During the current year, the company has issued 1,21,63,479 Equity Shares of Rs. 10/- each as fully paid-up bonus shares representing a ratio of 3 (three) equity shares for every 1 (one) equity share outstanding on the record date, by capitalization of Capital Reserve, Security Premium, General Reserve and profit and loss account pursuant to a bonus issue approved by the Shareholders in the 32nd Annual General Meeting held on May 30, 2022. Accordingly, as required by IndAS-33 Earnings per Share, the EPS of current and previous years have been restated. There are no shares issued for consideration other than cash and no shares were bought back during the period of 5 years immediately preceding the reporting date.
The Company has one class of share capital, comprising ordinary shares of Rs. 10/- each. Subject to the Company's Articles of Association and applicable law, the Company's ordinary shares confer on the holder the right to receive notice of and vote at general meetings of the Company, the right to receive any surplus assets on a winding-up of the Company, and an entitlement to receive any dividend declared on ordinary shares.
Capital Redemption Reserve:
A Statutory reserve created to the extent of sum equal to the nominal value of the Share Capital extinguished on buyback of Company's own shares pursuant to Section 69 of the Companies Act, 2013.
Security Premium:
Securities Premium has been created consequent to issue of shares at premium.These reserves can be utilised in accordance with Section 52 of the Companies Act, 2013.
* a) Open Cash Credit from Canara Bank is secured by way of Primary security of hypothecation of Stocks, Book debts and Collateral Security of Plant & Machinery, other fixed assets of the company and Land and Buildings situtated at Plot No. 47, Survey No. !4i,APNC Industrial Park, Gambheeram (V),Visakapatnam and personal guarantee of the Managaing Director of the Company and the rate of interest @11.75% p.a.
b) The Carrying amount of Current and Non-current assets pledged as primary and collateral security for current borrowings are disclosed in Note No.48.
(b) Contract Assets
Company recognized contract assets when it satisfies its obligation by transferring the goods or services to the customer and right to receive the consideration is established which is subject to some conditions to be fulfilled by the company in future before receipt of consideration amount. Such assets are Rs Nil.
During the year company has recognized revenue of Rs. Nil(P.Y. Rs Nil) from the performance obligations satisfied in earlier periods.
The company has made the adjustment of Rs Nil (P.Y.Rs.Nil) in the revenue of Rs.15,426.73 Lakhs ( P.Y. Rs. 10,494.37 Lakhs) recognized during the year on account of discounts, rebates, refunds, credits, price concessions, incentives performance bonuses etc as against the contracted revenue of Rs.15,426.73 Lakhs ( P.Y. Rs. 10,494.37 Lakhs).
(c) Contract Liabilities
Upon execution of contract with the customers, certain amount in the form of EMD, Security Deposit, Margin Money, advance for payment of custom duty etc. received from the customers which is shown as advance received from customers under the heading ‘ ‘Other Financial Liabilities” and “Other Liabilities”. The balances are Rs Nil
(d) Practical expedients
During the year company has entered into sales contracts with its customers where contracts are not executed, same has not been disclosed as practical expedient as the duration of the contract is less than one year or right to receive the consideration established on completion of the performance by the company.
B. Significant judgements in the application of this standard
(i) Revenue is recognized by the company when the company satisfies a performance obligation by transferring a promised good or service to its customers. Asset/goods/services are considered to be transferred when the customer obtains
control of those asset/goods/services. ,—>
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(ii) The company considers the terms of the contract and its customary business practices to determine the transaction price. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, GST etc.).
(iii) The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. Any further adjustment will be made by raising debit/credit notes on the customer.While determining the transaction price effects of variable consideration, constraining estimates of variable consideration, the existence of a significant financing component in the contract, non-cash consideration and consideration payable to a customer is also considered.
C. Assets Recognised from costs to obtain or fulfill a contract with a customer
The costs incurred by the company are fixed in nature with no significant incremental cost to obtain or fulfill a contract with a customer and same is charged to profit and loss as a practical expedient.
a) Provident Fund: Company pays fixed contribution to provident fund at predetermined rates to the government authorities. The contribution of Rs. 35.02 Lakhs (Previous year Rs. 33.63 Lakhs) including administrative charges is recognized as expense and is charged in the Statement of Profit and Loss. The obligation of the Company is to make such fixed contribution and to ensure a minimum rate of return as specified by GOI to the members. The overall interest earnings and cumulative surplus is more than the statutory interest payment requirement during the year.
b) Leave Encashment: The company accumulates of compensated absences by certain categories of its employees for one year. These employees receive cash in lieu thereof as per the Company's policy. The company recognises expenditure on payment basis.
c) Gratuity: Gratuity is a funded Defined Benefit Plan payable to the qualifying employees on superannuation. It is managed by a 'Life Assurance Scheme' of the Life Insurance Corporation of India and the company makes contributions to the Life Insurance Corporation of India (LIC). Company makes annual contribution to the Fund based on the present value of the Defined Benefit obligation and the related current service costs which are measured on actuarial valuation carried out as on Balance Sheet date. The liability has been assessed using Projected Unit Credit (PUC) Actuarial Cost Method.
Fair Value Hierarchy Management considers that,the carrying amount of those financial assets and financial liabilies that are not subsequently measured at fair value in the Financial Statements approximate their transaction value. No financial instruments are recognized andmeasured at fair value for which fair values are determined using the judgments and estimates. The fair value of Financial Instruments referred below has been classified into three categories depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active market for identical assets or liabilies. (Level-1 measurements) and lowest priority to unobservable (Level-3 measurements).
The Company does not hold any equity investment and no financial instruments hence the disclosure are nil Financial Risk Management:
The Company's activities expose to a variety of financial risks viz.,market risk, credit risk and liquidity risk.The Company's focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.The primary market risk to the Company is credit risk and liquidity risk.The Company's exposure to credit risk is influenced mainly by Government Orders.
Management of Market Risk:
Market risks comprises of Price risk and Interest rate risk. The Company does not designate any fixed rate financial assets as fair value through Profit and Loss nor at fair value through OCI. Therefore, the Company is not exposed to any interest rate risk. Similarly, the Company does not have any Financial Instrument which is exposed to change in price.
Credit Risk:
Credit risk is the risk of financial loss to the Company if a customer fails to meet its contractual obligationsThe maximum exposure to the credit risk at the reporting date is primarily from trade receivables.The company operations are with Government and allied companies and hence no issues credit worthiness. The company considers that, all the financial assets that are not impaired and past due as on each reporting dates under review are considered credit worthy.
Credit risk exposure
An analysis of age-wise trade receivables at each reporting date is summarized as follows:
Liquidity Risk:
The company's liquidity needs are monitored on the basis of monthly projections. The principal sources of liquidity are cash and cash equivalents, cash generated from operations and availability of cash credit and overdraft facilities to meet the obligations as and when due. Short term liquidity requirements consist mainly of sundry creditors, expenses payable and employee dues during the normal course of business. The company maintains sufficient balance in cash and cash equivalents and working capital facilities to meet the short term liquidity requirements.
The company assesses long term liquidity requirements on a periodical basis and manages them through internal accruals and commited credit lines.
Note: 42. Capital Management
The objective of the company when managing capital are to
- to safegaurd the companys ability to continue as going concern, So that they can continue to provide returns for the Share holder and benefits for other stake holders.
- maintain optimal capital structure to reduce cost of capital
Note: 46.The disclosure relating to transactions with Micro, Small and Medium Enterprises
Sundry Creditors includes Rs. 264.62/- Lakhs (previous year Rs. NIL Lakhs) due to Small Scale & Ancillary undertakings. There are no Micro, Small and Medium Enterprises, to whom the Company owes dues, which are outstanding for more than 45 days at the Balance Sheet date. The above information has been determined to the extent such parties have been identified on the basis of information available with the Company.This has been relied upon by the auditors.
Note: 47. Corporate Social Responsibility (CSR)
As per Section 135 of the Companies Act, 2013, a company, meeting the appicability threshold, needs to spend at least 2% of its average net profit for the immediately preceeding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, healthcare, women empowerment, measures for the benefit of war widows and contributions to incubators has been formed by the company as per the Act. The funds were primarily allocated to a corpus and utilised through the year on these activities which are specified in scheduleVII of the Companies Act, 2013.
The amount of expenditure to be spent on CSR activities and financial details as per the Companies Act, 2013 for the F.Y 2022-23 & 2021-22 are as under:
The Company has considered the possible effects that may result from the pandemic relating to Covid-19 in the preparation of these standalone financial statements including the recoverability of carrying amounts of financial and non-financial assets. In developing the assumptions relating to the possible future uncertainties in the global economic conditions because of this pandemic, the Company has, at the date of approval of these financial statements, used internal and external sources of information including credit reports and related information and economic forecasts and expects that the carrying amount of these assets will be recovered. The impact of Covid-19 on the Company's financial statements may differ from that estimated as at the date of approval of these standalone financial statements.
The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry.The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published.
Note: 52. Confirmations
The Company requested its debtors and creditors to confirm the balances as at the end of half year in respect of trade payables, trade receivables and advances directly to the Statutory Auditors.
Note: 53
Previous year's figures have been regrouped/reclassified/recasted wherever necessary to confirm to the current year's presentation.
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