16.1 Terms and rights attached to equity shares

Equity shares have a par value of Rs. 10. They entitle the holder to participate in dividends, and to share in the proceeds of winding up the Company in proportion to the number of and amounts paid on the shares held. Every holder of equity shares present at a meeting in person or by proxy is entitled to one vote, and upon a poll each share is entitled to one vote.

Capital Reserve

The Company created capital reserve on cancellation/ forfeiture of the Company's own equity instruments. Capital reserve was created in financial year 2008-09.

Capital Redemption Reserve

Capital Redemption Reserve is created out of profit available for distribution towards redemption of Preference shares. This reserve can be used for the purpose of issue of Bonus shares.

General Reserve

General Reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the General Reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the General Reserve will not be reclassified subsequently to statement of profit and loss.

Amalgamation Reserve

The amalgamation Reserve was created on amalgamation of Pix Auto Ltd with the Company in financial year 1999-2000.

Securities Premium

Securities Premium Reserve represents premium on issue of shares. The reserve will be utilised in accordance with the provisions of the Companies Act, 2013.

Retained earnings

The balance in the Retained Earnings primarily represents the surplus after payment of dividend and transfer to reserves.

30.1 Disclosure as per Indian Accounting Standard - 19 on 'Employee Benefits'Leave Obligations:

The leave obligations cover the Company's liability for earned leave which are classified as other longterm benefits.

Leave obligations expected to be settled within the next 12 months - Rs. 124.55 lakhs (31 March, 2021: Rs. 120.81 lakhs)

Leave obligations not expected to be settled within the next 12 months - Rs. 13.25 lakhs (31 March, 2021: Rs. 8.92 lakhs)

Post-employment obligations (Gratuity)

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The gratuity plan is unfunded.

Defined contribution plans:

The Company also has a certain defined contribution plan. Contributions are made to provident fund in India for employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognised during the period towards defined contribution plan is Rs. 239.76 lakhs (31 March 2021 - Rs. 224.55 lakhs).

"The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period."

Sensitivities due to mortality & withdrawals are not material & hence impact of change not calculated. Risk Exposure:

"Through its defined benefit plan, the Company is exposed to a number of risks, the most significant of which are detailed below:

1. Changes in bond yields: A decrease in bond yields will increase plan liabilities

2. Longevity risk: The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan's liability.

3. Salary growth risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. An increase in the salary of the plan participants will increase the plan's liability."

Post employment benefits have been provided at gross level on totality basis and not available at individual employee level.

Transactions relating to dividends were on the same terms and conditions that applied to other shareholders.

Goods were sold to subsidiaries (including step down subsidiaries) during the year based on the price lists in force and terms that would be available to third parties.

All other transactions were made on normal commercial terms and conditions and at market rates.

1. Nature of Goods and services

The revenue of the company comprises of income from Business of Industrial rubber products. The following is a description of principal activities:

Manufacturing of rubber V-belts & related mechanical transmissions products.

3. Information about major customers

The Company does not have any external customer other than its subsidiaries, with whom revenue from transactions is more than 10% of Company's total revenue (Refer Note 35).

The accounting classification of each category of financial instrument, their carrying amount and fair value are as follows :-Fair Valuation Techniques

The fair values of the financial assets and liabilities are included at the amount 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 following methods and assumptions were used to estimate the fair values:

- The fair value of mutual funds are based on price quotations at the reporting date.

- The Company has entered into derivative financial instrument with a counterparty, principally with bank. The derivative contract has been valued using valuation techniques, which employs the use of market observable inputs.

Fair Value Hierarchy

Fair Values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows

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.

Vehicle loans are secured against hypothecation of vehicles.

iii. Terms of repayment of Unsecured Loans

These Loans carries an interest rate of 9% to 11.50% (31 March, 2021: 10.50% to 13%) and is repayable in March 2024.

iv. Security and terms of repayment of working capital loans

(a) Working capital loans are secured by:

1) 1st pari passu charge by way of hypothecation of entire current assets of the Company including raw materials, finished goods, stock-in-process at the Company's factory premises or at such places as may be approved by the Bank from time to time including stocks-in-transit, book debts, receivables, on pari passu basis under multiple banking arrangement.

2) 2" pari passu charge on entire fixed assets (Moveable and Immovable) of the Company by way of Equitable Mortgage located at

i) Plot no J-7, MIDC Hingna Road, Nagpur - Unit NO.1

ii) K-36,K-37/38 at MIDC , Hingna Road, Nagpur- Unit NO.2

iii) Khasra No. 55 & 57, Nagalwadi, Tahsil Hingna. Dist. Nagpur Mixing Plant

iv) Khasra No.45, 46/2, 48,25, 46/1,47, Mauza, Nagalwadi.

(b) Working capital loans from banks are repayable on demand

(c) Working capital loans from banks carry an interest rate of 6.00% to 8.00% (31 March, 2021: 6.00% to 9.00%) (E) Financial Risk Management

The Company's activities are exposed to variety of financial risks. The key financial risks include market risk, credit risk and liquidity risk. The company's focus is to foresee the unpredictability of financial markets and seek

to minimise potential adverse effects on its financial performance. The Board of Directors reviews and approves policies for managing these risks. The risks are governed by appropriate policies and procedures and accordingly financial risks are identified, measured and managed in accordance with the company's policies and risk objectives.

(i) 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 Company is exposed to credit risk for trade receivables, cash and cash equivalents, investments, other bank balances, loans and other financial assets. The Company only deals with parties which have good credit rating/ worthiness given by external rating agencies or based on Company's internal assessment.

Credit risk on trade receivables and contract assets are managed by the Company's established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed and individual credit limits are defined in accordance with this assessment. Moreover, given the diverse nature of the Company's businesses, trade receivables and contract assets are spread over a number of customers. No single external customer (except for subsidiaries) accounted for 10% or more of the trade receivables in any of the years presented.

For trade receivables, as a practical expedient, the Company computes credit loss allowance based on a provision matrix. The provision matrix is prepared based on historically observed default rates over the expected life of trade receivables and is adjusted for forward-looking estimates.

For Mutual Fund Investments, counterparty risk are in place to limit the amount of credit exposure to any one counterparty. This, therefore, results in diversification of credit risk for Company's mutual fund investments.

The Credit risk on mutual fund investments, cash and cash equivalents, and other bank balances are limited as the counterparties are banks and fund houses with high-credit ratings assigned by credit rating agencies.

The carrying amount of maximum exposure to credit risk. The concentration of credit risk is limited due to the customer base being large and respective financial assets recognised in the financial statements, represents the Company's unrelated. Of the trade receivables balance at the end of the year, there are no customer accounting for more than 10% of the trade receivable as at March 31, 2022.

The Company establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other receivables. Receivables from customers are reviewed/evaluated periodically by the management of the company and appropriate provisions are made to the extent recovery there against has been considered to be remote.

(ii) 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 a reasonable price. The Company's objective is to maintain optimum level of liquidity to meet it's cash and collateral requirements at all times. The Company relies on borrowings and internal accruals to meet its fund requirement. The current committed line of credit are sufficient to meet its short to medium term fund requirement. The company manages liquidity risk by maintaining sufficient cash and marketable securities and by having access to funding through an adequate amount of committed credit lines.

(iii) Market Risk

Market risk is the risk or uncertainty arising from possible market fluctuations resulting in variation in the fair value of future cash flows of a financial instrument. The major components of Market risks are currency risk, interest rate risk and other price risk. Financial instruments affected by market risk includes trade receivables, borrowings, investments and trade and other payables.

(a) 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 rate. There is nominal amount of interest income but significant interest expenses are incurred by the company on borrowed funds. In order to minimize the interest cost, interest reset options is opted and a regular pursuance is made with financial institutions/commercial banks to lower down the interest rates as per prevailing market trend. The policies is designed to optimise the use of available funds for repayment of loans and other payment obligations so that funds are not remained idle with the company.

The Company's exposure in market risk relating to change in interest rate primarily arises from floating rate borrowing with banks. The Company maintains a portfolio mix of fixed and floating rate borrowings. During the current year, the Company has structured and swapped floating interest rate loan to fixed interest rate loan. Refer Note 38(C).

Further there are deposits with banks which are for short term period and are exposed to interest rate risk, falling due for renewal. These deposits are however generally for trade purposes as such do not cause material implication.

(b) 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 the Company's foreign currency borrowings, trade receivables and trade payables.

The Company has adopted a comprehensive risk management review system wherein actively engage in forward contracts its foreign exchange exposures within defined parameters through forward contracts. The Company periodically reviews its risk management initiatives and manages this forex risk using derivatives ,wherever required ,to mitigate or eliminate the risk.

The Company has not taken any forward contract during the current year and also there were no outstanding forward contract as on 31 March, 2022.

(c) Other price risk

The Company's equity exposure in Subsidiaries, are carried at cost or deemed cost and these are subject to impairment testing as per the policy followed in this respect.

The company's current investments which are fair valued through profit and loss and are not material. Accordingly, other price risk of the financial instrument to which the company is exposed is not expected to be material.

Capital management

The primary objective of the Company's capital management is to ensure that it maintains a healthy capital ratio in order to support its business and maximise shareholder value. The Company's objective when managing capital is to safeguard their ability to continue as a going concern so that they can continue to provide returns for shareholders and benefits for other stake holders. The Company is focused on keeping strong total equity base to ensure independence, security, as well as a high financial flexibility for potential future borrowings, if required.

Note 45.5 Details of benami property held

No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

Note 45.6 Borrowing secured against current assets

The Company has borrowings from banks and financial institutions on the basis of security of current assets. The quarterly returns or statements of current assets filed by the Company with banks and financial institutions are in agreement with the books of accounts.

Note 45.7 Wilful defaulter

The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

Note 45.8 Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

Note 45.9 Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013.

Note 45.10 Compliance with approved schemes of arrangements

The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.

Note 45.11 Utilisation of borrowed funds and share premium

The Company has not advanced or loaned or invested funds to any other persons or entities, including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

The Company has not received any fund from any persons or entities, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries

Note 45.12 Undisclosed income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

Note 45.13 Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

Note 45.14 Valuation of PP&E and intangible asset

The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

Note 45.15 Title deeds of Immovable Properties

Title deeds of all immovable properties are held in the name of the Company.

Note 45.16 Borrowings from Banks and financial institutions

The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken.

Note 45.17 Registration of charges / satisfaction with Registrar of Companies (ROC)

Charges / Satisfaction has been duly registered with ROC within the statutory period

Note 46

"Till previous year, the Company presented sales related discounts under other expenses instead of adjusting the same against the revenue from operations. In the current year, the Company has restated in accordance with Ind AS 8 - "Accounting policies, Changes in accounting estimates and Errors", restating its numbers for the preceding year ended on 31 March 2021 in this regard. The information below summarises the impact of the restatement:

Revenue from Operations as reported for the year ended 31 March 2021 with Rs. 37,323.34 lakhs; restated amount being Rs. 35,394.17 lakhs. Other expenses as reported for the year ended 31 March 2021 with Rs. 6,092.91 lakhs; restated amount being Rs. 4,158.58 lakhs.

Other line items of Balance Sheet and Statement of Profit and Loss that were not affected by the restatement have not been disclosed. Furthermore, there is no impact on the profit and retained earnings of the Company for the said year. Accordingly, opening balance sheet has not been presented."

The accompanying notes 1 to 46 are an integral part of these standalone financial statements