The Description of the nature and purpose of each reserve within Other Equity is as follows:
Securities Premium : The amount of difference between the issue price and the face value of the shares is recognized in Securities premium reserve. It is utilised in accordance with the provisions of the Act.
Capital Reserve: The Capital Reserve was recognized as a result of investment subsidy received for Visaka Cements Works, Vizag during the accounting year ended on Mach 31, 1981. This reserve is not freely available for distribution to the shareholders. Addition includes Capital Reduction persuant to implementation of Approved Resolution Plan. Capital Redemption Reserve: The company had created Capital Redemption Reserve out of the profits for redemption of Preference Shares. This reserve may be utilized for the specified purpose in accordance with the provisions of the Act.
Quary Land Amortization Reserve: Quary Land Amortization Reserve was created for subsidy granted by the Government for construction of residential quarters for workers at Jayantipuram mines.
Retained Earnings: Retained Earnings comprise of the profits/(losses) of the company earned till date net of distributions and other adjustments.
Other Comprehensive Income : Other Comprehensive Income comprise re-measurement of defined benefit plans (net).
18.1.1 The Company has used the borrowings from banks and financial institutions for specific purpose for which it was taken.
18.1.2 Outstanding amount of Rs. 3,893.98 lakhs as on June 30, 2019, in respect of earlier financial assistance have converted into new financial assistance w.e.f. July 01,2019.
18.1.3 Satisfaction of Charge is pending for Registration with ROC of Andhra Pradesh, Vijayawada, for Loan from M/s. Karur Vysya Bank w.e.f. 05.03.2022 due to technical reasons.
18.1.4 During the Financial year ended March 31,2020, Andhra Bank and Karur Vasya Bank declared the term loans as Non-Performing Assets(NPA) and recalled the entire amount including interest there on. Hence, outstanding term loans from Andhra bank and Karur Vasya Bank have been classified as "Loan Repayable on Demand" under “Current Borrowings”. During the previous Financial Year M/s. Pridhvi Asset Reconstruction and Securitisation Company Ltd (PARAS) have recalled all loans assigned to them vide their letter dated 07.02.2022. Hence entire Term Loan have been classified as "Loan Repayable on Demand" under “Current Borrowings”.
18.1.5 EARC (Edelweiss Asset Reconstruction Company Ltd.) has takenover Outstanding Loan of HDFC Limited as on 31.03.2021.
18.1.6 M/s. EARC (Edelweiss Asset Reconstruction Company Ltd.) and M/s. Karur Vysya Bank have assigned their loans to M/s. Pridhvi Asset Reconstruction and Securitisation Company Ltd (PARAS) vide their letters dated 04.02.2022 and 03.02.2022 respectivelly.
18.1.7 During the Current Financial year, the Company had availed Rs. 60,000 Lakhs term loan from State Bank of India Limited as part of implementation of Resolution Plan. The term loan is repayable in 39 installments starting from 30.06.2024. Transaction cost Rs. 546 (Rs. Nil) Lakhs is not included in borrowings. The same is being amortise thru Finance Cost over the period of Loan.
18.1.8 During the Current Financial year, the Company had availed Rs. 2,000 Lakhs unsecured loan from Sagar Cements Limited (Holding Company) as part of implementation of Resolution Plan.
18.1.9 Since all the loans by Banks and Financial Institutions have been recalled in previous years, Details relating to Previos Default in Payment of Principal and interest has been omitted. Entire recalled loan and interest thereon is in default from the date they have been recalled.
18.2 The Company was not declared wilful defaulter by any bank or financial Institution or other lender.
18.3 The Company had repaid the all the loans existing as on March 31,2022 for the amount proposed in the resolution plan and the balance amount has been extinguished. (Also refer Note 36 and 37).
During the current financial year, Since there are reliable financial projections reflecting future taxable income, the Company had recognised the net deferred tax assets. Arising on account of unabsorbed depreciation and expenditure allowed on payment basis only. For the previous Financial year 2021-22, the Company has recognized Deferred tax assets arising on account of unabsorbed depreciation and expenditure allowed on payment basis only to the extent of the deferred tax liabilities arising on account of the timing difference considering the fact that it is not probable that sufficient taxable income will be available in the future against which such the deferred tax assets can be realized in the normal course of business of the company.
21.1 M/s. Karur Vysya Bank and M/s. State Bank of India have assigned their Working Capital Facilities to M/S Pridhvi Asset Reconstruction and Securitisation Company Ltd (PARAS) vide their letter dated 03.02.2022 and 22.07.2022 respectivelly, included in ( c) above.
21.2 M/s. EARC (Edelweiss Asset Reconstruction Company Ltd.) and M/s. Karur Vysya Bank have assigned their loans to M/s. Pridhvi Asset Reconstruction and Securitisation Company Ltd (PARAS) vide their letters dated 04.02.2022 and 03.02.2022 respectivelly included in (a) above.
21.3.1 The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken.
21.3.2 The Company was not declared wilful defaulter by any bank or financial Institution or other lender.
21.4 The Company had repaid the all the loans existing as on March 31,2022 for the amount proposed in the resolution plan and the balance amount has been extinguished. (Also refer Note 36 and 37)
*Working Capital Loans from banks, repayable on demand were secured by first pari passu charge by way of hypothecation of the current assets and second Charge on property, plant and equipment of the company. These loans are further secured by personal guarantee of Shri. Manoj Gaur (Ex-Chairman).
36. (i) The Company has incurred losses of Rs. 8,793.30 lakhs for the financial year ended March 31, 2023 before exceptional items and however due to implementation of resolution plan the gain has been recognized on account of reversal of liabilities after settlements, the accumulated losses were reduced to of Rs. 36,198.26 lakhs. as at March 31,2023.
(ii) National Company Law Tribunal (“NCLT”), Amaravati Bench vide order dated April 26, 2022 (“Order”) has initiated Corporate Insolvency Resolution Process (“CIRP”) against Company pursuant to an application u/s 7 of the Insolvency and Bankruptcy Code, 2016 (the “Code”) filed by Pridhvi Asset Reconstruction and Securitisation Company Limited, one of the financial creditors of the Company.
The National Company Law Tribunal (“NCLT”), Amaravati Bench vide its order dated February 16, 2023 (“Order”) has since approved the resolution plan submitted by Sagar Cements Limited (SCL) for acquisition and revival of Andhra Cements Limited (ACL). Basis this SCL has completed the resolution process within the prescribed time and became the holding company of ACL by subscribing to 95% of the revised paid up capital of the company.
(iii) Post completion of the resolution process under the supervision of the monitoring committee (MC) which was constituted as per the mandate given in the NCLT order SCL got the control of ACL with effect from March 18 2023, post dissolution of the MC and to maintain the Company as a going concern. Considering the above facts, the financial statements of the Company for the financial year 2022-23 have been prepared on a going concern basis.
In addition to the above, an amount of ' 504 Lakhs towards interim management cost and an amount of ' 15,479 Lakhs is proposed for improving the operations of the Company.
Pursuant to implementation of Resolution Plan Erstwhile promoter's fully paid up 20,17,41,371 Equity shares have been canceled and public shareholdings have been reduced from 9,17,79,121 Equity shares to 46,08,607 Equity shares of Rs. 10/- each i.e reduced to 5% of the reconstituted paid up Equity Share capital of the Company. The Board of Directors of the company in its meeting held on 23rd March 2023 approved allotment of 8,75,63,533 fully paid equity shares Rs.10/- each to Sagar Cements Limited with a premium of Rs.26.80 per share, aggregating to Rs.322.23 crores, representing 95% of the equity share capital of the Company.
(ii) As per the approved resolution plan, all claims have been settled and remaining liability stands extinguished and accounted as exceptional item.
38. CIF Value of Imports: - for the year ended on 31.03.2023 is Rs. Nil (Nil)
39. Information as required to be furnished as per section 22 of Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) for the year ended March 31, 2023 is given below. This information has been determined to the extent such parties have been identified on the basis of information available with the company;
40. The Company is exclusively engaged in the business of cement and cement related products. As per Ind AS 108 “Operating Segments”, specified under Section 133 of the Companies Act, 2013, there is no reportable segment applicable to the Company.
41. The Company has adopted Ind AS 116 effective 1st April, 2019, as the company does not have any finance lease assets so there is no any significant effect of the said change. The Company incurred Rs. 10.61 lakhs (Rs.20.03 lakhs) for the year ended 31st March, 2023 towards expenses relating to short-term leases and leases of low-value assets.
The sensitivity analysis above has been determined based on reasonably possible changes of the respective assumption occurring at the end of the reporting period and may not be representative of the actual change. It is based on a change. It is based on a change in the key assumption while holding all other assumptions constant. When calculating the sensitivity to the assumption, the method (Projected Unit Credit Method) used to calculate the liability recognized in the balance sheet has been applied. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared with the previous period.
The estimate of rate of escalation is salary considered in actuarial valuation, taken into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is as certified by the actuary.
43. Fair Value
The fair value of the financial assets are included at amounts at which the instruments could be exchanged in a current transaction between willing parties other than in a forced or liquidation sale.
The following methods and assumptions were used to estimate the fair value:
(a) Fair value of cash and short term deposits, trade and other short term receivables, trade payables, other current liabilities, approximate their carrying amounts largely due to the short-term maturities of these instruments.
(b) Financial instruments with fixed and variable interest rates are evaluated by the Company based on parameters such as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances are taken to account for the expected losses of these receivables.
44. Financial risk management and policies 44.1 Capital Risk Management
For The purpose of the Company's capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company's capital management is to maximize the shareholder value.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company's policy is to keep optimum gearing ratio. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents, excluding discontinued operations.
44.2 Financial-Risk-Management
The Company's principal financial liabilities comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance and support the Company's operations. The Company's principal financial assets comprise investments, cash and bank balance, trade and other receivables.
The Company is exposed to various financial risks such as market risk, credit risk and liquidity risk. The financial risks are identified, measured and managed in accordance with the Company's policies and risk objectives.
a) Market Risk
The Company's activities expose it primarily to the financial risk of changes in foreign currency exchange rates and changes in interest rates. There have been no changes
to the Company's exposure to market risk or the manner in which it manages and measures the risk in recent past.
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risk: interest rate risk and currency risk. Financial instruments affected by market risk include borrowings and bank deposits.
(i) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The particulars relating to Company's exposure to the risk of changes in market interest rates as at reporting date is given below:
(ii) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company's exposure to the risk of changes in foreign exchange rates relates primarily to import of store and spare and other materials. The Company's foreign currency risks are identified, measured and managed at periodic intervals in accordance with the Company's policies.
b) Credit Risk:
Credit risk is the risk that counterparty will default on its contractual obligations resulting in financial loss to the company. The Company has adopted a policy of only dealing with creditworthy customers.
In many cases an appropriate advance as security deposits or letter of credit / bank guarantee is taken from the customers to cover the risk. In other cases, credit limit is granted to customer after assessing the credit worthiness based on the information supplied by credit rating agencies, publicly available financial information or its own past trading records and trends.
At March 31, 2023, the company did not consider there to be any significant concentration of credit risk, which had not been adequately provided for. The carrying amount of the financial assets recorded in the financial statements, grossed up for any allowances for losses, represents the maximum exposure to credit risk.
c) Liquidity Risk
Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of credit facilities to meet obligations when due. The Company's treasury team is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company's liquidity position through rolling forecasts on the basis of expected cash flows.
45. The Company is not required to incur any amount on account of Corporate Soci Responsibility (CSR) as the average profit before tax during the preceding three financi year is negative.
During the current financial year, since there are reliable financial projections reflecting future taxable income, the Company had recognised the net deferred tax assets arising on account of unabsorbed depreciation and expenditure allowed on payment basis only. For the previous Financial year 2021-22, the Company has recognized Deferred tax assets arising on account of unabsorbed depreciation and expenditure allowed on payment basis only to the extent of the deferred tax liabilities arising on account of the timing difference considering the fact that it is not probable that sufficient taxable income will be available in the future against which such the deferred tax assets can be realized in the normal course of business of the company..
1. It includes value of perquisites.
2. It represents Contribution to Provident fund.
3. As the liability for gratuity and compensated absence are provided on actuarial basis for the Company as a whole, amounts accrued pertaining to key managerial personnel are not included in above.
4. No amount pertaining to related parties which have been provided for as doubtful debts or written off.
49 The Company has not given advances in the nature of loans whose particulars are required to be disclosed in terms of Regulation 34(3) and 53(f) of the Listing obligation and Disclosure Requirement.
54 During the financial year the company has converted the method of depreciation from SLM to WDV for assets other than Plant & Machinery and Railway Siding. There is no material effect with respect to change in method of depreciation during the year ended March 31, 2023. The net impact debited to statement of profit and loss during the current financial year is ' 23 lakhs.
55 All amounts in the financial statements are presented in Lakhs with two decimal except per share data and as otherwise stated. Figures in brackets represent corresponding previous year figures. Previous year's figures have been regrouped /rearranged wherever considered necessary.
See accompanying notes to the financial statements.
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