hypothecation of whole of movable plant and machinery, machinery spares, tools and accessories and other movable, both present and future ( save and except book debts ) subject to the charge created or to be created by the company in favour of its bankers for its working capital loans. Term loans from banks are also personally guaranteed by promoter directors of the company.

ii) Term loans from banks for vehicles are secured by way of hypothecation of vehicles purchased out of such loans.

b) Terms of repayment of term loans from banks

i) Term loan from State Bank of Patiala amounting to Rs. 910.00 lacs (including current maturities of long term debt) carries interest @ 13.75% p.a. The loan is repayable in 13 quarterly instalments of Rs. 70.00 lacs each (Previous year Rs. 1190.00Lacs).

ii) Vehicle loan from ICICI Bank Limited amounting to Rs. 4.94 lacs (including current maturities of long term debt) carries interest @ 11.19% p.a. The loan is repayable in 35 monthly instalments (including interest) of Rs. 16725/- each (Previous yearRs. 6.31 Lacs).

iii) Vehicle loan from ICICI Bank Limited amounting to Rs. 5.34 lacs (including current maturities of long term debt) carries interest @ 10.57% p.a. The loan is repayable in 11 monthly instalments (including interest) of Rs. 51600/- each (Previous yearRs. 10.66 Lacs).

iv) Vehicle loan from ICICI Bank Limited amounting to Rs. 9.37 lacs (including current maturities of long term debt) carries interest @ 9.82% p.a. The loan is repayable in 12 monthly instalments (including interest) of Rs. 82992/- each (Previous year Rs. 17.94 lacs).

v) Vehicle loan from ICICI Bank Limited amounting to Rs. 4.71 lacs (including current maturities of long term debt) carries interest @ 11.00% p.a. The loan is repayable in 17 monthly instalments (including interest) of Rs.30170/- each (Previous yearRs. 7.63 lacs).

vi) Vehicle loan from HDFC Bank Limited amounting to Rs. 0.26 lacs (including current maturities of long term debt) carries interest @ 11.25% p.a. The loan is repayable in 2 monthly instalments (including interest) of Rs. 13020/- each (Previous yearRs. 1.70 Lacs).

vii) Vehicle loan from HDFC Bank Limited amounting to Rs. 1.73 lacs (including current maturities of long term debt) carries interest @ 10.72% p.a. The loan is repayable in 5 monthly instalments (including interest) of Rs. 35550/- each (Previous year Rs. 5.58Lacs).

viii) Vehicle loan from HDFC Bank Limited amounting to Rs. 5.54 lacs (including current maturities of long term debt) carries interest @ 10.84% p.a. The loan is repayable in 17 monthly instalments (including interest) of Rs. 35300/- each (Previous year Rs. 8.97 lacs).

ix) Vehicle loan from HDFC Bank Limited amounting to Rs. 2.65 lacs (including current maturities of long term debt) carries interest @ 9.82% p.a. The loan is repayable in 18 monthly instalments (including interest) of Rs. 16015/- each (Previous year Rs.4.20 lacs).

x) Vehicle loan from HDFC Bank Limited amounting to Rs. 5.07 lacs (including current maturities of long term debt) carries interest @ 8.90% p.a. The loan is repayable in 22 monthly instalments (including interest) of Rs. 25256/- each (Previous yearRs. 7.48 lacs).

xi) Vehicle loan from HDFC Bank Limited amounting to Rs.5.76lacs (including current maturities of long term debt) carries interest @ 11.00% p.a. The loan is repayable in 21 monthly instalments (including interest) of Rs.30390/- each (Previous yearRs. 8.56 lacs).

xii) Vehicle loan from HDFC Bank Limited amounting to Rs. 2.55 lacs (including current maturities of long term debt) carries interest @ 10.70% p.a. The loan is repayable in 22 monthly instalments (including interest) of Rs. 12912/- each (Previous year Rs.3.74 lacs).

xiii) Vehicle loan from HDFC Bank Limited amounting toRs. 2.54 lacs (including current maturities of long term debt) carries interest @ 9.50% p.a. The loan is repayable in 22 monthly instalments (including interest) of Rs. 12712/- each (Previous yearRs. 3.75 lacs).

xiv) Vehicle loan from HDFC Bank Limited amounting to Rs. 4.55 lacs (including current maturities of long term debt) carries interest @ 10.23% p.a. The loan is repayable in 33 monthly instalments (including interest) of Rs.16050/- each (Previous yearRs. Nil).

xv) Vehicle loan from HDFC Bank Limited amounting to Rs. 6.71 lacs (including current maturities of long term debt) carries interest @ 9.20 % p.a. The loan is repayable in 30 monthly instalments (including interest) of Rs. 25320/- each (Previous yearRs. Nil).

xvi) Vehicle loan from ICICI Bank Limited amounting to Rs.1.43 lacs (including current maturities of long term debt) carries interest @ 11.13% p.a. The loan is repayable in 16 monthly instalments (including interest) of Rs.9750/- each (Previous yearRs. 2.38 lacs).

xvii) Vehicle loan from ICICI Bank Limited amounting to Rs. 3.33 lacs (including current maturities of long term debt) carries interest @ 10.04% p.a. The loan is repayable in 19 monthly instalments (including interest) of Rs. 19056/- each (Previous year Rs. 5.19 lacs). cviii) Vehicle loan from ICICI Bank Limited amounting to Rs. 5.75 lacs (including current maturities of long term debt) carries interest @ 9.82% p.a. The loan is repayable in 21 monthly instalments (including interest) of Rs.25536/- each (Previous yearRs. Nil).

xix) Vehicle loan from Axis Bank Limited amounting to Rs. 51.54 lacs (including current maturities of long term debt) carries interest @ 9.76% p.a. The loan is repayable in 43 monthly instalments (including interest) of Rs. 142528/- each (Previous yearRs. 63.00 lacs).

c) Terms of repayment of term loans from others

i) Repayment schedule of unsecured loans/deposits from related parties is within period of 2 years and carry interest upto 11 % p.a (Previous year upto 11% p.a)

ii) Repayment schedule of unsecured loans/deposits from public is within period of 2 years and carry interest upto 11 % p.a (Previous year upto 11% p.a)

a) Details of security of loans repayable on demand (secured)

i) Secured loans repayable on demand from banks for working capital (* 1149.78 lacs, previous year 11692.81 lacs ) are secured by hypothecation of stocks of raw materials,finished goods, bills receivables, book debts and all other movable assets of the company and further secured by way of second charge on the immovable assets situated at village Banah and at Ahmedgarh and also personally guaranteed by the two promotor directors of the company.

ii) Secured loans repayable on demand from banks against overdraft limit (* 1428.24 lacs, previous year t 0.16 lacs) are secured by lien on current investments.

b) Terms of repayment of short term borrowings

i) Working capital borrowings from banks are repayable on demand and carry interest @ 3% over base rate (Previous year @ 3% over base rate).

ii) Unsecured loans from related parties repayable within one year carry interest upto 11% p.a (Previous year upto 11% p.a).

iii) Unsecured loans from public repayable within one year carry interest upto 11% p.a (Previous year upto 11% p.a).

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Mar 31, 2013

(a) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements are prepared on accrual basis under the historical cost convention in accordance with the accounting standards referred to in sub-section(3C) of section 211 and other relevant provisions of the Companies Act, 1956.

(b) USE OF ESTIMATES

The preparation of financial statements, in conformity with the generally accepted accounting principles, require estimates and assumptions to be made that affect the reported amount of assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialize.

(c) REVENUE RECOGNITION

(i) Revenue from sale is recognised:

(a) When all the significant risks and rewards of ownership are transferred to the buyer and the company retains no effective control of the goods transferred to a degree usually associated with ownership; and

(b) No significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of goods. (ii) The revenue in respect of export incentive is recognised on post export basis.

(iii) Revenue from interest is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. (iv) Dividend from investment is recognized when the right to receive payment is established.

(d) EMPLOYEES BENEFITS

(i) Short Term Employees Benefits

Short Term Employees Benefits are recognized as an expense on an undiscounted basis in the statement of profit and loss of the year in which the related service is rendered

(ii) Post Employment Benefits

Defined Contribution Plan: Contribution to provident fund is made in accordance with the provisions of the Employee''s

Provident Fund and Miscellaneous Provisions Act, 1952 and is recognized as an expense in the statement of profit and loss.

Defined benefit Plans:

a) Gratuity:

Provision for gratuity liability to employees is made on the basis of actuarial valuation as at close of the year.

b) Leave Encashment

Provision for leave encashment is made on the basis of actuarial valuation as at the close of the year.

(iii) The actuarial gain/loss is recognized in the statement of profit and loss

(e) FIXED ASSETS

(i) Fixed assets are stated at historical cost less accumulated depreciation.

(ii) Cost of fixed assets comprises its purchase price and any attributable expenditure (direct and indirect) for bringing an assets to its working condition for its intended use. (iii) Expenditure incurred on renovation/modernisation on the existing fixed assets is added to the book value of these assets where such renovation/modernisation increases the future benefit from them beyond their previously assessed standard of performance. (f) INTANGIBLE ASSETS

Intangible assets are stated at cost less accumulated amount of amortisation. (g) DEPRECIATION

(i) Depreciation is provided on straight line method in accordance with and in the manner specified in Schedule XIV to the

Companies Act, 1956. (ii) Assets costing Rs. 5000/- or less acquired during the year are depreciated at 100%. (h) AMORTISATION

Intangible asset are amortised on straight line method. These assets are amortised over their estimated useful life. (i) CENVAT

Cenvat credit on excise duty/service tax paid on inputs, capital assets and input services is taken in accordance with the Cenvat Credit Rules, 2004. (j) INVENTORIES

Inventories are valued at cost or net realisable value, whichever is lower. The cost in respect of items of inventory is computed as under:

- In case of raw materials at FIFO basis plus direct expenses.

- In case of stores and spares at weighted average cost plus direct expenses.

- In case of work-in-process at raw material cost plus conversion cost depending upon the stage of completion.

- In case of finished goods at raw material cost plus conversion cost, packing cost, excise duty and other overheads incurred to bring the goods to their present condition and location.

(k) INVESTMENTS

Long term Investments are stated at cost less provision, if any, for decline in the value of such investments, which is other than temporary. Current investments are stated at lower of cost and fair value.

(l) FOREIGN CURRENCY TRANSACTIONS

(a) Transactions in foreign currency are recorded on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of transaction except in case of export invoices which are recorded at a rate notified by the custom department for invoice purpose which approximates the actual rate as at the date of transaction. Exchange difference arising on realization of export sale is recognized as income or expense in the period in which they arise.

(b) At each balance sheet date foreign currency monetary items are reported at closing rates. Exchange differences arising on settlement of monetary items or on reporting the same at closing rate as at balance sheet date are recognized as income or expense.

(c) The premium or discount arising at the inception of a forward contract which is not intended for trading or speculation purpose is amortised as expense or income over the life of the contract. Exchange difference on such forward contracts is recognized in the statement of profit or loss in the reporting period in which the exchange rates are charged. Any profit or loss arising on cancellation or renewal of a forward contract is recognised as income or as expense for the period.

(m)BORROWING COSTS

Borrowing costs that are directly attributable to acquisition or construction of a qualifying asset are capitalised as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expenditure in the period in which these are incurred.

(n) GOVERNMENT GRANTS AND SUBSIDIES

Government grants available to the company are recognized when there is a reasonable assurance of compliance with the conditions attached to such grants and when benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made. Government subsidy in the nature of promoter''s contribution is credited to capital reserve. Government subsidy related to specific fixed assets is deducted from the gross value of the assets concerned.

(o) IMPAIRMENT OF ASSETS

At each balance sheet date an assessment is made whether any indication exists that an asset has been impaired. If any such indication exists, an impairment loss i.e. the amount by which the carrying amount of an asset exceeds its recoverable amount is provided in the books of account.

(p) ACCOUNTING FOR TAXES ON INCOME

Provision for taxation for the year comprises of current tax and deferred tax. Current tax is amount of Income-tax determined to be payable in accordance with the provisions of Income tax Act 1961. Deferred tax is the tax effect of timing difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

(q) PROVISIONS AND CONTINGENT LIABILITIES (i) Provision is recognised when:

(a) the company has a present obligation as a result of a past event;

(b) a probable outflow of resources embodying economic benefits is expected to settle the obligation ; and

(c) the amount of the obligation can be reliably estimated (ii) Contingent liability is disclosed in case there is:

(a) Possible obligation that arises from past events and existence of which will be confirmed only by the occurrence or non- occurrence of one or more uncertain future events not wholly within the control of the enterprise ; or

(b) a present obligation arising from past events but is not recognised :

(i) when it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or (ii) a reliable estimate of the amount of the obligation cannot be made. (r) EARNING PER SHARE

Basic earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares. (s) LEASE

The assets acquired on lease wherein a significant portion of risks and rewards of ownership of an asset is retained by the lessor are classified as operating leases. Lease rentals paid for such leases are recognised as an expense on systematic basis over the terms of lease.

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Mar 31, 2012

(a) BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The accounts are prepared on accrual basis under the historical cost convention in accordance with the accounting standards referred to in sub-section(3C) of section 211 and other relevant provisions of the Companies Act, 1956.

(b)USE OF ESTIMATES

The preparation of financial statements, in conformity with the generally accepted accounting principles, require estimates and assumptions to be made that affect the reported amount of assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results materialize

(c) REVENUE RECOGNITION

(I) Revenue from sale is recognised;

(a) When all the significant risks and rewards of ownership transferred to the buyer and the company retains no effective control of the goods transferred to a degree usually associated with ownership; and

(b) No significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of goods.

(ii) The revenue in respect of export incentives i.e. duty entitlement pass book scheme benefit is recognised on post export basis.

(iii) Revenue from interest is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

(iv) Dividend from investment is recognized when the right to receive payment is established.

(d)EMPLOYEES BENEFITS

(i) Short Term Employees Benefits

Short Term Employees Benefits are recognized as an expense on an undiscounted basis in the statement of profit and loss of the year in which the related service is rendered

(ii) Post Employment Benefits

Defined Contribution Plan: Contribution to provident fund is made in accordance with the provisions of the Employee's Provident Fund and Miscellaneous Provisions Act, 1952 and is recognized as an expense in the statement of profit and loss

Defined benefit Plans

a) Gratuity:

Provision for gratuity liability to employees is made on the basis of actuarial valuation as at close of the year.

b) Leave Encashment

Provision for leave encashment is made on the basis of actuarial valuation as at the close of the year.

(iii) The actuarial gain/loss is recognized in the statement of profit and loss

(e) FIXED ASSETS

(i) Fixed assets are stated at historical cost less accumulated depreciation.

(ii) Cost of fixed assets comprises its purchase price and any attributable expenditure (direct and indirect) for bringing an assets to its working condition for its intended use.

(iii) Expenditure incurred on renovation/modernisation on the existing fixed assets is added to the book value of these assets where such renovation/modernisation increases the future benefit from them beyond their previously assessed standard of performance.

(f) INTANGIBLE ASSETS

Intangible assets are stated at cost less accumulated amount of amortisation.

(g) DEPRECIATION

( i) Depreciation is provided on straight line method in accordance with and in the manner specified in Schedule XIV to the Companies Act, 1956.

(ii) Assets costing Rs. 5000/- or less acquired during the year are depreciated at 100%.

(h) AMORTISATION

Intangible asset are amortised on straight line method. These assets are amortised over their estimated useful life.

(i) CENVAT

Cenvat credit on excise duty paid inputs, capital assets and input services is taken in accordance with the Cenvat Credit Rules, 2004.

(j) INVENTORIES

Inventories are valued at cost or net realisable value, whichever is lower. The cost in respect of items of inventory is computed as under:

- In case of raw materials at FIFO basis plus direct expenses.

- In case of stores and spares at weighted average cost plus direct expenses.

- In case of work-in-process at raw material cost plus conversion cost depending upon the stage of completion.

- In case of finished goods at raw material cost plus conversion cost, packing cost, excise duty and other overheads incurred to bring the goods to their present condition and location.

(k) INVESTMENTS

Long term Investments are stated at cost less provision, if any, for decline in the value of such investments, which is other than temporary. Current investments are stated at lower of cost and fair value.

(l) FOREIGN CURRENCY TRANSACTIONS

(a) Transactions in foreign currency are recorded on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and foreign currency at the date of transaction except in case of export invoices which are recorded at a rate notified by the custom department for invoice purpose which approximates the actual rate as at the date of transaction. Exchange difference arising on realization of export sale is recognized as income or expense in the period in which they arise.

(b) At each balance sheet date foreign currency monetary items are reported at closing rates. Exchange differences arising on settlement of monetary items or on reporting the same at closing rate as at balance sheet date are recognized as income or expense.

(m)BORROWING COSTS

Borrowing costs that are directly attributable to acquisition or construction of a qualifying asset are capitalised as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expenditure in the period in which these are incurred.

(n) GOVERNMENT GRANTS AND SUBSIDIES

Government grants available to the company are recognized when there is a reasonable assurance of compliance with the conditions attached to such grants and when benefits in respect there of have been earned and it is reasonably certain that the ultimate collection will be made. Government subsidy in the nature of promoter's contribution is credited to capital reserve. Government subsidy related to specific fixed assets is deducted from the gross value of the assets concerned.

(o) IMPAIRMENT OF ASSETS

At each balance sheet date an assessment is made whether any indication exists that an asset has been impaired. If any such indication exists, an impairment loss i.e. the amount by which the carrying amount of an asset exceeds its recoverable amount is provided in the books of account.

(p) ACCOUNTING FOR TAXES ON INCOME

Provision for taxation for the year comprises of current tax and deferred tax. Current tax is amount of Income-tax determined to be payable in accordance with the provisions of Income tax Act 1961. Deferred tax is the tax effect of timing difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

(q) PROVISIONS AND CONTINGENT LIABILITIES

(i) Provision is recognised (for liabilities that can be measured by using a substantial degree of estimation) when:

(a) the company has a present obligation as a result of a past event;

(b) a probable outflow of resources embodying economic benefits is expected to settle the obligation ; and

(c) the amount of the obligation can be reliably estimated

(ii) Contingent liability is disclosed in case there is:

a) Possible obligation that arises from past events and existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the enterprise ; or

b) a present obligation arising from past events but is not recognised

(i) when it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or (ii) a reliable estimate of the amount of the obligation cannot be made.

(r) EARNING PER SHARE:

Basic earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

(s) LEASE

The assets acquired on lease wherein a significant portion of risks and rewards of ownership of an asset is retained by the lessor are classified as operating leases. Lease rentals paid for such leases are recognised as an expense on systematic basis over the terms of lease.

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Mar 31, 2011

(a) Basis of Preparation of Financial Statements

The accounts are prepared on accrual basis under the historical cost convention in accordance with the accounting standards referred to in sub-section(3C) of section 211 and other relevant provisions of the Companies Act, 1956.

(b) Use of Estimates

The preparation of financial statements, in conformity with the generally accepted accounting principles, require estimates and assumptions to be made that affect the reported amount of assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results materialize.

(c) Revenue Recognition

(i) Sales comprise sale of goods and export incentives. Revenue from sale of goods is recognised;

(a) When all the significant risks and rewards of ownership transferred to the buyer and the company retains no effective control of the goods transferred to a degree usually associated with ownership; and

(b) No significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of goods. (ii) The revenue in respect of export incentives i.e. duty entitlement pass book scheme benefit is recognised on post export basis.

(iii) Revenue from interest is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

(iv) Dividend from investment is recognized when the right to receive payment is established.

(d) Employees Benefits

(i) Short Term Employees Benefits

Short Term Employees Benefits are recognized as an expense on an undiscounted basis in the profit and loss account of the year in which the related service is rendered.

(ii) Post Employment Benefits

Defined Contribution Plan: Contribution to provident fund is made in accordance with the provisions of the Employee's Provident Fund and Miscellaneous Provisions Act, 1952 and is recognized as an expense in the profit and loss account.

Defined Benefit Plans

a) Gratuity:

Provision for gratuity liability to employees is made on the basis of actuarial valuationas at close of the year.

b) Leave Encashment

Provision for leave encashment is made on the basis of actuarial valuation as at the close of the year. (iii)The actuarial gain/loss is recognized in the statement of profit and loss account.

(e) FIXED ASSETS

(i) Fixed assets are stated at historical cost less accumulated depreciation.

(ii) Cost of fixed assets comprises its purchase price and any attributable expenditure (direct and indirect) for bringing an assets to its working condition for its intended use.

(iii) Expenditure incurred on renovation/modernisation on the existing fixed assets is added to the book value of these assets where such renovation/modernisation increases the future benefit from them beyond their previously assessed standard of performance.

(f) INTANGIBLE ASSETS

Intangible assets are stated at cost less accumulated amount of amortisation.

(g) DEPRECIATION

(i) Depreciation is provided on straight line method in accordance with and in the manner specified in Schedule XIV to the Companies Act, 1956.

(ii) Assets costing Rs. 5000/- or less acquired during the year are depreciated at 100%.

(h) AMORTISATION

Intangible asset are amortised on straight line method. These assets are amortised over their estimated useful life.

(i) CENVAT

Cenvat credit on excise duty paid inputs, capital assets and input services is taken in accordance with the Cenvat Credit Rules, 2004.

(j) INVENTORIES

Inventories are valued at cost or net realisable value, whichever is lower. The cost in respect of items of inventory is computed as under:

- Incase of raw materials at FIFO basis plus direct expenses.

- In case of stores and spares at weighted average cost plus direct expenses.

- In case of work-in-process at raw material cost plus conversion cost depending upon the stage of completion.

- In case of finished goods at raw material cost plus conversion cost, packing cost, excise duty and other overheads incurred to bring the goods to their present condition and location.

(k) INVESTMENTS

Long term Investments are stated at cost less provision, if any, for decline in the value of such investments, which is other than temporary. Current investments are stated at lower of cost and fair value.

(l) FOREIGN CURRENCY TRANSACTIONS

(a) Transactions in foreign currency are recorded on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and foreign currency at the date of transaction except in case of export invoices which are recorded at a rate notified by the custom department for invoice purpose which approximates the actual rate as at the date of transaction. Exchange difference arising on realization of export sale is recognized as income or expense in the period in which they arise.

(b)At each balance sheet date foreign currency monetary items are reported at closing rates. Exchange differences arising on settlement of monetary items or on reporting the same at closing rate as at balance sheet date are recognized as income or expense.

(m) BORROWING COSTS

Borrowing costs that are directly attributable to acquisition or construction of a qualifying asset are capitalised as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expenditure in the period in which these are incurred.

(n) SUBSIDY

Government grants available to the company are recognized when there is a reasonable assurance of compliance with the conditions attached to such grants and when benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made. Government subsidy in the nature of promoter's contribution is credited to capital reserve. Government subsidy related to specific fixed assets is deducted from the gross value of the assets concerned.

(o) IMPAIRMENT OF ASSETS

At each balance sheet date an assessment is made whether any indication exists that an asset has been impaired. If any such indication exists, an impairment loss i.e. the amount by which the carrying amount of an asset exceeds its recoverable amount is provided in the books of account.

(p) ACCOUNTING FOR TAXES ON INCOME

Provision for taxation for the year comprises of current tax and deferred tax. Current tax is amount of Income-tax determined to be payable in accordance with the provisions of Income tax Act 1961. Deferred tax is the tax effect of timing difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

(q) PROVISIONS AND CONTINGENT LIABILITIES

(i) Provision is recognised (for liabilities that can be measured by using a substantial degree of estimation) when:

(a) the company has a present obligation as a result of a past event;

(b) a probable outflow of resources embodying economic benefits is expected to settle the obligation ; and

(c) the amount of the obligation can be reliably estimated

(ii) Contingent liability is disclosed in case there is:

a) Possible obligation that arises from past events and existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the enterprise ; or

b) a present obligation arising from past events but is not recognised

(i) when it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or (ii) a reliable estimate of the amount of the obligation cannot be made.

(r) EARNING PER SHARE:

Basic earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

(s) LEASE

The assets acquired on lease wherein a significant portion of risks and rewards of ownership of an asset is retained by the lessor are classified as operating leases. Lease rentals paid for such leases are recognised as an expense on systematic basis over the terms of lease.

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Mar 31, 2010

(a) Accounting Conventions

The accounts are prepared on accrual basis under the historical cost convention in accordance with the accounting standards referred to in sub-section(3C) of section211 andother relevant provisions of the CompaniesAct, 1956

(b) Revenue Recognition

(i) Revenue from sale of goods is recognised;

(a) When all the significant risks and rewards of ownership transferred to the buyer and the company retains no effective control of the goods transferred to a degree usually associated with ownership; and

(b) No significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of goods. (ii)The revenue in respect of Export incentives i.e. Duty Entitlement Pass Book Scheme benefit is recognised on post export basis.

(c) Use of Estimates

The preparation of financial statements, in conformity with the generally accepted accounting principles, require estimates and assumptions to be made that effect the reported amount of assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting-period. Difference between the actual results and estimates are recognised in the period in which the results materialise.

(d) Employees Benefits

(i) Short Term Employees Benefits

Short Term Employees Benefits are recognized as an expense on an undiscounted basis in the Profit and Loss Account of the year in which the related service is rendered.

ii) Post Employment Benefits Defined Contribution Plan:

Contribution to provident fundis made in accordance with the provisions of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 and is recognized as an expense in the profitand loss account.

Defined Benefit Plans

a) Gratuity:

Provision for gratuity liability to employees is made on the basis of actuarial valuation as at close of the year.

b) Leave Encashment

Provision for leave encashment is made on the basis of actuarial valuation as at the close of the year iii) The actuarial gain/loss is recognized in the statement of profit and loss account.

(e) FIXEDASSETS

i) Fixed assets are stated at historical cost less accumulated depreciation.

ii) Expenditure incurred on renovation/modernisation on the existing fixed assets is added to the book value of these assets where such renovation/modernisation increases the future benefit from them beyond their previously assessed standard of performance.

(f) INTANGIBLEASSETS

Intangible assets are stated at cost less accumulated amount of amortisation.

(g) DEPRECIATION

i) Depreciation is provided on straight line method in accordance with and in the manner specified in Schedule XIV to the CompaniesAct, 1956. ii) Assets costing Rs. 5000/- or less acquired during the year are depreciated at 100%. (h) AMORTISATION

Intangible asset are amortised on straight line method. These assets are amortised over their estimated useful life. (I) C EN VAT .-Cenvat credit on excise duty paid inputs, capital assets and input services is taken in accordance with the Cenvat Credit Rules. 2004. "(j) INVENTORIES

Inventories a re valued at cost or net rea lisa ble va lue, whichever is lower. The cost in respect of items of inventory is co mputed asunder:

In case of raw materials at FIFO basis plus direct expenses. In case of stores and spares at weighted average cost plus direct expenses.

In case of work-in-process at raw material cost plus conversion cost depending upon the stage of completion. In case of finished goods at raw material cost plus conversion cost, packing cost, excise duty and other overheads incurred to bring the goods to their present condition and location.

(k) INVESTMENTS

Long term Investments are stated at cost less provision, if any, for decline in the value of such investments, which is other than temporary. Current investments are stated at lower of cost and fair value.

(I) FOREIGN CURRENCYTRANSACTIONS

(a) Transactions in foreign currency are recorded on initial recognition in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and foreign currency at the rate of transaction except in case of export invoices which are recorded at a rate notified by the custom department for invoice purpose which approximates the actual rate as at the date of transaction. Exchange difference arising on realization of export sale is recognized as income or expense in the period in which they arise.

(b) At each balance sheet data foreign currency monetary items are reported at closing rates Exchange differences arising on restatement of monetary items at closing rates are recognized as income or expense.

(m) BORROWING COSTS

Borrowing costs that are directly attributable to acquisition or construction of a qualifying asset a re capitalised as a part of cost of such asset. Qualifying asset is one that takes substantial period of time to get ready for its intended use. All other borrowing costs are recognised as expenditure in the period in which these are incurred.

(n) SUBSIDY

Government grants available to the company are recognized when there is a reasonable assurance of compliance with the conditions attached to such grants and when benefits in respect thereof have been earned and it is reasonably certain that the ultimate collection will be made. Government subsidy in the nature of promoters contribution is credited to capital reserve Government subsidy related to specific fixed assets is deducted fromthe gross value of the assets concerned.

(O) EXPENDITURE DURING CONSTRUCTION PERIOD

Other indirect expenditure incurred during construction period in respect of major expansions / new units are capitalised on various categories of fixed assets on proportionate basis.

(p) IMPAIRMENTOFASSETS

At each balance sheet date an assessment is made whether any indication exists that an asset has been impaired. If any such indication exists, an impairment loss i.e. the amount by which the carrying amount of an asset exceeds its recoverable amount is provided in the books of account.

(q) ACCOUNTING FOR TAXES ON INCOME

Provision for taxation for the year comprises of current tax and deferred tax. Current tax is amount of Income-tax determined to be payable in accordance with the provisions of Income tax Act 1961. Deferred tax is the tax effect of timing difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

(r) PROVISIONS AND CONTINGENT LIABILITIES

(i) Provision is recognised (for liabilities that can be measured by using a substantial degree of estimation) when: (a) the company has a presentobligationasa result of a past event;

(b)a probable outflow of resources embodying economic benefits is expected to settle the obligation ; and (c) the a mount of the obligation can be reliably estimated (ii) Contingent liability is disclosed in case there is:

a) Possible obligation that arises from past events and existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the enterprise ,

b) a present obligation arising from past events but is not recognised

(i) when it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or (ii) a reliable estimate of the amount of the obligation cannot be made.

(s) EARNING PER SHARE:

Basic earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the affects of all dilutive potential equity shares.

(t) LEASE

The assets acquired on lease where in a significant portion of risks and rewards of ownership of an asset is retained by the -lessor are classified as operating leases. - Lease rentals paid for such leases are recognised as an expense on systematic basis over the terms of lease.