1 BACKGROUND:

Wintac Limited ("the Company") was incorporated on the August 23, 1990.The Company carries on the business of development and manufacturing of sterile pharmaceuticals formulations. The Company's shares are listed at Bombay Stock Exchange. The financial statements of the Company is approved by the Board of Directors on May 23 , 2018.

(a) Land:

i) There is a dispute on title of the land at Sarjapur Road, Original Cost Rs.6,71,438. There has been a claimant to the said land who was successful in transferring the Khata to this name and the Company has filed a Writ Petition in the Honerable High Court of Karnataka which is pending disposal.

ii) The Company has received a Notice from the Office of the Special Land Acquisition Officer, National Highway Authority of India, Bangalore for the acquisition of455 Sq.Mtrs of Land atSy.No.54/1 (Front portion near the entry gate of the Factory Premises) for the purpose of expansion/widening of the National Highway No.48 at a proposed compensation of Rs.86.54 lakhs.

iii) In respect of factory land at Boodihal Village, two suits have been filed disputing the sale to the Company of 6.5 Acres of land original cost ^19,46,174/-, effected in the year 1995-96. The Company does not expect any adverse impact from the above two suits.

iv) Portion of vacant factory land at Boodihal Village, Nelamangala Taluk measuring 82,000 Sqft has been given on lease to Bangalore Pharmaceuticals & Research Laboratories Pvt. Ltd., a related party as per Section 2(76) of the Companies Act, 2013.

(b) Vehicle gross block includes motor car original cost of Rs.13,28,372/~ standing in the name of the Director.

(a) The Assessment of deferred tax asset is provisional and is subject to adjustments on Company filig its income tax return, assessment of returned income, outcome of appeals, etc.

(b) In light of the Company since retaining the regulatory approval for sales to US markets, regulatory approvals available for export to European markets and the current valuation of the Company, the Management is virtually certain that the Company will be able to earn taxable income in subsequent years to absorb deferred tax asset comprising carry forward depreciation.

(a) Statement of Account and confirmation of balance have not been received in respect of two accounts with book balance of Rs.34,919/- (Rs.34,381/-) which is non-operative and subject to reconciliation and confirmation.

Terms/ rights attached to equity shares

i) The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees.

In event of liquidation of the Company, the holders of equity shares would be entitled to receive 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 shareholders.\

Additional Information:

(a) Details of security:

i) Loan from a bank is secured against hypothecation of Plant and Machinery of the Company

ii) Vehicle loan from a company is secured against vehicles purchased.

(b) Term of Repayment:

i) Loan from a bank is repaid over a period of 92 months after 4 months moratorium -Rs.10 Lakhs per month for 72 months and Rs.14 Lakhs for 20 months.

ii) Vehicle Loan is repayable in 59 equated monthly installments of Rs. 78,158/- per month

(c) Rate of Interest:

i) Loan from bank carries a interest of 11.75% p.a. in the first year, 16.50% p.a. in the second year and 10.20% p.a. from third year onwards.

ii) Vehicle loan from a company carries interest rate of 8.90% p.a.

(d) There are no defaults/continuing defaults in repayment of principal amount of the loan or interest as on the balance sheet date.

(e) Loan from bank is guaranteed by Mr. S Jayaprakash Mady, Director of the Company.

(a) Amounts due to be credited to the Investor Education and Protection Fund as on 31-03-2018 Rs. Nil (Nil)

(b) Towards reimbursement of cost of materials, equipment and services procured through these parties against production of bills of original vender/ service provider.

(c) Others include employee dues and accrued liabilities.

(a) Sales includes Rs.41,73,983/- (Previous Year Rs.3,37,67,862/-)unbilled revenue from manufacture of goods against an export order from the one of the related party enterprises of holding company awaiting instructions for shipment.

2 EARNINGS PER SHARE

Basic Earnings per share (EPS) amounts are calculated by dividing the profit for the year attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders 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.

3 DEFINED BENEFIT PLAN - GRATUITY

The Company operates defined gratuity plan for its employees. Under the plan, every employee who has completed atleast five years of service gets a gratuity on departure at 15 days of last drawn salary for each completed year of service.

The scheme is funded with an insurance company in the form of qualifying insurance policy.

The following tables summarise the components of net benefit expenses recognised in the statement of profit and loss and the funded status and amount recognised in the balance sheet.

4 SHARE BASED PAYMENT:

During the year, the shareholders of the Company at the Annual General Meeting held on August 10, 2017 have approved an Employee Stock Option Scheme.However, the Company has not issued any options as at March 31, 2018 and accordingly, recognition of expense in this respect and requisite disclosures are not applicable.

5 SEGMENT REPORTING:

i) Managing Director of the Company has been identified as the Chief Operating Decision Maker ("CODM") as defined in Ind As 108, Operating Segments. The Company is engaged in the business of manufacturing of goods and all its other activities revolve around this business. The CODM reviews the performance of the Company as one entity. Accordingly, the Company has not identified any different segments. The Company has earned Rs.44,79,70,156 (Previous year Rs.34,89,81,131)from the business of development and manufacturing of pharmaceuticals formulations.

ii) The Company operates only in India, hence no geographical segments has been disclosed.

iii) The Company earns its 83.97% (Previous Year 70.66% from two customers) of revenue from operations has been earned from single customer.

6 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES:

The entity's principal financial liabilities comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the entity's operations to support its operations. The entity's principal financial assets include investments, trade and other receivables, and cash and cash equivalents that derive directly from its operations.

The entity is exposed to market risk and credit risk. The entity's senior management oversees the management of these risks. The entity's senior management is supported by a financial risk committee that advises on financial risks and the appropriate financial risk governance framework for the entity. The financial risk committee provides assurance to the entity's senior management that the entity's financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the entity's policies and risk objectives. All derivative activities for risk management purposes are carried out by specialist teams that have the appropriate skills, experience and supervision. It is the entity's policy that no trading in derivatives for speculative purposes may be undertaken. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below."

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk and other price risk, such as equity price risk, currency risk and commodity risk. Financial instruments affected by market risk include loans and borrowings. The sensitivity analyses in the following sections relate to the position as at 31 March 2018 and 31 March 2017. The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies. The analyses exclude the impact of movement in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions; and the non-financial assets and liabilities.

The assumption made in calculating the sensitivity analyses relate to the sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31 March 2018 and 31 March 2017.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in Interest rate. The entity's exposure to the risk of changes in Interest rates relates primarily to the entity's operating activities (when receivables or payables are subject to different interest rates) and the entity's net receivables or payables.

Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The entity is exposed to credit risk from its operating activities (primarily trade receivables).

Sales includes Rs.44,35,230/- (Rs. 3,37,67,862/-) unbilled revenue from manufacture of goods against an export order awaiting instruction for shipment and is reduced from advances received.

* Purchase of goods/equipments and services is by way of reimbursement of cost of goods and services procured on behalf of the Company against production of bill of the original vendor/ service providers.

7 FIRST TIME ADOPTION OF IND AS:

These financial statements, for the year ended 31 March 2018, are the first the Company has prepared in accordance with Ind AS. For periods up to and including the year ended 31 March 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ending on 31 March 2018, together with the comparative period data as at and for the year ended 31 March 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Company's opening balance sheet was prepared as at 1 April 2016, the Company's date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at 1 April 2016 and the financial statements as at and for the year ended 31 March 2017.

i. Exemptions availed:

(a) Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets and investment property covered by Ind AS 40 Investment Properties.

Accordingly, the Company has elected to measure all of its property, plant and equipment, intangible assets and investment property at their previous GAAP carrying value.

(b) Ind AS 27 requires investments in subsidiaries to be recorded at cost or in accordance with Ind AS 109 in its separate financial statements. However, Ind AS 101 provides an option to measure that investment at one of the following amounts in case the Company decides to measure such investment at cost:

i. Cost as per Ind AS 27 or

ii. Deemed cost, which is:

a. fair value at the entity's date of transition to Ind AS

b. previous GAAP carrying amount at that date

The Company has elected to measure its investments in subsidiaries using deemed cost at the previous GAAP carrying amount at the date of transition to Ind AS.

(c) Ind AS 101 provides an option to not apply Ind AS 102 to liabilities arising from share-based payment transactions that were settled before the date of transition to Ind AS. The Company has elected to avail this exemption and apply the requirements of Ind AS 102 to all such grants under the ESOP plan, which are not settled as at the date of transition to Ind AS.

ii. Exceptions applied:

(a) Ind AS 101 requires an entity's estimates in accordance with Ind ASs at the date of transition to Ind AS to be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

The Company's estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

Impairment of financial assets based on expected credit loss model.

(b) Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. The Company has applied the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

8. FIRST TIME ADOPTION OF IND AS:

Reconciliation of equity as at April 1, 2016 (date of transition to Ind AS)

Notes:

1 Excise duty on sales has been shown separately

2 In the previous year the Company had reported unclaimed credit balances as Exceptional item which has now regrouped to other Income and trade receivables and advances written off to other expenses

3 Processing fees and fair valuation of interest free deposit has been accounted based on effective interest rate method and accordingly adjusted under finance cost and corresponding adjustment of deferred tax.

9 FIRST TIME ADOPTION OF IND AS:

Notes: 1 Security Deposit

"Interest free lease deposits is measured at amortised costs using Effective Interest method. The difference between actual amount of lease deposit and fair value of lease is adjusted against the surplus i.e. statement of profit & loss and same is taken to revenue/ expenditure over the tenure of the lease. On the date of transition the Company has recognised net interest expense of Rs.4,83,720 and deferred tax of Rs.1,49,470/-"

2 Processing Fees

"Interest free lease deposits is measured at amortised costs using Effective Interest method The difference between actual interest expense as per fair valuation is adjusted against the outstanding balance of loan and same is adjusted to interest expenses over the tenure of the loan. On the date of transition the Company has recognised net interest expense of Rs.6,13,604 and deferred tax of Rs.1,89,604/-"

3 Defined Benefit Obligations

Under Ind AS, actuarial gains or losses, return on plan assets/liabilities (excluding interest on net asset/liability) and any change in effect of asset/liabilities ceiling is to be recognised in other comprehensive income. Thus the employee benefit cost is reduced by Rs.7,79,044/- for the FY 16-17 and remeasurement gains/ losses on defined benefit plans has been recognized in the OCI net of tax.

4 Deferred Tax

Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP.

In addition, the various transitional adjustments lead to temporary differences. According to the accounting policies, the Company has to account for such differences. Deferred tax adjustments are recognised in correlation to the underlying transaction either in retained earnings or a separate component of equity.

5 Provisions:

The Company was accounting leave encashment on actual basis instead of acturial basis. The Company has got valued as per Ind AS - 19 and provided an amount of Rs.37,22,931 for the financial year 2016 - 17.

6 Cash flow Statements:

The transition from Indian GAAP to Ind AS has not had a material impact on the statement of cash flows.

10 Recent Accounting Pronouncements:

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. 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. In addition, limited amendments have been made to some other Ind AS standards (Ind AS's 2, 12, 21, 28 and 40).

The Company is in the process of assessing the impact of the introduction of Ind AS 115-Revenue from Contracts with Customers and the limited amendments to the other Ind AS Standards. The impact, if any, will be disclosed in the financial statements for the quarter ended June 30, 2018.

11 The Income Tax Act, 1961 contains provisions for determination of arm's length price for international transactions between the Company and its associated enterprises. The regulations envisage taxation of transactions which are not in consonance with the arms length price so determined, maintenance of prescribed documents and information including furnishing of a report from an accountant before the due date for filing the return of income. For the year ended March 31, 2018, the Company is in the process of complying with the said regulations. Management believes that such transactions have been concluded on an arm's length basis and there would be no additional tax liability for the financial year under consideration as a result of such transactions.

12 In view of the advances/ support received from the major customers, the management doesn't expect any constraints in cash flow which might affect companies ability to meet its liabilities. Accordingly, despite of the Company's net worth has substantially eroded, the management doesn't find any material uncertainty which may cast significant doubt on the Company's ability to continue as going concern.

13 Events occurring after balance sheet date:

i) The Board of Directors of the Company have received a proposal from the Promoters i.e, Veego Pharma LLC, for voluntary delisting of equity shares of the Company from BSE Limited in accordance with the SEBI (Delisting of equity shares) Regulations, 2009. The Board has taken on record of the same at their meeting held on 26.04.2018 and has appointed Arihant Capital Markets Ltd., as merchant bankers for carrying out the due diligence as required in terms of Regulations 8(1)(A)(ii) of SEBI Delisting Regulations.

ii) The Board of Directors at their meeting held on 26.04.2018, have approved the proposal to effect slump sale of the pharmaceutical business undertaking of the Company to PAR formulations Pvt. Ltd., Chennai subject to all required approvals, specially shareholders approval and also subject to successful delisting equity shares of the Company from stock exchange and as per terms and conditions of the Business Transfer Agreement.

14 Previous year figures have been regrouped wherever necessary to conform with current year presentation.