b» Term frights attached to equity shares
The Company has one class of equity shares having face value of ? 1 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees, The dividend proposed ty the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting,
c, Terms/rights attached to preference shares
The preference shares shall be cumulative, redeemable, non-convcrtiblc, participating preference shares ('preference shares'), The preference shares shall carry a preferential right to dividends over the Equity Shares. The preference shares shall carry a fixed rate of preferential dividend at the rate of 0,0001% per annum In addition to the fixed rate of dividend, the preference shareholders shall, at their discretion, be entitled to additional preferential dividend and carry a preferential right to dividends over the equity shares, The preference shares shall be redeemed, from time to time as may be required by the preference shareholders at face value plus the redemption premium payable thereon no later than 20 years from the date of allotment or longer period as may be prescribed by law.
The holder of preference shares have a right to vote only oti resolutions placed before the company which directly affect the rights attached to preference shares and, atiy resolution for the winding up of the company or for the repayment or reduction of its equity or preference share capital and voting right on a poll shall be in proportion to the share in the paid-up preference share capital of the company, On winding up or repayment of capital, the preference shareholders shall carry a preferential right of repayment, * The members of the TVS Family had entered into a Memorandum of Family Arrangement (“MFA") dated 10 December 2020 in order to align and synchronize the ownership/ control over various companies/ businesses with the management of the respective companies, as was being done by the respective branches/ sub-branches of the TVS Family. In the context of the above, a Composite Scheme of Amalgamation and Arrangement ( ‘Scheme") under sections 230 to 232 of the Companies Act, 2013 was filed with Hon'blc National Company Law Tribunal, Chennai Bench (l<NCLT")and an order was pronounced on 6th December 2021 sanctioning the Scheme by the NCLT
Consequent to the same, and with effect from 4 February 2022, the TSR Mobility and Supply Chain Solutions Business Undertaking of T V Sundram Iyengar and Sons Private Limited (“TVSS") including 10,72,73,430 equity shares representing 29.70% equity shares of TVS Supply Chain Solutions Limited was, as a result of the demerger from TVSS, transferred to and vested upon TVS Mobility Private Limited ( formerly known as T,S,Rajam Distribution Services Private Limited), Consequent to the above, TVS Mobility along with its wholly owned subsidiaries, T, S. Rajam Rubbers and Dhinrama Mobility acquired control of our Company from T, V, Sundram Iyengar &. Sons Private Limited, Ramachandhran Dinesh was au original Promoter of our Company.
24B Other Equity
Securities premium
Securities premium is used to record the premium received on issue of shares It is utilised in accordance with the provisions for the Companies Act, 2013.
Capital reserve
During prior years, the Company had reissued the shares forfeited, The profit on reissue of such forfeited shares has been transferred to capital reserve.
Capital redemption reserve
During the year ended 31 March 2018, the Company had redeemed preference shares issued to Tata International Limited and Tata Industries Limited, out of profits of the Company. A sum equivalent to the nominal amount of the shares redeemed had been transferred to capital redemption reserve in accordance with the provisions of the Companres Act, 2013.
Share options
The Company has Management Incentive Plan (MIP) scheme under which share options are granted to employees which has been approved by the shareholders of the company, In accordance with the terms of the plan, eligible employees may be granted options to purchase equity shares of tlie Company if they are in service on exercise of the grant. Each employee share option converts into one equrty share of the company on exercise at the exercise price as per the scheme. The option carry nerther rights to dividend nor voting rights. Options can be exercised at anytime from the date of vesting to the date of their expiry.
Compulsorily convertible preference shares
On June 8, 2018 and August 22, 2018, the Company has allotted 13,340 and 25,660 Non- Cumulative, Non-Participating, Compulsorily Convertible Preference Shares (“CCPS"') off 10 each respectively, at a premium of ? 940 each to identified persons on a preferential basis for a consideration off 126,73 lakhs and f 243.77 lakhs respectively, CCPS carry a dividend of 0.001% per annum and the dividend lights are non- cumulative. On November 20, 2018, the Company has issued bonus shares of 151,000 to the shareholder's of CCPS iti the ratio of 1:3.87 and the securities premium account was utilised to the extent of f 15.10 lakhs for the issue of said bonus shares. The preference shares to be converted into equal number of equity shares ranking pari-passu with the existing equity shares, after the end of four years from the date of issue or earlier at the option of the Board In the event of liquidation of the Company before conversion of preference shares, the holders of preference shares will have priority over equity shares in the repayment of capital. During the previous year ended 31st March, 2022 the Company has converted 69,998 preference shares into equity shares of 69,998 ranking pari-passu with the existing equity shares. These shares have been sub-divided into ? 1 each in the extraordinary general meeting held on January 31, 2022. During the year ended March 31, 2023, the Company has converted 1,20,002 preference shares rnto equity shares of 12,20,020 of face value ? 1 each ranking pari-passu with the exrstitig equity shares.
On February 7, 2020, the Company has allotted 10,23,350 Series A Compulsorily Convertible Preference Shares (“CCPS) of ? 100 each, at a premium of? 1610.07 each to Mahogany Singapore Company Pte, Ltd (“CCPS Holder”) on a preferential basis, for a consideration of approx, ? 17,500 lakhs. Each CCPS carries a minimum preferential dividend rate of 0,0001% and in addition to and after payment of such preferential dividend, the CCPS Holder would be entitled to participate pari-passu in any dividends paid to the holders of shares of any other class (including equity shares) or series on a pro rata, as-ifeouverted basis. Each CCPS would be converted into fully paid-up equity shares ranking pari-passu with the existing equity shares, in the ratio of 1: l (subject to such adjustments as contemplated in the subscription agreement dated January 22, 2020 executed by and amongst inter alia the Company and the CCPS Holder (“SSA”)), on the earlier of (i) expiry of a period of 18 (eighteen) months from the closing date (as defined under the SSA) (February 7, 2020); and (ii) the date when a prospective shareholder (as defined under the SSA) (including such prospective shareholder’s affiliates) acquires equity shares or equity securities convertible into equity shares representing, in the aggregate, at least 7% (Seven percent) of the then share capital of the Company (on a fully diluted basis) (in oue or more transactions). During the year ended 31st March 2022, the Company has converted the entire 10,23,350 CCPS into 12,08,931 equity shares of ? 10 each at a premium of? 1,437,56 per share These shares have been sub-divided into ? 1 each in the extraordinary general meeting held on January 31, 2022.
On December 16, 2022 and December 27, 2022, the Company has allotted 30,45,694 and 1,07,526 Series A Compulsonly Convertible Preference Shares (1<CCPS") of ? 100 each, at a premium of? 272 each respectively to identified persons on a preferential basis, for a consideration of approx, ? 11,720,00 lakhs. Each CCPS carries a cumulative preferential dividend rate of 0 0001% per annum on the subscription price of the CCPS and shall be non-participating preference shares. CCPS convertible compulsorily and automatically into such number of equity shares as per a pre-determined formula at the conversion date, which is linked to the likelihood of IPO happening before a particular date as specified in the share purchase agreements and various possible valuation outcomes from the IPO of the equity shares of the Company. CCPS is convertible into variable number of equity shares of the Company and hence has been classified as a liability at fair value through profit and loss.
On March 29,2023 and March 31, 2023 , the Company has allotted 2,777,778 and 6,944,444 Series E Compulsonly Convertible Preference Shares ("CCPS" ) of ? 1 each, at a pie mi um of? 179 each respectively to identified persons on a preferential basis, for a consideration of approx. ? 17,500.00 lakhs. Each CCPS carries a cumulative preferential dividend rate of 0.0001% per annum on the subscription price of the CCPS and shall be non-participating preference shares. CCPS convertible compulsorily and automatically into such number of equity shares as per a pre-determined formula at the conversion date, which is linked to the likelihood of IPO happening before a particular date as specified in the share purchase agreements. CCPS is convertible into variable number of equity shares of the Company and hence has been classified as a liability at fair value through profit and loss.
6 Secured Joans
Secured term loan front banks
Term loans from HDFC Bank Limited are secured by hypothecation of vehicles acquired out of the loan,
Foreign currency term loan from IDFC First Bank Limited arc secured by hypothecation of movable fixed assets.
Term loan from IDFC First Bank Limited are secured gaianst non-current portion of security deposit.
Secured loans repayable on demand from banks
Working capital loan from DBS Bank was secured upto Rs.lO crore against the debtors of the company,
C Redeemable Preference Shares
The Company has cumulative, redeemable, non-convcrtiblc, participating preference shares. These preference shares have been classified as a liability, For rights, preferences and restrictions attached to preference shares attached to these preference shares refer note 24
F Wilful Defaulter
The Company is not declared as wilful defaulter by any bank of financial institution or other lender,
G Utilisation of borrowings
a) The Company has used the borrowings from banks for the specific purpose for which it was taken at the balance sheet date.
b) The quarterly returns/statements of current assets filed by the Company with banks in relation to secured borrowings wherever applicable, are in agreement with the books of accounts.
H Compulsorily Convertible Preference Shares
The carrying amount approximates the fair value of the instrument and the value of CCPS is f2 9,229.9 8 lakhs.
30 Employee benefits
Defined contribution plans
The Company makes contributions, determined as a specified percentage of employee salaries, in respect of qualifying employees towards Provident Fund (PF) and employees' state insurance (ESI) scheme which are defined contribution plans. The Company has no obligations other than to make the specified contributions. The contributions are charged to the statement of profit and loss as they accrue. The amount recognised as an expense towards contribution to Provident Fund and ESI for the year aggregated to ? 3,45S,77 lakhs (31 March 2022: ? 3,082,86 lakhs).
The Company has a defined benefit gratuity plan in India (the Plan), governed by the Payment of Gratuity Act, 1972. The Plan entitles an employee, who has rendered at least five years of continuous service, to gratuity at the rate of fifteen days wages for every completed year of service or part thereof in excess of six months, based on the rate of wages last drawn by the employee at the time of retirement, death or termination of employment.
These defined benefit plans ex|xise the Company to actuarial risks, such as longevity risk, interest rate risk and market (investment) risk,
A. Funding
The gratuity plan of the Company is a partially funded plan with the Company making periodic contributions to a fund managed by Life Insurance Corporation (LIC).
Share based payments
The company has Management Incentive Plan (MIP) scheme under whieh sliai e options are granted to employees which has been approved by the shareholder s of the company In accordance with the terms of the plan, eligible employees may be granted options to purchase equity sltares of the company if they are in seivice on exercise of the giant, Eaeh employee share option converts into one equity share of the company on exercise at the exercise price as per the scheme. Tire option cany neither rights to dividend nor voting rights Options can be exercised at any time from the date of vesting to the date of their expi ly.
Fair value of share options granted during the year
[hiring the year ended 31 March 2023 the Company has not granted any stock options. The weighted average fair value of the stock options granted during the year ended 31 March 2022 ? 51.10 (MIP I) & ? 43.80 (MIP II)*. Options were priced using a Black Sc holes option valuation model & Monte Carlo simulation mode] for MIP I and II respectively. Where relevant the expected life used in the model has been adjusted based on managements best estimate for the effects of non-transferability, exercise restrictions and behavioural considerations. Expected volatility is based on the historical share price volatility of guideline companies in developed and developing countries.
31 Leases
A Finance leases as lessor
The Company’s leasing arrangement represents the certain forklifts and other assets given to customers which have been classified under Ind AS 116 on Leases as Finance lease The lease term covers the substantial period of the assets and all the risks and rewards of ownership are transferred to the lessee The Company records disposal of the property concerned and recognizes the finance income as part of Other income.
From time to time, the Company is involved in claims and legal matters arising in the ordinary course of business. Management is not currently aware of any matters that will have a material adverse effect on the financial position, results of operations, or cash flows of the Company.
* The Company has challenged the demand orders from PF authorities amounting to ? 2,183.59 Lakhs for the periods April 2011 to February' 2015 on the grounds that provident fund on certain allowances need not be included for calculation of the Provident Fund contribution, as the same is not universally paid to all the employees of the Company.
The Hon’ble Supreme Court of India by their order dated February 28, 2019, set out the principles based on which allowances paid to the employees should be identified for inclusion for the purposes of computation of the Provident Fund contribution. Consequently', the Company has filed a review petition to Regional Provident Fund Commissioner to review the demand order in the light of the Supreme Court decision. The Company has also obtained an interim injunction from Honourable High Court of Madras pending disposal of the Company’s petition. Based on legal advice obtained, file Company is of the view tliat no provision is required for the dispute in the financials as at Match 31, 2023. During the year ended March 31, 2023 the Company has paid a deposit of ? 360 lakhs agianstthis case.
33 Due to micro, small and medium enterprises
The management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small entetprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006. Accordingly, the disclosure in respect of the amounts payable to such enterprises as at 31 March 2023 has been made in these standalone financial statements based on information received and available with the Company, to the extent identified by the management.
35 Transfer pricing
The Company has international transactions with related parties. The management confirms that all such transactions are in compliance with the provisions of Income-tax Act 1961. The management also confirms that it maintains documents as prescribed by the Income Tax Act to prove that the international and domestic transactions are at arm’s length and the aforesaid legislation will not have any impact on the standalone financial statements, particularly on the amount of tax expense and that of provision for taxation.
37 Financial instruments - Fair values and risk management (continued)
B. Financial risk management
The Company has exposure to the following risks arising from financial instruments:
- credit risk;
- liquidity risk; and
- market risk
i. Risk management framework
The Company’s board of directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. The board of directors along with the senior management are responsible for developing and monitoring the Company’s risk management policies.
The Company’s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.
ii 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 investments.
The carrying amounts of financial assets represent the maximum credit risk exposure.
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 establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of the Company’s trade receivables, certain loans and advances and other financial assets.
Trade and other receivables
The Company’s exposure to credit risk is influenced mainly by' the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment.
Exposures to customers outstanding at the end of each reporting period are reviewed by the Company to determine incurred and expected credit losses. The impairment loss at the reporting dates relates to several customers that have defaulted on their payments to the Company and are not expected to be able to pay their outstanding balances, mainly due to economic circumstances.
The Company determines credit risk based on a variety' of factors including but not limited to the age of the receivables, cash flow projections and available information about customers from mternaL'external sources. The Company establishes an allowance for impairment that represents its estimate of expected losses in respect of trade receivables
Cash and cash equivalents and other bank balances
The Company holds cash and bank balances of 732 329.17 lakhs as at 31 March 2023 (31 March 2022: 729,245.16 lakhs). The credit worthiness of such banks and financial institutions are evaluated by the management on an ongoing basis and is considered to be good.
Deposits and other receivables
The Company has Deposits and other receivables of 735,712.46 lakhs as at 31 March 2023 (31 March 2022: 728,055.26 lakhs). It consists of deposit given in relation to leasehold premises occupied by the Company for carrying out its operations and receivable from subsidiaries. The Company does not expect any losses from non-performance by these counter-parties.
Loans, Investments and Other financial assets
The Company has loans, investments and other financial assets of 779,234 42 lakhs as at 31 March 2023 (31 March 2022: 744,309.03 lakhs). The credit worthiness of such parties are evaluated by the management on an ongoing basis and are provided wherever necessary and the remaining balances are considered to be good.
Hi 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 Company's approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.
37 Financial instruments - Fair values and list management (continued)
iv. Market risk
Market risk is the risk that changes in market prices - such as foreign exchange rates and interest rates 'will affect the Company's income or the value of it's holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters and optimising the return.
Currency risk
The Company is exposed to currency risk to the extent that there is a mismatch between the currencies in which revenues, loans given to related parties and other payables and receivables are denominated in a currency other than the INR. The company does not hedge its foreign currency risk in general except in case of certain payables and receivables denominated in foreign currency which are hedged through the use of forward exchange contracts. The Company does not apply hedge accounting in respect of such forward exchange contracts.
(i) During the prior year ended 31 March 2022, the Company has sold the entire debenture instruments to Drive India Enterprise Solutions Limited for a consideration of ? 1,822.10 lakhs and derecognised the investment in debentures along with the interest accrued. The Company incurred a net loss of? 138.94 lakhs for the year ended 31 March 2022.
(ii) Upto the year ended 31 March 2021, the Company classified its investment in Drive India Enterprise Solutions Limited as assets held for sale and measured the same in accordance with Ind AS 105 "Non Current Assets held for Sale and Discontinued Operations" at lower of its carrying amount and fair value less cost to sell. During the year ended March 31, 2022, the Company entered in to Share Purchase Agreement dated September 29, 2021 (“New SPA”) with the Buyer for disposal of investments in DIESL for a consideration of? 100 lakhs.
44 Disclosure on funding transactions
During the year, the Company has given loans amounting to Rs.19,878,49 lakhs and Rs,11,748.29 lakhs and to its wholly owned subsidiaries, TVS Logistics Investments UK Limited and TVS Logistics Investments USA Inc., respectively in its ordinary course of business, which are in compliance with the provisions of Companies Act, 2013 and Foreign Exchange Management Act 1999 and Prevention of Money-Laundering Act, 2002 The loans given to TVS Logistics Investments USA Inc has been used for repayment of loans and providing additional loan to TVS Logistics Investments UK Limited Further, of the loans given to TVS Logistics Investments UK Limited, Rs. 6,764.31 lakhs has been loaned to step down subsidiaries. Other than the above, there are no funds that have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Group to or in any other person(s) or entities, including foreign entities (“Intermediaries”), with the under standing, whether recorded in writing or otherwise, that the Intermediary shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
There are no funds that have been received by the Company from any person(s) or entities, including foreign entities (‘‘Funding Parties”), with the understanding, whether recorded in wilting or otherwise, that the Company shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries
46 Subsequent events
There are no significant subsequent events that have occurred after the reporting period till the date of these consolidated financial statements other than the below.
(i) On March 30, 2023, the Company entered into share subscription agreement ("SSA”) with Hero Enterprise Partner Ventures. Pursuant to the SSA and first amendment to such share purchase agreement dated April 13, 2023, on April 17, 2023, the Company issued 6,944,444 number of Compulsorily Convertible Preference Shares (CCPS) with a face value of? 1 aggregating ? 12,300 lakhs and carrying a preferential dividend rate of 0.0001% per annum. These CCPS shall have an initial conversion ratio of 1:1 and shall be converted into equity shares of the Company based on a pre-determined formulae specified in the Share purchase agreements.
(ii) On March 25, 2023, the Company entered into share subscription agreements ("SSA") with investors Pursuant to the SSA and first amendment dated April 19, 2023 to such SSA, the Company issued 3,333,333 number of Compulsorily Convertible Preference Shares (CCPS) with a face value of ? 1 aggregating ? 6,000 lakhs and carrying a preferential dividend rate of 0 0001% per annum. These CCPS shall have an initial conversion ratio of 1:1 and shall be converted into equity shares of the Company based on a pre-determined fomtulae specified in the Share purchase agreements.
(iii) On March 25, 2023, the Company entered into share subscription agreements ("SSA") with investors. Pursuant to the SSA, first amendment dated April 19, 2023 and second amendment dated June 26, 2023 to such SSA, the Company issued 833,333 number of Compulsorily Convertible Preference Shares (CCPS) with a face value of? 1 aggregating ? 1,500 lakhs and carrying a preferential dividend rate of 0.0001% per annum. These CCPS shall have an initial conversion ratio of 1:1 and shall be converted into equity shares of the Company based on a pre-determined formulae specified in the Share purchase agreements.
(iv) On March 28, 2023, the Company' entered in to share purchase agreement ("SPA") with the minority shareholders at White Data Systems India Private Limited ("WDS") to acquire their 49% equity stake in that Company. Pursuant to the SPA and first amendment to such share purchase agreement dated April 11, 2023, our Company acquired 49% of the equity stake of WDS, from the minority shareholders. Asa consideration lor such acquisition, through a share swap, our Company has allotted 3,547,840 Senes E CCPS (“Purchase Shares1') to the minonty shareholders, pursuant to a preferential allotment for consideration other than cash, at a price of? 180 per Purchase Share.
47 Struck off companies
The Company does not have any' material transactions with companies shuck off.
48 Prior year comparatives
To conform to this period’s classification, certain previous year figures have been reclassified'regrouped wherever necessary.
|