Notes to financial statements for the year ended 31st March, 2018
The financial instruments are categorised into two levels based on the inputs used to arrive at fair value measurements as described below:
i) Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.
ii) Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) is determined using the valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specifc estimates. If all significant inputs required to fair value an instrument are obserable, the instrument is included in level 2.
iii) Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.
The Company's policy is to recongise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
41.1 Financial risk management
The Group has exposure to the following risks arising from financial instruments: credit risk liquidity risk market risk interest rate risk
Risk management framework
The Company has a risk management policy which covers risks associated with the financial assets and liabilities. The risk management policy is approved by the Board of Directors. The focus of the risk management committee is to assess the unpredictability of the financial environmnet and to mitigate potential adverse effects on the financial performance of the company.
A 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, loans and investment in debt securities. The Company establishes an allowance for doubtful trade receivables and impairment that represents its estimate of incurred losses in respect of trade and other receivables and investments.
The maximum exposure to credit risk in case of all the financial instuments covered below is restricted to their respective carrying amount.
The Company's exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer and including the default risk of the industry, 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 measures the expected credit loss of trade receivables based on historical trend, industry practices and the business environment in which the entity operates. Loss rates are based on actual credit loss experience and past trends.
Notes to financial statements for the year ended 31st March, 2018 Ageing of Trade receivables
in Lakhs
Particulars
|
As at 31 March 2019
|
As at 31 March 2018
|
Not due
|
2,821.33
|
2,087.19
|
0-3 months
|
418.34
|
480.25
|
3-6 months
|
30.39
|
33.45
|
6 months to 12 months
|
29.43
|
18.60
|
beyond 12 months
|
11.41
|
1.53
|
Allowance for doubtful trade receivables (Expected credit loss allowance)
|
8.01
|
9.91
|
Total
|
3,302.90
|
2,611.11
|
Financial Assets are considered to be of good quality and there is no significant increase in credit risk. Movement in provisions of doubtful debts
Loans
In the case of loans to employees, the same is managed by establishing limits. (Which in turn based on the employees salaries and number of years of service put in by the concern employee).
Investment in debt securities
The Company makes Investments in Deposits or Commercial papers or similar instruments in Companies having AA, AA or higher ratings from Credit rating agencies. The Company also makes investments in Debt Mutual funds.
The Company limits its exposure to credit risk by generally investing in liquid securities and only with counterparties that have a good credit rating. The Company does not expect any losses from non-performance by these counter-parties, and does not have any significant concentration of exposures to specific industry sectors or specific country risks.
Other than trade and other receivables, the Company has no other financial assets that are past due but not impaired. Cash and cash equivalents
The Company held cash and cash equivalents of Rs 2718.79 as at 31st March, 2019 (31st March, 2018: Rs 1429.30). The cash and cash equivalents are held with banks.
Derivatives
The derivative contracts are entered into with scheduled banks and financial institutions which have good credit ratings.
Particulars
|
As at 31 March 2019
|
As at 31 March 2018
|
Opening provision
|
9.91
|
16.36
|
Add: Additional provision made
|
(1.90)
|
(6.45)
|
Closing provision
|
8.01
|
9.91
|
Notes to financial statements for the year ended 31st March, 2019
B Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the Company's short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by monitoring forecast and actual cash flows, maintaining adequate reserves and by matching the maturity profiles of financial assets and liabilities.
The tables below provide details regarding the contractual maturities of significant financial liabilities as at:
|
As at 31st March 2019
|
|
As at 31st March 2018
|
Particulars
|
Carrying a mount-Contractual cash flows
|
Carrying amount-Contractual cash flows
|
|
Up to lyear
|
More than lyear
|
Up to lyear
|
More than 1 year
|
Non-derivative financial liabilities
|
|
|
|
|
Trade and other payables
|
2,158.75
|
-
|
2,870.54
|
-
|
Other financial liabilities
|
785.65
|
-
|
612.07
|
-
|
Total non-derivative financial liabilities
|
2,944.41
|
-
|
3,482.61
|
-
|
C Market risk
Market risk is the risk that the fair value or future cash flows of the financial instrument will fluctuate because of changes in market prices . Such changes in values of financial instruments may result from changes in foreign currency exchange rates, credit, liquidity and other market changes. The Company's exposure to market risk is primarily on account of foreign currency exchange rate risk.
(a) Foreign Currency Exchange Rate Risk
The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are managed utilising forward foreign exchange contracts.
The following table analyzes foreign currency risk from financial instruments as of 31st March 2019 and 31st March 2018 :
Exposure to liquidity risk
Particulars
|
USD
|
EURO
|
GBP
|
SGD
|
CAD
|
AUD
|
Accounts Receivable
|
|
|
|
|
|
|
As at :
|
|
|
|
|
|
|
31 March 2019
|
10.37
|
0.00
|
0.07
|
0.13
|
0.05
|
0.00
|
31 March 2018
|
10.62
|
0.00
|
0.14
|
-
|
0.01
|
0.01
|
Accounts Payable
|
|
|
|
|
|
|
As at :
|
|
|
|
|
|
|
31 March 2019
|
7.68
|
-
|
-
|
-
|
-
|
-
|
31 March 2018
|
13.21
|
-
|
-
|
-
|
-
|
-
|
Notes to financial statements for the year ended 31st March, 2019
Foreign currency sensitivity analysis
The Company is mainly exposed to the currency : USD and GBP
The following table details the Company's sensitivity to a 5% increase and decrease in the Rupee against the relevant foreign currencies. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% charge in foreign currency rate. A positive number below indicates an increase in the profit or equity where the Rupee strengthens 5% against the relevant currency. For a 5% weakening of the Rupee against the relevant currency, there would be a comparable impact on the profit or equity, and the balances below would be negative.
GBP impact
Particulars
|
As at 31 March 2019
|
As at 31 March 2018
|
Increase in exchange rate by 5%
|
6.29
|
3.54
|
Decrease in exchange rate by 5%
|
(6.29)
|
(3.54)
|
Forward foreign exchange contracts
The Company has entered into Forward Exchange Contracts, being derivative instruments for hedge purposes and not intended for trading or speculation purposes, to establish the amount of currency in Indian Rupees required or available at the settlement date of certain receivables.
The following are the outstanding Forward Exchange Contracts entered into by the Company.
Outstanding contracts
|
As at
|
Foreign currency
|
Carrying amount
|
Derivative instruments
|
|
|
|
Accounts Receivables (USD)
|
31 March 2019
|
1.00
|
68.58
|
|
31 March 2018
|
32.00
|
2,064.32
|
Accounts Payables(USD)
|
31 March 2019
|
-
|
-
|
|
31 March 2018
|
1.24
|
80.92
|
Impact on profit or loss and total equity
Rs in lakhs
Particulars
|
USD impact
|
As at 31 March 2019
|
As at 31 March 2018
|
Increase in exchange rate by 5%
|
250.11
|
194.12
|
Decrease in exchange rate by 5%
|
(250.11)
|
(194.12)
|
Particulars
|
Average Exchange rate
|
USD
|
GBP
|
INR/USD
|
INR/GBP
|
Export Transactions
|
|
|
|
|
As at :
|
|
|
|
|
31 March 2019
|
135.03
|
1.48
|
69.59
|
86.89
|
31 March 2018
|
118.43
|
0.82
|
64.40
|
86.22
|
Import Transactions
|
|
|
|
|
As at :
|
|
|
|
|
31 March 2019
|
61.48
|
0.04
|
71.47
|
77.93
|
31 March 2018
|
55.99
|
-
|
66.88
|
-
|
D 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, in cases where the borrowings are measured at fair value through profit or loss. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments will fluctuate because of fluctuations in the interest rates.
The Company's investments are primarily in fixed rate interest bearing investments. Hence , the Company is not significantly exposed to interest rate risk. The Company makes Investments in Deposits or Commercial papers or similar instruments in Companies having AA, AA or higher ratings from Credit rating agencies. The Company also makes investments in Debt Mutual funds.
Exposure to interest rate risk
The interest rate profile of the Company's interest-bearing financial instruments as reported to the management of the Company
Rs in Lakhs |
March 31, 2019
|
March 31, 2018
|
Fixed-rate instruments
|
|
|
Financial Assets - measured at amortised cost
|
0.00
|
0.00
|
Investment in Bonds
|
0.00
|
15.40
|
Total
|
0.00
|
15.40
|
Segmentwise Revenue, Results and Capital Employed for the year ended 31st March 2019
SI. NO.
|
Particulars
|
Year ended 31-03-2019
|
Year ended 31-03-2018
|
1
|
SEGMENT REVENUE
|
|
|
a
|
Laundry & Allied Products
|
26,751.50
|
25,186.11
|
b
|
IT Enabled Services
|
3,884.63
|
3,023.95
|
c
|
Windmill
|
339.13
|
320.33
|
|
TOTAL
|
30,975.26
|
28,530.39
|
|
Less : Inter segment Revenue
|
(290.12)
|
(277.40)
|
|
SALES/INCOME FROM OPERATIONS
|
30,685.14
|
28,252.99
|
2
|
SEGMENT RESULTS
|
|
|
a
|
Laundry & Allied Products
|
6,033.03
|
5,140.49
|
b
|
IT Enabled Services
|
641.52
|
606.67
|
c
|
Windmill
|
185.99
|
206.99
|
|
TOTAL
|
6,860.54
|
5,954.15
|
|
Less: Interest and Finance Charges
|
(10.99)
|
(62.45)
|
|
Less: Unallocated Expenditure (Net-off)
|
595.48
|
449.29
|
|
Un-allocable Income
|
591.21
|
-
|
|
TOTAL PROFIT BEFORE TAX
|
8,036.24
|
6,340.99
|
3
|
SEGMENT ASSETS
|
|
|
a
|
Laundry & Allied Products
|
13,159.36
|
11,635.58
|
b
|
IT Enabled Services
|
1,141.61
|
967.24
|
c
|
Windmill
|
1,023.18
|
1,053.40
|
d
|
Unallocated / Corporate
|
27,759.28
|
42,654.22
|
|
|
43,083.43
|
56,310.44
|
SI. NO.
|
Particulars
|
Year ended 31-03-2019
|
Year ended 31-03-2018
|
4
|
Segment Liabilities
|
|
|
a
|
Laundry & Allied Products
|
2,865.83
|
3,390.32
|
b
|
IT Enabled Services
|
368.46
|
195.79
|
c
|
Windmill
|
10.86
|
10.14
|
d
|
Unallocated / Corporate
|
1,349.34
|
1,606.13
|
|
|
4,594.49
|
5,202.38
|
|
TOTAL CAPITAL EMPLOYED IN THE COMPANY
|
38,488.94
|
51,108.06
|
42 Related party disclosures
1 Names of related parties and nature of relationship:
Nature of relationship
|
Name of related party
|
|
|
Key Management Personnel
|
Mr. R. Sam path
|
Chairman
|
Non-Executive
|
Mrs. Indira Sundararajan
|
Vice Chairperson
|
Non-Executive
|
Ms. Tara Parthasarathy
|
Joint Managing Director
|
Executive
|
Mr. R. Senthil Kumar
|
Whole-time Director
|
Executive
|
Dr. Gopakumar G. Nair
|
Director
|
Non Executive Independent
|
Mr. Nimish Patel
|
Director
|
Non Executive Independent
|
Mr. T.R Madhavan
|
Director
|
Non Executive Independent
|
Mr. Vinod G. Nehemiah
|
Director
|
Non Executive Independent
|
Mr. Navin M Ram
|
Director
|
Non Executive Independent
|
Mr. S. Ragothaman
|
Director
|
Non Executive Independent
|
Mr. Rajeev M. Pandia
|
Director
|
Non Executive Non Independent
|
Mr. C.R. Chandra Bob
|
Director
|
Non Executive Non Independent
|
Mr. S. Ramanan
|
Chief Financial Officer
|
|
Mr. Kishore Kumar Sahoo
|
Company Secretary
|
|
Enterprise over which the Key Managerial Personnel and their relatives are able to exercise significant influence.
|
Thirumalai Chemicals Limited
|
|
Thirumalai Charity Trust
|
|
Ahana LLC
|
|
Vedavalli Vidyalaya School ( a Unit of Akshaya Vidya Trust )
|
|
Relatives of Key Managerial Personnel
|
Mr. V. Bharatram
|
President(Operations), IT-Enabled Services and BPO activities Division
|
Ms. Meera Parthasarathy
|
Vice President(Operations), BPO Division
|
Ms. Vidya Sampath
|
|
2 Transactions carried out with related parties referred in 1 above, in ordinary course of business
|
2018-19
|
2017-18
|
Sales
|
|
|
Goods, Materials and Services
|
|
|
Thirumalai Chemicals Limited
|
0.36
|
0.38
|
Purchase
|
|
|
Goods, Materials and Services
|
|
|
Thirumalai Chemicals Limited
|
-
|
0.02
|
Remuneration paid to
|
|
|
Mr. V. Bharathram
|
104.06
|
62.08
|
Ms. Meera Parthasarathy
|
62.18
|
33.96
|
Remuneration to Key Managerial Personnel
|
|
|
Mrs. Indira Sundararajan
|
50.95
|
216.85
|
Ms. Tara Parthasarathy
|
71.57
|
63.88
|
Mr. R. Senthilkumar
|
48.60
|
45.66
|
Mr. S. Ramanan
|
32.74
|
32.74
|
Mr. Kishore Kumar Sahoo
|
16.25
|
13.77
|
Sitting fees and commission to Independent and Non-Executive Directors
|
105.13
|
89.68
|
Rendering of Services to
|
|
|
Thirumalai Chemicals Limited
|
7.58
|
21.07
|
Thirumalai Charity Trust
|
-
|
3.08
|
Vedavalli Vidyalaya School
|
0.64
|
0.33
|
Ahana LLC,USA
|
62.21
|
13.44
|
Rent Paid to
|
|
|
Thirumalai Chemicals Limited
|
38.21
|
37.68
|
Ms. Vidya Sampath
|
0.98
|
-
|
Receiving of services from
|
|
|
Thirumalai Chemicals Limited
|
1.15
|
1.32
|
Outstanding payables
|
|
|
Thirumalai Chemicals Limited
|
3.78
|
3.40
|
Advance received against sale of Property
|
|
|
Thirumalai Chemicals Limited
|
-
|
136.36
|
Directors Remuneration Payables
|
|
|
Mrs. Indira Sundararajan
|
19.64
|
160.22
|
Ms. Tara Parthasarathy
|
30.00
|
30.00
|
Mr. R. Senthilkumar
|
10.00
|
9.00
|
Non executive directors commission
|
73.53
|
64.08
|
Remuneration Payable
|
|
|
Mr. V. Bharathram
|
15.00
|
7.50
|
Outstanding receivables
|
|
|
Vedavalli Vidyalaya School
|
-
|
-
|
Thirumalai Charity Trust
|
-
|
0.09
|
Thirumalai Chemicals Limited
|
0.83
|
0.24
|
Ahana LLC
|
21.42
|
3.04
|
Donations paid
|
|
|
Thirumalai Charity Trust
|
88.00
|
70.00
|
Outstanding deposits receivables
|
|
|
Ms. Vidya Sampath
|
0.70
|
-
|
Thirumalai Chemicals Limited
|
14.00
|
14.00
|
43 Leases Operating lease
i) The company has taken certain premises for office use and godown under cancellable / non cancellable lease agreements. Some of these agreements have a price escalation clause. The lease rentals for the same are charged to Statement of Profit or Loss.
ii) Amounts recognised in profit or loss
Particulars
|
31st March, 2019
|
31st March, 2018
|
Lease expense
|
296.59
|
199.99
|
Contingent rent expense
|
-
|
-
|
iii Future minimum rentals payable under non - cancellable operating lease are as follows
Particulars
|
31st March, 2019
|
31st March, 2018
|
Payable
|
|
|
Within one year
|
291.56
|
285.42
|
After one year but not more than five years
|
877.01
|
1,074.88
|
More than five years
|
126.03
|
182.25
|
44 Earnings per share (EPS)
Basic 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 of the Company by the weighted average number of Equity shares outstanding during the year.
i. Profit attributable to Equity holders of Company
Particulars
|
31st March, 2019 INR
|
31st March, 2018 INR
|
Profit attributable to equity holders of the Company for basic and diluted earnings per share
|
5,647.83
|
4,364.31
|
ii. Weighted average number of ordinary shares
|
|
|
Particulars
|
31st March, 2019 INR
|
31st March, 2018 INR
|
Number of Issued equity shares at April 1
|
292,00,000
|
292,00,000
|
Effect of shares issued as
|
-
|
-
|
Nominal value per share
|
2
|
2
|
Weighted average number of shares at March 31 for basic and diluted earnings per shares
|
292,00,000
|
292,00,000
|
Basic earnings per share
|
19.34
|
14.95
|
46 CSR Expenditure
a) Gross amount required to be spent by the Company during the year - Rs100.24 Lakhs (31st March, 2018: Rs 76.29 Lakhs)
b) Amount spent during the year: Rs 107.00 Lakhs (31st March, 2018: Rs 90.21 Lakhs) out of which Rs 88.00 Lakhs contributed to Thirumalai Charity Trust registered u/s 35AC/80G of Income Tax Act, 1961, engaged in rural healthcare, women empowerment, disability, de-addiction and village development, surrounding the manufacturing location of the Company.
47 Exceptional items of Rs 591.21 Lakhs represent Surplus on transfer of leasehold land during the year.
48 Disclosures required as per Micro, Small and Medium Enterprises Development Act, 2006 .
The disclosure regarding Micro and Small Enterprises has been made to the extent such parties have been identified
45 Research and Development Expenditure
Particulars
|
As at 31 March 2019
|
As at 31 March 2018
|
The Company has Incurred Research and Development expenses as under:
|
|
|
On Capital Account:
|
|
|
Lab Equipment
|
28.43
|
17.42
|
On Revenue Account
|
|
|
Salaries & Allowances
|
75.06
|
79.40
|
Contributions to Provident fund and other funds
|
4.92
|
5.25
|
Chemicals and Consumables
|
17.14
|
14.72
|
Other Expenses
|
32.56
|
13.02
|
Total
|
158.11
|
129.81
|
Particulars
|
2018-19
|
2017-18
|
(i)
|
Principal amount and Interest payable to the suppliers as at the end of the accounting year
|
NIL
|
NIL
|
(ii)-
|
The amount of interest paid by the buyer in terms of Sec.16 of the Micro, Small and Medium Enterprises Development Act, 2006 along with the amount of payment made to the supplier beyond the appointed day during each accounting year
|
NIL
|
NIL
|
(iii)
|
The amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the interest specified under the Micro, Small and Medium Enterprises Development Act
|
NIL
|
NIL
|
(iv)
|
The amount of Interest accrued and remaining unpaid at the end of each accounting year.
|
NIL
|
NIL
|
(v)
|
The amount of further interest remaining due and payable in the succeeding years, until such date when the interest dues as above are actually paid to the small enterprise, for the purpose of disallowance as deductible expenditure u/s 23 of Micro, Small and Medium Enterprises Development Act, 2006
|
NIL
|
NIL
|
49 CIF Value of Imports
Rs in Lakhs
Particulars
|
Year ended 31 March, 2019
|
Year ended 31 March, 2018
|
Raw Materials
|
4,443.89
|
3,737.05
|
Machinery spares
|
0.40
|
0.57
|
Lab Equipment
|
1.24
|
0.65
|
Total
|
4,445.53
|
3,738.27
|
50. Expenditure in Foreign Currency
|
|
|
Travelling
|
35.00
|
39.13
|
Other Matters - Data procesing
|
-
|
0.11
|
Employees' Training & seminar expenses
|
27.21
|
26.66
|
Legal & Professional Charges
|
36.29
|
2.90
|
Printing and Stationary
|
7.72
|
-
|
Bank Charges
|
1.35
|
-
|
Telephone Expense
|
1.39
|
-
|
Subscription Fees
|
13.80
|
5.76
|
Software Expenses
|
0.80
|
2.47
|
Sales Promotion Expenses
|
9.05
|
38.58
|
Books,periodicals & subscriptions
|
5.14
|
4.47
|
Total
|
137.75
|
120.08
|
51. Earnings in foreign currencies
|
|
|
Export of goods calculated on FOB basis
|
6,027.26
|
4,992.64
|
Income from IT enabled services
|
3,430.79
|
2,663.65
|
Total
|
9,458.05
|
7,656.29
|
52 Previous years figures have been regrouped/reclassified wherever neccessary to correspond with the current year's classification/disclosure.
For and on behalf of
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For and on behalf of the Board of Directors
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Brahmayya & Co
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TARA PARTHASARATHY
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R. SENTHIL KUMAR T.R. MADHAVAN
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Chartered Accountants
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Joint Managing Director
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Whole-time Director Director
|
Firm Regn. No. 000511S
|
DIN :07121058
|
DIN -.07506927 DIN:00163992
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R.NAGENDRA PRASAD
|
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S. RAMANAN KISHORE KUMAR SAHOO
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Partner
|
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Chief Financial Officer Company Secretary
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Membership No.203377
|
|
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Place: Chennai
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|
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Date: 15th May, 2019
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|
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