The recoverable amount of the CGU is determined based on a value in use calculation which uses cash flow projections covering a five-year period and a discount rate 11.00% per annum (31-03-2022 : 11.87% per annum). Cash flow projections during the five year period are based on the histrorical growth rate and margins. The cash flows beyond that five-year period have been extrapolated using a steady 5% per annum (31-03-2022 : 5% per annum) growth rate which is the projected longterm average growth rate.

The Management believes that any reasonably possible change in the key assumptions on which recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the cash-generating unit.

There are no shareholders holding more than 5% of the aggregate equity shares of the Company except above.

There are no change in promoters shareholding

16c The Company has not allotted any equity shares for consideration other than cash and bonus shares during the period of five financial years immediately preceding the Balance Sheet date.

16d Shares bought back (during 5 financial years immediately preceding March 31, 2023)

No Equity Shares bought back during 5 financial years immediately preceding March 31, 2023.

16 e Rights, preferences and restrictions attached to shares

The Company has one class of equity share having a par value of ' 10/- per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing annual general meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining asset of the Company after distribution of all preferential amounts, in proportion to their shareholding.

The Company has recorded tax expense ' 892 Lakhs and interest thereon ' 630 aggregating to ' 1,522 Lakhs in respect of AY 2012-13 against the final assessment order dated November 22, 2022 consequent to “’’Mutual Agreement Procedure (MAP)”” resolution agreed between Indian and Singapore competent authorities in accordance with rule 44G(6) of the Income Tax Rules, 1962. This case is primarily related to transfer pricing adjustment arising from international transactions with Associated Enterprise “Clariant (Singapore) Pte Limited”. The Company had deposited ' 1,832 Lakhss under protest with Income Tax Authorities in earlier years. The tax expenses and interest thereon have been disclosed under “” Tax expense of prior years “” and Exceptional item”” respectively for the year ended March 31, 2023.

33 FINANCIAL INSTRUMENTS AND RISK REVIEW

Capital management

The Company's objectives when managing capital are to :

(i) Safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders; and

(ii) Maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.

The capital structure of the Company consists of equity of the Company (comprising issued capital, reserves and retained earnings as detailed in notes 16 and 17). The Company is a zero debt Company with no long-term borrowings as at 31-03-2023. The Company is not subject to any externally imposed capital requirements.

At the end of the reporting period, there are no significant concentrations of credit risk for financial assets measured at FVTPL. The carrying amount reflected above represents the Company's maximum exposure to credit risk for such Financial assets.

Financial risk management framework

The Company is primarily exposed to financial risks, market risk (including foreign exchange risk and price risk), credit risk and liquidity risk. The Company's overall risk management program focuses on the unpredictability of financial markets and addresses the risk associated with the financial asset and liabilities.

Management identifies, evaluates and hedges financial risks under approved policies to manage overall foreign exchange risk, credit risk and investing surplus liquidity (counterparty risk).

Market risksForeign exchange risk

The Company has exports to and imports from other countries and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the Euro and the US-dollar. Foreign exchange risk arise from recognized assets and liabilities, when they are denominated in a currency other than Indian Rupee.

The exchange rates have been volatile in the recent years and may continue to be volatile in the future. The Company mitigates the foreign exchange risk by setting appropriate exposure limits, periodic monitoring of the exposures etc.

Credit risk

Credit risk arises from entering into derivative financial instruments, from deposits with banks and financial institutions, as well as from credit exposures to customers, including outstanding receivables.

Customer credit risk exposure is triggered by customer default risk and country risk. As at balance sheet date, the Company does not have significant concentration of credit risk either due to size of customers or due to country risk. Company has a credit risk policy in place to ensure that sales are made to customers only after an appropriate credit risk rating and credit line allocation process. Procedures are standardised within credit risk policy and supported by the IT system with respective credit management tools. The Company has adopted a policy of only dealing with creditworthy counterparties and obtaining collaterals viz Security Deposit or bank Guarantee as per Credit Policy, as a means of mitigating the risk of financial loss from defaults.The average credit period on sales of goods is 60 to 90 days.

The credit risk on Cash & cash equivalents and derivative financial instruments is limited because the counterparties are banks with high credit-ratings assigned by credit-rating agencies. Also, the credit risk on security deposits for rental premises and loans to employees have low credit risk because of no history of defaults and no concerns for the counterparties to meet their obligations in the future.

Liquidity risk

Liquidity risk management:

The Company is currently debt free having no long term financial liabilities. Management monitors the forecasts of the Company's liquidity requirements to ensure it has sufficient cash to meet its operational needs while maintaining sufficient headroom on its undrawn borrowing facilities. Considering the liquidity advantage funds surplus to the operational needs are invested in the short term bank deposits . The cash & cash equivalents and bank deposits are highly liquid and are readily available for payment of liabilities.

The following table analysis the maturity profile of the Company's financial liabilities. The amounts disclosed are the contractual undiscounted cash flows. The contractual maturity is based on the earliest date on which the Company may be required to pay.

* The Company has received a demand notice of ' 92.41 Lakhs, ' 306.07 Lakhs and ' 923.70 Lakhs including interest of ' 3.55 Lakhs, ' 11.77 Lakhs and ' 34.90 Lakhs respectively against alleged short deduction of TDS on the dividend payments made to then parent companies during the quarter ended December 31, 2021, September 30, 2021 and year ended March 31, 2021 respectively.

The Company is confident that, on the basis of its technical evaluation and indemnification letter received from erstwhile promoter shareholders', there will be no liability that will devolve on the Company and accordingly no provision has been made in books of accounts in respect of this demand.

34 FAIR VALUE MEASUREMENT AND RELATED DISCLOSURESFair value of the Company's financial assets that are measured at fair value on a recurring basis:

Some of the Company's financial assets are measured at fair value at the end of each reporting period.

The following table gives information about how the fair values of these financial assets are determined (in particular, the valuation technique(s) and inputs used).

The Board, at their meeting held on April 22, 2022, based on recommendation of the Nomination & Remuneration Committee and subject to approval of shareholders through Postal Ballot, appointed Mr. Bharath R. Sesha as the Managing Director; Mr. Ravi Kapoor as a Non-Executive Director, acting as the Chairman of the Company; and Mr. Abhijit Naik as the Whole Time Director of the Company, effective from April 23, 2022. Moreover, consequent to acquisition of the Company (refer note 49) by S K Capital and Heubach Group, Mr. Alfred Muench, Mr. Thomas

Wenger and Mr. Sanjay Ghadge, Non-Executive Directors of the Company, being Clariant's representatives, have resigned from Directorship of the Company effective form April 23, 2022.

The Board, at their meeting held on February 03, 2023, based on recommendation of the Nomination & Remuneration Committee, approved the appointment of Mr. Jugal Sahu, Chief Financial Officer of the Company as Executive Director and Chief Financial Officer for a period of 3 years from February 03, 2023 to February 02, 2026, which was approved by the shareholders by way of a Special Resolution through Postal Ballot on March 24, 2023. Moreover, Mr.Abhijit Naik has resigned from the post of Whole-time Director due to change in work profile within the organisation w.e.f. February 03, 2023.

41 SEGMENT iNFORMATiON :

(a) Information reported to the Chief operating decision maker (CODM) for the purposes of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided. No operating segments have been aggregated in arriving at the reportable segments of the Company.

The Company's reportable segments under Ind AS 108 are as follows:

(i) Plastics & Coatings :

Includes pigments, pigment preparations, additives and masterbatches.

(ii) Specialty Chemicals :

Includes dyestuff, synthetic resins, functional effects and coating, auxiliaries and chemicals.

(b) The following is an analysis of the Company's revenue and results from operations by reportable segment and reconciliation of segment revenue and Segment profit with total revenue and profit before tax respectively:

(c) Segment revenue reported above represents revenue generated from external customers. There were no inter -segment sales.

(d) The accounting policies of the reportable segments are the same as the Company's accounting policies described in note 1. Segment results represents the profit before tax earned by each reportable segment without allocation of central administration costs, other income, finance costs as well as exceptional items. This is the measure reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance.

(f) For the purposes of monitoring segment performance and allocating resources between segments:

All assets are allocated to reportable segments other than investments, loans, certain financial assets and current and deferred tax assets. Goodwill is allocated to reportable segments; and

All liabilities are allocated to reportable segments other than borrowings, other financial liabilities, current and deferred tax liabilities.

42 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 stake holders 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.

44 OTHER STATUTORY INFORMATION

i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

ii) There are no assets hypothecated against the bank limits sanctioned. The bank limits are unsecured. Hence, the Company is not obliged to send quarterly returns or statement of current assets.

iii) The Company has not been declared a wilful defaulter as defined by RBI Circular.

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

v) Since, the Company does not have any subsidiary, the provisions of Section 2(87) of the Companies Act, 2013, read with the Companies (Restriction on number of Layers) Rules, 2017, are not applicable;

vi) The Company has not entered into scheme of arrangement during the financial year 2022-23

vii) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

viii) (i) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), 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

ix) (ii) The Company has not received any fund from any person(s) or entity(ies), 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 to or on behalf of the Ultimate Beneficiaries.

x) During the year, the Company has not surrendered or disclosed any income in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961). Accordingly,there are no transaction which are not recorded in the books of accounts.

45 The Company do not have transactions with Struck off Companies under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.

47 The Clariant Group, globally, announced on January 03, 2022 that it has completed the sale of its Pigments business to a consortium of Heubach Group (''Heubach”) and SK Capital Partners (“SK Capital”) (hereinafter referred to as “the acquirers”).

Consequent to the said acquisition and pursuant to the share purchase deal between Clariant and acquirers, the management and control of the Company has been indirectly divested with the acquirers. Due to the said indirect acquisition, an Open Offer was floated by Luxembourg Investment Company 428 S.a r.l. (“Acquirer”), together with Luxembourg Investment Company 426 S.a r.l. (“PAC 1”), Clariant AG (“PAC 2”), Heubach Holding GmbH (“PAC 3”), Ravi Kapoor (“PAC 4”), Heubach Verwaltungs GmbH (“PAC 5”) and Colorants International AG (“PAC 6” and, along with PAC 1, PAC 2, PAC 3, PAC 4 and PAC 5, the “PACs”), in their capacity as persons acting in concert with the Acquirer in compliance with Regulations 3(1), 4 and 5(1) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended (the “SEBI SAST Regulations”) (“Open Offer” or the “Offer”). Pursuant to the Open Offer, Colorants International AG, one of the promoters, has acquired 7,76,761 equity shares, representing 3.36% of the voting share capital of the Company on March 16, 2022. Upon closure of the Open Offer, the promoters are holding 1,25,48,811 Equity Shares, representing 54.37% of the total issued share capital of the Company.

48 The figures for the previous year have been regrouped/recasted wherever necessary, to conform to the current year's classification.