20.2 Term loans II & III sanctioned by Axis Bank Ltd are secured by exclusive first charge on fixed assets created out of the term loans extended by the term lender and paripassu first charge on the movable fixed assets (Except vehicles) and immovable fixed assets of the Company (including EM of the Company land and buildings but excluding agricultural lands lying in the name of the Company not charged to any bank) along with other lenders and personal guarantee of Sri S Chandra Sekhar, Managing Director of the Company & Smt. S Lalitha Sree, Director of the Company.

20.3 Term Loans sanctioned under GECL 2.0 of H 290 Lakhs & H 179 Lakhs by State Bank of India & Axis Bank Ltd, respectively are secured by extension of charge / security interest (both primary & collateral ) currently secured to the banks for their existing credit facilities on a second ranking basis.

20.4 Government of Andhra Pradesh vide letter No.20/2/6/1369/ID dated 08-10-1996 and letter No.30/1/2002/0300/0300/ FD dated 10-04-2002 had sanctioned sales tax deferment for an amount of H 918.54 Lakhs and H 514.51 Lakhs respectively for a period of 14 years to the Company in respect of Chlorpyriphos plant. The sanction of H 918.54 Lakhs under letter No.20/2/6/1369/ID dated 08-10-1996 has expired its utilization on 28th February, 2010 and sanction of H 514.51 Lakhs under letter No.30/1/2002/0300/0300/FD dated 10-04-2002 has expired its utilisation on 14th February, 2016. The Company has availed an aggregate deferment loan of H 563.17 Lakhs under the above sanctions. The repayment has commenced and an amount of H 266.70 Lakhs has been paid. However, the deferment amount payable for the years 19-20, 2020-21 & 2021-22 aggregating to H 62.20 Lakhs was placed in the form of fixed deposits with banks as per orders of the Honourable High Courts of AP & TG. Thus the liability under sales tax deferment reflected is inclusive of the above deposits.

20.5 Loans availed from Intercorporates have been taken with the repayment period of two years from the date of availing such loan. The Interest is paid at the rate of 8.5% per annum on the principal outstanding.

20.6 Loans availed from Directors have been taken with the repayment period of two years from the date of availing such loan. The Interest is paid at the rate of 8.5% per annum on the principal outstanding.

20.7 The company has not been declared a wilful defaulter (as defined by RBI Circular) by any bank or financial Institution or other lender.

20.8 The Company does not have any charges or satisfaction which are yet to be registered with ROC beyond the statutory period.

20.9. a. The Company has not obtained term loan from any Bank/ Financial Institution during the financial year 2021-22.

20.9. b. The Company has obtained term loan from following Bank/ Financial Institution during the financial year 2020-21.

24 FINANCIAL LIABILITIES - BORROWINGS (Contd..)

1. For Limits sanctioned by SBI, Axis & RBL Banks

i) Primary Security for working captial loans:

Pari Passu first charge on current assets of the Company.

ii) Collateral Security :

Paripassu firtst charge on movable fixed assets of the Company (both present and future) except vehicles and assets created out of term loans from Axis Bank Ltd and equitable mortagage of the company's factory land and buildings in an extent of 71.68 acres situated at Cheruvukommupalem, Ongole.

Pari Passu Second charge is available to SBI, ICICI Bank Ltd & RBL Bank Ltd by way of hypothecation on the movable fixed assets of the Company financed by Axis Bank Ltd.

iii) Primary security for Term Loans sanctioned by Axis Bank Limited- Exclusive charge by way of hypothecation on the assets created out of term loans sanctioned by Axis Bank Limited.

iv) Personal Guarantee of Sri. S Chandra Sekhar, Managing Director and Smt. S Lalitha Sree Director of the Company.

2. For Limits sanctioned by ICICI Bank Ltd, the following securities are stipulated- Cash Credit and LC limits

i. Primary Security:

First Paripassu charge on current assets of the company, both present and future along with other working capital member banks.

ii. Collateral securities:

First paripassu charge on entire fixed assets (Movable and Immovable) (except vehicles and assets financed exclusively by other banks and assets financed by Axis bank by way of term loans)both present and future along with other working capital member banks on Factory land and building property in Cheruvukommupalem, Prakasam district, Andhra Pradesh

iii) Second Paripassu charge on movable fixed assets of the company created out of term loans from Axis bank.

3. For Limits sanctioned by ICICI Bank Ltd, the following securities are stipulated- Over Draft Limit

i) Primary Security:

First Paripassu charge on current assets of the company, both present and future along with other working capital member banks.

ii) Collateral securities:

First paripassu charge on entire fixed assets (Movable and Immovable) (except vehicles and assets financed exclusively by other banks and assets financed by Axis bank by way of term loans)both present and future along with other working capital member banks on Factory land and building property in Cheruvukommupalem, Prakasam district, Andhra Pradesh

iii) Second Paripassu charge on movable fixed assets of the company created out of term loans from Axis bank.

iv) Exclusive collateral in the name of Bheema Fine Chemicals Pvt Ltd, situated at village Kadechur,Hobli,585102, Yadgir dist, Karnataka of leasehold industrial land in 33.90 acres.

v) The facilities are secured by personal guarantees of Mr S Chandra Sekhar and Smt. S. Lalitha Sree, Directors.

25.2 The management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of Micro and Small Enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 (MSMEDA). Accordingly, the disclosure in respect of the amounts payable to such enterprises as at 31 March 2022 has been made in the financial statements based on information received and available with the Company.

38 Exceptional Item - Insurance Claim :

An amount of H 105 Lakhs was received during the financial year 2020-21 as full & final settlement under the reinstatement policy for damage to Civil structures, Plant and Electrical Equipment which was disclosed as Income from Insurance claim as exceptional Item.

39 Other Comprehensive Income (OCI)

The disaggregation of changes to OCI by each type of reserve in equity is shown below:

Other comprehensive income not to be reclassified to profit or loss in subsequent periods:

Nature of CSR activities - For promotion of Healthcare, Environmental Sustainability & Education.

As Per section 135 of the Companies Act, 2013, amount required to be spent by the Company during the year ended March 31, 2022 was H 46.89 Lakhs Computed at 2% of its average net profits for the immediately preceding three financial years, on Corporate Social Responsibility (CSR). The Company spent an amount of H 46.89 Lakhs against this obligation for promotion of Healthcare, Environmental Sustainability & Education.

42 EARNINGS PER SHARE

42.1 Earnings per share is calculated by dividing the profit attributable to the equity shareholders by the weighted average number of equity shares outstanding during the year.

Diluted earnings /(loss) per share amounts are calculated by dividing the profit/loss attributable to equity holders by the weighted average number of equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on conversion of all the dilutive potential equity shares into equity shares.

45 During the year 2018-19, Company paid H 26.21 Lakhs and H 13.71 Lakhs on account of CVD and SAD towards shortfall quantity of their export obligation in respect of two advance authorization licences granted to it. The Company has filed for a refund of the CVD & SAD as per the provisions of Sec. 142(3) of CGST Act. Refund application of the Company has been rejected by the Asst. Commissioner of Central Taxes, CGST Division vide its order dated 14.05.2020. Later, the Company made an Appeal with the Commissioner of Appeals, which was also rejected, vide

order dated 30.10.2020. On 28.01.2021, the Company preferred further appeal with The Customs, Excise and Service Tax Appellate Tribunal Regional Bench, Hyderabad which is admitted by the Appellate Tribunal vide letter dated 2106-2021. Hence, no provision is made in the books of the Company.

46 SEGMENT REPORTING :

a. BASIS OF SEGMENTATION

The company operates only in one business segment viz. ‘manufacturing and sales of agro chemicals' and hence no separate information for primary segment wise disclosure is required.

53 FAIR VALUES OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES

The fair value of other current financial assets, cash and cash equivalents, trade receivables investments trade payables, short-term borrowings and other financial liabilities approximate the carrying amounts because of the short term nature of these financial instruments.

The amortized cost using effective interest rate (EIR) of non-current financial assets consisting of security and term deposits are not significantly different from the carrying amount.

Financial assets that are neither past due nor impaired include cash and cash equivalents, security deposits, term deposits, and other financial assets.

Non-current borrowing comprises term loan from the banks. The impact of fair value on such portion is not material and therefore not considered for above disclosure.

Non-current borrowings comprises of Inter corporate borrowing has been valued at amortised cost using Effective Interest Rate (EIR).

Financial Risk Management objectives & Policies

The Company's financial risk management is an integral part of how to plan and execute its business strategies. The Company's activity exposes it to market risk, commodity risk and credit risk. In order to minimise any adverse effects on the financial performance of the Company, the Company evaluates various options and may enter into derivative financial instruments like foreign exchange forward contracts, foreign currency option contracts in order to hedge certain foreign currency risk exposures and interest rate swaps to hedge variable interest rate exposures. Derivatives, if entered into, are used exclusively for hedging purposes and not as trading or speculative instruments.

The Company's financial risk management policy is set by the Managing Director and governed by overall direction of Board of Directors of the Company. Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rate, foreign currency exchange rates, equity prices and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency receivables, payables and loans and borrowings.

54.1 Credit Risk

Credit risk arises from the possibility that the counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically assesses financial reliability of customers, taking into account the financial conditions, current economic trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.

a) Trade and other receivables

The Company's exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

The Company allocates each exposure to a credit risk grade based on a variety of data that is determined to be predictive of the risk of loss (e.g. timeliness of payments, available press information etc.) and applying experienced credit judgment. Exposures to customers outstanding at the end of each reporting period are reviewed by the Company to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macro economic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

b) Cash and Cash Equivalents

The Company held cash and cash equivalents of H 219.83 Lakhs at March 31, 2022 (March 31, 2021: H 31.87 Lakhs). This includes the cash and cash equivalents held with the bank and the cash on hand with the Company.

54.2 Liquidity Risk

Liquidity risk is the risk in terms of difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation.

The Company has obtained fund and non-fund based working capital loan from bank. The borrowed funds are generally applied for Company's own operational activities.

b) Interest Rate Risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair values of fixed interest bearing investments because of fluctuations in the interest rates. The company's exposure to the risk of changes in the market interest rate relates primarily to the company's long term debt obligations with floating interest rates. The company's interest rate exposure is mainly related to variable interest rates debt obligations. The Company manages the liquidity and fund requirements for its day to day operations like working capital, suppliers/buyers credit.

Exposure to interest rate risk

Company's interest rate risk arises from borrowings. Borrowings issued at fixed rates exposes to fair value interest rate risk. The interest rate profile of the Company's interest-bearing financial instruments as reported to the management of the Company is as follows.

Fair value sensitivity analysis for fixed-rate instruments

The Company does not account for any fixed-rate financial assets or financial liabilities at fair value through profit or loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss.

Cash flow sensitivity analysis for variable-rate instruments

The risk estimates provided assume a change of 25 basis points interest rate for the interest rate benchmark as applicable to the borrowings summarised above. This calculation assumes that the change occurs at the balance sheet date and has been calculated based on risk exposures outstanding as at that date assuming that all other variables, in particular foreign currency exchange rates, remain constant. The period end balances are not necessarily representative of the average debt outstanding during the period.

54.3 a) Market Risk

Market risk is the possibility of losses that may be incurred by the company due to factors that affect the overall performance of the company - such as foreign exchange rates, interest rates, recessions etc. Market risk is attributable to all market risk sensitive financial instruments including foreign currency receivables and payables and long term debt. We are exposed to market risk primarily due to the fluctuations in the rate of interest for borrowings from banks, recession in the market, foreign exchange rate fluctuation etc.

b) Currency Risk

The fluctuation in foreign currency exchange rates may have potential impact on the statement of profit or loss and other comprehensive income, where any transaction references more than one currency or where assets / liabilities are denominated in a currency other than the functional currency of the respective entities. Considering the countries and economic environment in which the Company operates, its operations are subject to risks arising from fluctuations in exchange rates in those countries. The risks primarily relate to fluctuations in US Dollar against the functional currencies of the Company. The Company, as per its risk management policy, uses natural hedge technique of adjusting foreign currency receivables against currency payables. The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks. Exposure to all other foreign currencies other than US Dollar is not material.

D) Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company's receivables from customers. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade and other receivables and investments.

For the purpose of the Company's capital management, capital includes issued capital and other equity reserves. The primary objective of the Company's Capital Management is to maximize shareholders value. The Company manages its capital structure and makes adjustments in the light of changes in economic environment and the requirements of the financial covenants.

56 The Code on Social Security 2020

The Code on Social Security 2020 (‘the Code') relating to employee benefits, during the employment and postemployment, has received Presidential assent on September 28, 2020. The Code has been published in the Gazette of India. Further, the Ministry of Labour and Employment has released draft rules for the Code on November 13, 2020. However, the effective date from which the changes are applicable is yet to be notified and rules for quantifying the financial impact are also not yet issued.

The Company will assess the impact of the Code and will give appropriate impact in the financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published."

57 Figures of the Previous year are regrouped / reclassified wherever considered necessary and rounded off to the nearest lakh.