10. PROVISIONS, CONTINGENT LIABILITIES AND
CONTINGENT ASSETSI. Provisions
The Company recognises a provision when it has
a present legal or constructive obligation as a
result of past events, it is likely that an outflow of
resources will be required to settle the obligation;
and the amount has been reasonably estimated.
Unwinding of the discount is recognised in the
Statement of Profit and Loss as a finance cost.
II. Contingent Liabilities
Contingent liability is a possible obligation
arising from past events and whose existence
will be confirmed only by the occurrence or non¬
occurrence of one or more uncertain future events
not wholly within the control of the Company or a
present obligation that arises from past events but
is not recognised because it is not probable that
an outflow of resources embodying economic
benefits will be required to settle the obligation or
the amount of the obligation cannot be measured
with sufficient reliability.
III. Contingent Assets
A contingent asset is not recognised unless
it becomes virtually certain that an inflow of
economic benefit will arise. When an inflow
of economic benefits is probable, contingent
assets are disclosed in the financial statements.
Provisions, contingent liabilities and contingent
assets are reviewed at each balance sheet date.
IV. Onerous Contracts:
A provision for onerous contracts is measured
at the present value of the lower expected costs
of terminating the contract and the of expected
cost of continuing with the contract. Before a
provision is established, the Company recognises
impairment on the assets with the contract.
11. TAXES:
The tax expenses comprise of current tax and deferred
income tax charge or credit. Tax is recognised in
Statement of Profit and Loss, except to the extent that it
relates to items recognised in the Other Comprehensive
Income or in Equity. In which case, the tax is also
recognised in Other Comprehensive Income or Equity
respectively.
• Current Tax:
• Tax on income for the current period is
determined on the basis of estimated
taxable income and tax credits computed
in accordance with the provisions of the
relevant tax laws and based on the expected
outcome of assessments/ appeals. The
current income tax charge is calculated
on the basis of the tax laws enacted or
substantively enacted at the end of the
reporting period.
• The Company periodically evaluates
positions taken in the tax returns with respect
to matters where applicable tax regulations
are subject to interpretation and recognises
provisions, where appropriate.
• Current tax assets and current tax liabilities
are set-off when there is a legally enforceable
right to set-off the recognised amounts and
there is an intention to settle the asset and
the liability on a net basis.
• Deferred Tax:
• Deferred tax is recognised on temporary
differences between the carrying amounts
of assets and liabilities in the Company’s
financial statements and the corresponding
tax bases used in computation of taxable
profit and quantified using the tax rates and
laws enacted or substantively enacted as on
the Balance Sheet date.
• Deferred tax liabilities are recognised for
all taxable temporary differences at the
reporting date between the tax base of assets
and liabilities and their carrying amounts
for financial reporting purposes. Deferred
tax assets are recognised for all taxable
temporary differences to the extent that is
probable that taxable profits will be available
against which those deductible temporary
differences can be utilised.
• The carrying amount of deferred tax assets is
reviewed at the end of each reporting period
and reduced to the extent that it is no longer
probable that sufficient taxable profits will be
available to allow all or part of the asset to be
recovered.
• Unrecognised deferred tax assets are
reassessed at each reporting and are
recognised to the extent that it has become
probable that future taxable profits will be
available against which the deferred tax
assets to be recovered.
• The measurement of deferred tax liabilities
and assets reflects the tax consequences
that would follow from the manner in which
the Company expects, at the end of reporting
period, to recover or settle the carrying
amount of its assets and liabilities.
• Transaction or event which is recognised
outside profit or loss, either in other
comprehensive income or in equity, is
recorded in other comprehensive income or
in equity along with the tax as applicable.
• Deferred tax assets and deferred tax liabilities
are offset when there is a legally enforceable
right to set-off the recognised amounts and
there is an intention to settle the asset and
the liability on a net basis.
12. REVENUE RECOGNITION:I. Revenue from Operations:
Ind AS 115 applies, with limited exceptions, to all
revenue arising from contracts with its customers.
Ind AS 115 establishes a fivestep model to account
for revenue arising from contracts with customers
and requires that revenue be recognised at an
amount that reflects the consideration to which
an entity expects to be entitled in exchange for
transferring goods or services to a customer.
Ind AS 115 requires entities to exercise judgment,
taking into consideration all of the relevant facts
and circumstances when applying each step of
the model to contracts with their customers. It
also specifies the accounting for the incremental
costs of obtaining a contract and the costs directly
related to fulfilling a contract.
II. Sale of Goods:
The Company recognises revenue from sale
of goods measured upon satisfaction of
performance obligation which is at a point in
time when control of the goods is transferred to
the customer, generally on delivery of the goods.
Depending on the terms of the contract, which
differs from contract to contract, the goods are
sold on a reasonable credit term. Revenue is
measured based on the transaction price, which is
the consideration, adjusted for volume discounts,
rebates, scheme allowances, price concessions,
incentives, and returns, if any, as specified in the
contracts with the customers. Revenue excludes
taxes collected from customers on behalf of the
government.
Delivered-Incoterms revenue deferral & goods-
in-transit
For sales under 'delivered' Incoterms (e.g. DAP,
DDP), control transfers on delivery at the agreed
destination. Where such goods are in transit at
the reporting date, the performance obligation is
not yet satisfied, revenue is deferred (recognised
as a contract liability) and the goods are carried
in inventories as finished goods-in-transit at cost
until control passes on delivery
III. Sale of Services:
Revenue from services is recognised when the
performance obligation is met and the right to
receive income is established.
IV. Interest Income:
For all debt instruments measured either at
amortised cost or at fair value through other
comprehensive income, interest income is
recorded using the effective interest rate (EIR). EIR
is the rate that exactly discounts the estimated
future cash payments or receipts over the expected
life of the financial instrument or a shorter period,
where appropriate, to the gross carrying amount
of the financial asset or to the amortised cost of
a financial liability. When calculating the effective
interest rate, the Company estimates the expected
cash flows by considering all the contractual
terms of the financial instrument (for example
prepayment, extension and similar options) but
does not consider the expected credit losses.
Interest income is included in other income in the
statement of profit and loss.
V. Dividend Income:
Dividend income is recognised when the
Company's right to receive the payment is
established, which is generally when shareholders
approve the dividend.
VI. Export Incentives:
Eligible export incentives are recognised in the
year in which the conditions precedent are met
and there is no significant uncertainty about the
collectability.
VII. Other Income:
Revenue with respect to Other Operating Income
and Other Income including insurance and other
claims are recognised when a reasonable certainty
as to its realisation exists.
13. LEASES:
The Company evaluates each contract or arrangement,
whether it qualifies as lease as defined under Ind AS
116.
1) As a Lessee:
The Company assesses, whether the contract is,
or contains, a lease, at its inception. A contract
is, or contains, a lease if the contract conveys the
right to -
• control the use of an identified asset,
• obtain substantially all the economic benefits
from use of the identified asset, and
• direct the use of the identified asset
The Company determines the lease term as the
non-cancellable period of a lease, together with
periods covered by an option to extend the lease,
where the Company is reasonably certain to
exercise that option.
The Company at the commencement of the
lease contract recognises a Right-of-Use (RoU)
asset at cost and corresponding lease liability,
except for leases with term of less than twelve
months (short term leases) and low-value assets.
For these short term and low value leases, the
Company recognises the lease payments as an
operating expense on a straight-line basis over the
lease term.
The cost of the right-of-use asset comprises the
amount of the initial measurement of the lease
liability, any lease payments made at or before
the inception date of the lease, plus any initial
direct costs incurred and an estimate of costs to
dismantle and remove the underlying asset or to
restore the underlying asset or the site on which it
is located, less any lease incentives received.
The Right-of-Use asset is subsequently
depreciated using the straight-line method from
the commencement date to the earlier of the
end of the useful life of the Right-of-Use asset or
the end of the lease term. The estimated useful
lives of Right-of-Use assets are determined on
the same basis as those of property, plant and
equipment. In addition, the Right-of-Use asset is
periodically reduced by impairment losses, if any,
and adjusted for certain remeasurements of the
lease liability.
For lease liabilities at the commencement of the
lease, the Company measures the lease liability
at the present value of the lease payments that
are not paid at that date. The lease payments
are discounted using the interest rate implicit in
the lease, if that rate can be readily determined,
if that rate is not readily determined, the lease
payments are discounted using the incremental
borrowing rate that the Company would have to
pay to borrow funds, including the consideration
of factors such as the nature of the asset and
location, collateral, market terms and conditions,
as applicable in a similar economic environment.
After the commencement date, the amount of
lease liabilities is increased to reflect the accretion
of interest and reduced for the lease payments
made.
Lease payments included in the measurement
of the lease liability comprises fixed payments,
including amounts expected to be payable under
a residual value guarantee and the exercise price
under a purchase option that the Company is
reasonably certain to exercise, lease payments
in an optional renewal period if the Company
is reasonably certain to exercise an extension
option. The lease liability is subsequently
measured at amortised cost using the effective
interest method.
Each lease rental paid is allocated between the
liability and the interest cost, so as to obtain
a constant periodic rate of interest on the
outstanding liability for each period. Finance
charges are recognised as finance costs in the
statement of profit and loss.
2) Short-term leases and leases of low-value assets
The Company applies the short-term lease
recognition exemption to its short-term leases (i.e.,
those leases that have a lease term of 12 months
or less from the commencement date). It also
applies the lease of low-value assets recognition
exemption to leases that are considered of low
value (range different for different class of assets).
Lease payments on short-term leases and leases
of low-value assets are recognised as expense on
a straightline basis over the lease term.
14. BORROWING COSTS:
Borrowing costs that are directly attributable to the
acquisition or construction of qualifying assets are
capitalised as part of the cost of such assets. A
qualifying asset is one that necessarily takes substantial
period of time to get ready for its intended use. All other
borrowing costs are charged to the Statement of Profit
and Loss for the period for which they are incurred.
Borrowing costs consist of interest and other costs
that an entity incurs in connection with the borrowing
of funds. Borrowing cost also includes Bank Charges,
exchange differences to the extent regarded as an
adjustment to the borrowing costs.
In determining the amount of borrowing costs eligible
for capitalisation, any income earned on the temporary
investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the
borrowing costs eligible for capitalisation.
15. FOREIGN CURRENCY TRANSACTIONS:
Foreign currency transactions are recorded on initial
recognition in the functional currency, using the
exchange rate at the date of the transaction. At each
Balance Sheet date, foreign currency monetary items
are reported using the closing rate. Non-monetary
items that are measured in terms of historical cost in
a foreign currency are translated using the exchange
rate as at the date of initial transactions. Exchange
differences that arise on settlement of monetary items
or on reporting of monetary items at each Balance
Sheet date are recognised in profit or loss in the period
in which they arise except for exchange differences
on foreign currency borrowings relating to assets
under construction for future productive use, which
are included in the cost of those assets when they are
regarded as an adjustment to interest costs on those
foreign currency borrowings.
16. EARNINGS PER SHARE:
I. Basic earnings per share is calculated by dividing
the net profit or loss for the year attributable to
equity shareholders by the weighted average
number of equity shares outstanding during the
reporting period. The weighted average number
of equity shares outstanding during the period
and for all periods presented is adjusted for
events such as bonus issue; bonus element in a
rights issue to existing shareholders; share split;
and reverse share split (consolidation of shares)
that have changed the number of equity shares
outstanding, without a corresponding change in
resources.
II. For the purpose of calculating diluted earnings
per share, the net profit or loss for the period
attributable to equity shareholders and the
weighted average number of shares outstanding
during the period are adjusted for the effects of all
dilutive potential equity shares.
17. EXCEPTIONAL ITEMS:
When items of income or expense within the statement
of profit & loss from ordinary activities are of such size,
nature or incidence that their disclosure is relevant to
explain the performance of the Company for the period,
the nature and amount of such material items are
disclosed separately as exceptional items.
18. FINANCIAL INSTRUMENTS:
A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability
or equity to another entity. The Company determines
the classification of its financial assets and liabilities at
initial recognition
A. Initial Recognition:
Financial assets and/or financial liabilities are
recognised when the Company becomes party
to a contract embodying the related financial
instruments. All financial assets, financial liabilities
and financial guarantee contracts are initially
measured at transaction values and where such
values are different from the transaction values, at
fair values. Transaction costs that are attributable
to the acquisition or issue of financial assets and
financial liabilities that are not at fair value through
profit or loss are added to or deducted from as
the case may be, from the fair value of on initial
recognition.
B. Classification and Subsequent Measurement of
Financial Assets:
The Company classifies financial assets,
subsequently at amortised cost, Fair Value
through Other Comprehensive Income ("FVTOCI")
or Fair Value through Profit or Loss ("FVTPL") on
the basis of following:
• the entity’s business model for managing the
financial assets and
• the contractual cash flow characteristics of
the financial asset.
i. Financial Assets measured at
Amortised Cost:
A Financial Asset is measured at
amortised Cost if it is held within a
business model whose objective is
to hold the asset in order to collect
contractual cash flows and the
contractual terms of the Financial Asset
give rise on specified dates to cash
flows that represent solely payments
of principal and interest on the principal
amount outstanding.
ii. Financial Assets measured
at Fair Value Through Other
Comprehensive Income (FVTOCI):
A Financial Asset is measured at
FVTOCI if it is held within a business
model whose objective is achieved by
both collecting contractual cash flows
and selling Financial Assets and the
contractual terms of the Financial Asset
give rise on specified dates to cash
flows that represents solely payments
of principal and interest on the principal
amount outstanding.
iii. Financial Assets measured at Fair Value
Through Profit or Loss (FVTPL):
FVTPL is a residual category for financial
assets. Any financial asset, which does
not meet the criteria for categorisation
as at amortised cost or as FVTOCI, is
classified as at FVTPL
C. Classification and Subsequent Measurement of
Financial Liabilities:
i. Financial liabilities measured at Fair Value
Through Profit or Loss (FVTPL):
Financial liabilities are classified as FVTPL
when the financial liability is held for trading
or is a derivative (except for effective hedge)
or are designated upon initial recognition as
FVTPL. Gains or Losses, including any interest
expense on liabilities held for trading are
recognised in the Statement of Profit and Loss.
ii. Other Financial liabilities:
Other financial liabilities (including loans and
borrowings, bank overdraft and trade and
other payables) are subsequently measured
at amortised cost using the effective interest
method.
The effective interest rate is the rate that
exactly discounts estimated future cash
payments (including all fees and amounts
paid or received that form an integral part of
the effective interest rate, transaction costs
and other premiums or discounts) through
the expected life of the financial liability, or
(where appropriate) a shorter period, to the
amortised cost on initial recognition.
Interest expense (based on the effective
interest method), foreign exchange gains and
losses, and any gain or loss on derecognition
is recognised in the Statement of Profit and
Loss.
For trade and other payables maturing within
one year from the Balance Sheet date, the
carrying amounts approximate fair value due
to the short maturity of these instruments.
D. Debt and Equity Instruments:
Debt and equity instruments issued by the
Company are classified as either financial liabilities
or as equity in accordance with the substance of
the contractual arrangements and the definitions
of a financial liability and an equity instrument.
E. Equity Investments
All equity investments in the scope of Ind AS 109 are
measured at fair value. Equity instruments which
are held for trading are classified as at FVTPL. For
all other equity instruments, the Company may
make an irrevocable election to present in other
comprehensive income subsequent changes in
the fair value. The Company makes such election
on an instrument-by-instrument basis. The
classification is made on initial recognition and is
irrevocable. If the Company decides to classify an
equity instrument as at FVTOCI, then all fair value
changes on the instrument, excluding dividends,
are recognised in the OCI. There is no recycling of
the amounts from OCI to statement of profit and
loss, even on sale of investment. However, the
Company may transfer the cumulative gain or loss
within equity. Equity instruments included within
the FVTPL category are measured at fair value
with all changes recognised in the statement of
profit and loss.
F. Investments in subsidiaries:
Investments in subsidiaries and joint ventures
are carried at cost less accumulated impairment
losses, if any. Where an indication of impairment
exists, the carrying amount of the investment
is assessed and written down immediately to
its recoverable amount. On disposal of such
investments, the difference between net disposal
proceeds and the carrying amounts are recognised
in the statement of profit and loss.
G. De-recognition of Financial Instruments:
The Company derecognises a Financial Asset
when the contractual rights to the cash flows
from the Financial Asset expire or it transfers
the Financial Asset and the transfer qualifies for
de-recognition under Ind AS 109. In cases where
Company has neither transferred nor retained
substantially all of the risks and rewards of the
financial asset, but retains control of the financial
asset, the Company continues to recognise such
financial asset to the extent of its continuing
involvement in the financial asset. In that case, the
Company also recognises an associated liability.
The financial asset and the associated liability are
measured on a basis that reflects the rights and
obligations that the Company has retained.
A Financial liability (or a part of a financial
liability) is derecognised from the Company’s
Balance Sheet when the obligation specified in
the contract is discharged or cancelled or expires.
When an existing financial liability is replaced by
another from the same lender on substantially
different terms, or the terms of an existing liability
are substantially modified, such an exchange or
modification is treated as the derecognition of
the original liability and the recognition of a new
liability.
The difference between the carrying amount
of the financial liability de-recognised and the
consideration paid and payable is recognised in
the Statement of Profit and Loss.
H. Impairment of Financial Assets:
The Company assesses at each date of balance
sheet whether a financial asset or a group of
financial assets is impaired. Ind AS 109 requires
expected credit losses to be measured through a
loss allowance. The Company recognises lifetime
expected losses for all contract assets and / or all
trade receivables that do not constitute a financing
transaction. In determining the allowance for
expected credit losses, the Company has used a
practical expedient by computing the expected
credit loss allowance for trade receivables based
on a provision matrix. The provision matrix takes
into account historical credit loss experience
and is adjusted for forward looking information.
The expected credit loss allowance is based on
the ageing of the receivables that are due and
allowance rates used in the provision matrix. For all
other financial assets, expected credit losses are
measured at an amount equal to the 12-months
expected credit losses or at an amount equal to
the life time expected credit losses if the credit risk
on the financial asset has increased significantly
since initial recognition.
I. Offsetting of Financial Instruments:
Financial assets and financial liabilities are offset
and presented on net basis in the balance sheet
when there is a legally enforceable right to set¬
off the recognised amounts and it is intended to
either settle them on net basis or to realise the
asset and settle the liability simultaneously.
Fair Value of Financial Instruments
In determining the fair value of its financial
instruments, the Company uses a variety of
methods and assumptions that are based on
market conditions and risks existing at each
reporting date. The methods used to determine
fair value include discounted cash flow analysis
and available quoted market prices, where
applicable. All methods of assessing fair value
result in general approximation of value, and such
value may never actually be realised.
Financial instruments by category are separately
disclosed indicating carrying value and fair value
of financial assets and liabilities. For financial
assets and liabilities maturing within one year
from the Balance Sheet date and which are
not carried at fair value, the carrying amounts
approximate fair value due to the short maturity of
these instruments.
J. Cash Flow hedges
The Company defines the risk management
objective and strategy for undertaking the
hedge. The Company also defines the economic
relationship between the hedged item and the
hedging instrument, including whether the
changes in cash flows of the hedged item and
hedging instrument are expected to offset each
other.
The Company is exposed to foreign exchange
risk arising from foreign currency transactions,
primarily with respect to US $. Foreign exchange
risk arises from future commercial transactions
and recognised assets and liabilities denominated
in a currency that is not the Company’s functional
currency (').
The risk is measured through a forecast of
highly probable foreign currency cash flows. The
objective of the hedges is to minimise the volatility
of the ' cash flows of highly probable forecast
transactions. The Company risk management
policy is to hedge forecasted foreign currency net
sales for the subsequent 12 to 36 months. As per
the risk management policy, appropriate foreign
currency hedges are executed or undertaken to
hedge forecasted net sales.
When a derivative is designated as a cash flow
hedging instrument, the effective portion of
changes in the fair value of the derivative is
recognised in OCI and accumulated in other
equity. If a hedge no longer meets the criteria for
hedge accounting or the hedging instrument is
sold, expires, is terminated or is exercised, then
hedge accounting is discontinued prospectively.
When hedge accounting for cash flow hedges
is discontinued, the amount that has been
accumulated in other equity remains there until it
is reclassified to profit or loss in the same period
or periods as the hedged expected future cash
flows affect profit or loss. If the hedged future
cash flows are no longer expected to occur, then
the amounts that have been accumulated in
other equity are immediately reclassified to the
statement of profit and loss.
Where a derivative is not designated as a hedge,
or where hedge effectiveness cannot be reliably
established, it is measured at fair value through
profit or loss. Forward contracts are valued using
observable forward exchange rates discounted at
MIFOR (Level 2); the target-redemption forward
is valued using a simulation-based option-pricing
model that reflects its path-dependent strike,
knock-in barrier and target-redemption features,
and is classified within Level 3 of the fair-value
hierarchy
a Due to the short nature of credit period given to customers, there is no financing component in the contract.
b The Company assesses at each reporting date whether a financial asset or a group of financial assets is impaired.
Ind AS 109 requires expected credit losses to be measured through a loss allowance. The Company recognises
lifetime expected losses for all contract assets and / or all trade receivables that do not constitute a financing
transaction. In determining the allowance for expected credit losses, the Company has used a practical expedient by
computing the expected credit loss allowance for trade receivables based on a provision The provision matrix takes
into account historical credit loss experience and is adjusted for forward looking information.
Nature and Purpose of Reserves
Security Premium:
Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes
such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.
Capital Redemption Reserve :
This reserve comprises of amount on Equity share cancellation on account of Scheme of arrangement on Demerger. This
reserve can be utilised in accordance with the provision of section 69 of the Companies Act, 2013
General Reserve :
Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a
specified percentage in accordance with applicable regulations adjusted by utilisation of reserve in accordance with
companies act in earlier years before demerger. The requirement to mandatory transfer a specified percentage of the net
profit to general reserve before declaration of dividend has been withdrawn. However, the amount previously transferred
to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.
Retained Earning :
Retained earning are the profits that the Company has earned till date, less any transfers to general reserve, any transfers
from or to other comprehensive income, dividends or other distributions paid to shareholders.
Employee Stock Option Plan Reserve :
The share options outstanding account is used to record the fair value of equity-settled, share-based payment transactions
with employees. The amounts recorded in share options outstanding account are transferred to securities premium, upon
exercise of stock options, and transferred to general reserve on account of stock options not exercised by employees.
Equity instruments through Other Comprehensive Income :
The Company has opted to recognise changes in the fair value of certain investments in equity securities in other
comprehensive income. These changes are accumulated within the FVTOCI equity instruments reserve within equity.
The Company transfers amounts from this reserve to retained earnings when the relevant equity securities are
derecognised.
Other Comprehensive Income - Cash Flow Hedge
For the forward contracts designated as cash flow hedges, the effective portion of the fair value of forward contracts
are recognised in cash flow hedging reserve under other equity. Upon de-recognition, amounts accumulated in other
comprehensive income are taken to profit or loss at the same time as the related cash flow
notes:
1 As at 31st March, 2026, ' 45,694.35 lakhs (31st March, 2025: ' 29,129.95 Lakhs) of the total outstanding borrowings
were secured by a first charge on current assets and second charge of movable fixed assets.
were secured by a first pari passu charge on the stock of raw materials, finished goods, stock in process, consumable
stores and book debts of the Company. These credit facilities carry average interest rates in the range of 7.00% to
8.00% p.a. (PY: 7.00% to 8.00% p.a.).
2 The Company does not have any charges which are yet to be registered with ROC beyond the statutory period except
for working capital of ' 75 Crores
3 In respect of working capital borrowings from banks timely stock statements are submitted to the banks
The Company has been sanctioned working capital facilities from banks on the basis of security of current assets.
The quarterly returns / statements of current assets (comprising stock and book debts) filed by the Company with the
said banks are not wholly in agreement with the books of account. A summary of the reconciliation of the differences,
together with the reasons therefor, is given below.
The Company did submit revised stock statements to all banks after accounts finalisation for the respective reporting
periods.
(a) Stock: The differences arise from the basis on which the statements filed with the banks are compiled and
comprise principally the effect of the measurement requirements applicable to inventories, adjustments to the
carrying value of inventories determined on completion of the valuation exercise for the respective quarter, and
the effect of revenue cut-off adjustments, consequent to which goods dispatched in the vicinity of the quarter
end were considered as part of closing inventory in the books of account.
(b) Book debts: The differences arise from the basis on which the statements filed with the banks are compiled and
comprise principally the effect of the measurement and classification requirements under Ind AS 115, customer
advances and credit balances that are set off in the books of account, allowances for expected credit losses,
and regroupings and adjustments recorded on completion of the periodic closing procedures for the respective
quarter
4 The Company has not been declared as a wilful defaulter by any bank or financial institution or other lender in
accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India.
5 Working-capital demand loans and packing credit interest at rates fixed for the tenor of each drawdown and are
classified as fixed-rate borrowing; the cash-credit facility (' 21.96 Lakhs) is benchmark-linked. The Company’s
floating-rate interest exposure arises from the External Commercial Borrowing and FCNR loan, on which the interest-
rate sensitivity above is computed
Term loans from banks comprise:
a A term loan of ' 100 Crores from Citibank N.A., sanctioned in two tranches - ' 70 Crores for the Atali project
capex and ' 30 Crores for the solar power project capex - each with a six-year door-to-door tenor and a two-year
moratorium, availed as a foreign-currency (FCNR) loan; carrying amount ' 11,488.88 Lakhs, bearing interest at
the bank’s applicable rate (floating, with monthly rests); and
b An External Commercial Borrowing of US$ 12 million from Axis Bank, carrying amount ' 11,380.20 Lakhs,
bearing interest at SOFR plus 1.40% per annum and repayable in 16 equal quarterly instalments of US$ 0.75
million from August 2026 to May 2030.
Both facilities are secured by a first pari-passu charge on the Company’s movable fixed assets and a second
pari-passu charge on current assets.
C The Company has complied with all applicable covenants as at and for the year ended 31st March 2026.
Footnotes:
(a) Disaggregate revenue information
Refer Note 36 for disaggregated revenue information. The management determines that the segment information
reported is sufficient to meet the disclosure objective with respect to disaggregation of revenue under Ind AS 115
"Revenue from contracts with customers".
(b) In case of Domestic Sales, payment terms range from 60 days to 120 days based on geography and customers. In
case of Export Sales these are either against documents at sight, documents against acceptance or letters of credit
- 60 days to 120 days. There is no significant financing component in any transaction with the customers.
A Post-employment benefits
(i) Provident Fund (defined contribution plan)
The Company has certain defined contribution plans. Contributions are made to provident fund 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 are
' 899.87 Lakhs (PY ' 695.29 Lakhs).
(ii) Retirement Gratuity (defined benefit plans)
The Company provides for gratuity for employees 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 by number of years of service. The gratuity plan is a funded plan and the Company makes contributions
to recognised funds in India. The Company maintains a target level of funding to be maintained over a period of time
based on estimations of expected gratuity payments.
The Company operates a funded defined benefit gratuity plan; it is a final-salary plan with contributions made to a
separately administered fund managed by LIC,
During the year, a change in the eligible salary arising from the new labour codes resulted in a plan amendment; the
resulting increase in the obligation of ' 189.10 Lakhs has been recognised as past service cost as on 21st November,
2025 (measured using a discount rate of 6.94%).
DefinedbenefitplanstypicaMyexposetheCompanytoactuarialriskssuchas:InvestmentRisk,InterestRisk,Longevity
Risk and Salary Risk.
(i) Investment risk:
The present value of the defined benefit plan liability is calculated using a discount rate determined by reference
to government bond yields. If the return on plan asset is below this rate, it will create a plan deficit.
(ii) Interest risk:
A decrease in the bond interest rate will increase the plan liability. However, this will be partially offset by an
increase in the value of plan’s debt investments.
(iii) Salary risk:
The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan
participants. As such, an increase in salary of the plan participants will increase the plan’s liability.
(iv) 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.
(v) Asset-liability matching risk:
The plan invests in line with Rule 101 of the Income Tax Rules, 1962. Concentration risk: the plan assets are held
with a single insurer, so a default would affect all assets, although this probability is low
B Details of defined benefit obligations and plan assets (Gratuity)
The amounts recognised in the balance sheet and the movements in the net defined benefit obligation over the year are
as follows :
Notes:
(i) The sensitivity analysis have been determined based on reasonably possible changes of the respective assumptions
occurring at the end of the reporting period, while holding all other assumptions constant.
(ii) The sensitivity analysis presented above may not be representative of the actual change in the projected benefit
obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the
assumptions may be correlated.
(iii) Furthermore, in presenting the above sensitivity analysis, the present value of the projected benefit obligation has
been calculated using the projected unit credit method at the end of the reporting period, which is the same method
as applied in calculating the projected benefit obligation as recognised in the balance sheet.
(iv) There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.
(v) The Company is expected to contribute ' 651.67 Lakhs to defined benefit plan obligations funds for the year ended
31st March, 2027.
(vi) Expected return on assets is determined by multiplying the opening fair value of the plan assets by the expected rate
of return determined at the start of the annual reporting period, taking account of expected contributions & expected
settlements during the reporting period.
(vii) The Weighted Average Duration of the Plan works out to 9 years.
(viii) Asset Liability matching strategy:
The money contributed by the Company to the Gratuity fund to finance the liabilities of the plan has to be invested.
The trustees of the plan have outsourced the investment management of the fund to an insurance Company. The
insurance Company in turn manages these funds as per the mandate provided to them by the trustees and the asset
allocation which is within the permissible limits prescribed in the insurance regulations.
Due to the restrictions in the type of investments that can be held by the fund, it is not possible to explicitly follow an
asset liability matching strategy. There is no compulsion on the part of the Company to fully prefund the liability of
the Plan.
(b) Corporate Social Responsibility
As per provisions of section 135 of the Companies Act, 2013, the Company has to incur at least 2% of average net
profits of the preceding three financial years towards Corporate Social Responsibility ("CSR"). Accordingly, a CSR
committee has been formed for carrying out CSR activities as per the Schedule VII of the Companies Act, 2013.
Details are as under:
Nature of CSR activities for the year ended 31st March, 2026 and 31st March, 2025:
Promoting education and women empowerment, preventive healthcare, supporting sports activities in rural areas of
country, promoting hygiene sanitation practices, supporting clean and pollution free environment, for renovation of school,
and for other activities as prescribed under Schedule VII of The Companies Act, 2013.
(a) Basic EPS is calculated by dividing profit for the year attributable to equity shareholders of the Company by the
weighted average number of Equity shares outstanding during the year.
(b) Diluted EPS amounts are calculated by dividing the profit attributable to equity shareholders of the Company by the
weighted average number of Equity shares outstanding during the year plus the weighted average number of Equity
shares that would be issued on conversion of all the dilutive potential Equity shares into Equity shares.
(c) Number of Shares for Computation of EPS
34 SHARE BASED PAYMENTS
a Scheme details
The Company has Employees’ Stock Option Scheme i.e. PSOP under which options have been granted at the exercise
price of ' 5 per share to be vested from time to time on the basis of performance and other eligibility criteria. Details of
number of options outstanding have been tabulated below:
b Fair Value on the grant date
The fair value at grant date is determined using "Black Scholes Model" which takes into account the exercise price, term
of the option, share price at grant date and expected price volatility of the underlying shares, expected dividend yield and
the risk free interest rate for the term of the option.
Scheme description -
The Employees' Stock Option Scheme is an equity-settled plan. Options are granted at an exercise price of ' 5 and vest in
a graded manner over three years subject to continued service; the exercise period commences on vesting andruns upto
a Maximum period of 7 years from the date of respective grant of Options Each option, on exercise, entitles the holder to
one equity share of face value ' 5.
Effect on profit or loss
Total expense recognised during the year for equity-settled share-based payment transactions: ' 247.60 Lakhs (previous
year: ' 193.45 Lakhs), included in employee benefits expense and credited to the Employee Stock Option Plan reserve
(Note 15(e)). There are no cash-settled share-based payment transactions, and accordingly no liability.
Exercise-price range & remaining life
Weighted average share price at the date(s) of exercise (23,127 options exercised): Rs 706. Options outstanding at
31st March 2026: range of exercise prices Rs 5 (single price); weighted average remaining contractual life 3 years (PSOP
1 / 2 / 3: 1 / 2 / 3 years).
36 SEGMENT INFORMATION
The operating segments have been reported in a manner consistent with the internal reporting provided to the Board
of Directors, who are the Chief Operating Decision Makers (CODM). The board responsible for allocating resources
and assessing the performance of operating segments. Accordingly, the reportable segment is only one segment i.e.
Pharmacuticals.
(a) Revenue from Type of Product and Services
There is only one operating segment of the Company which is based on nature of product. Hence the revenue from
external customers shown under geographical information is representative of revenue based on product and services.
Fair value hierarchy
Level 1 : Hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments
and mutual funds that have quoted price. The mutual funds are valued using the closing NAV.
Level 2 : The fair value of financial instruments that are not traded in an active market is determined using valuation
techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates.
If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3 : If one or more of the significant inputs is not based on observable market data, the instrument is included in
level 3. This is the case for unlisted equity securities, listed redeemable preference shares for which sufficient observable
market data was not available during the year, etc. included in level 3.
This section explains the judgements and estimates made in determining the fair values of the financial instruments
that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are
disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair
value, the group has classified its financial instruments into the three levels prescribed under the accounting standard. An
explanation of each level followed is given in the table above
40 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company’s Board of Directors has overall responsibility for the establishment and oversight of the Company’s
Risk Management framework. The Board has established the Risk Management Committee, which is responsible for
developing and monitoring the Company’s Risk Management policies. The Committee reports regularly to the Board of
Directors on its activities.
The Company’s financial assets comprise mainly of investments, cash and cash equivalents, other balances with banks,
trade receivables and other receivables and financial liabilities comprise mainly of borrowings, trade payables and other
payables
The Company’s activities expose it to market risk, liquidity risk and credit risk. The Company’s overall risk management
focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial
performance of the Company. The Company uses derivative financial instruments, such as cross currency swaps and
interest rate swaps to hedge foreign currency risk and interest rate risk exposure. Derivatives are used exclusively for
hedging purposes and not as trading or speculative instruments.
A Market Risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes
in market prices. Market risk comprises three types of risks: interest rate risk, currency risk and other price risk. Financial
instruments affected by market risk include borrowings, investments, trade payables, trade receivables and derivative
financial instruments.
(i) Interest rate risk
Interest rate risk is the risk that the fair value of future cash flows of the financial instruments will fluctuate due to
changes in market interest rates. Company’s interest rate risk arises from borrowings.
The following table demonstrates the sensitivity on the Company’s profit before tax, to a reasonably possible change
in interest rates of variable rate borrowings on that portion of loans and borrowings affected, with all other variables
held constant:
(ii) 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 transacts in several currencies and consequently the Company is
exposed to foreign exchange risk through its sales outside India, and purchases from overseas suppliers in various
foreign currencies. The Company also has borrowings in foregin currency. The exchange rate between the Indian
rupee and foreign currencies has changed substantially in recent years and may fluctuate substantially in the future.
Consequently, the results of the Company’s operations are affected as the rupee appreciates / depreciates against
these currencies. Foreign currency exchange rate exposure is partly balanced by purchase of raw materials and
services in the respective currencies.
As at the end of the reporting period, the carrying amounts of the foreign currency denominated monetary assets and
liabilities set out below, translated at the closing exchange rate of ' 94.835 per US$. Derivative financial instruments
are excluded and are disclosed separately in (b) below:
Foreign Currency Risk Sensitivity
The following table sets out the effect of a 0.5% increase / (decrease) in the exchange rate of each foreign currency
against the Indian Rupee at the reporting date, with all other variables held constant, on profit before tax. The analysis
is applied to the net recognised monetary items set out in (a) above and excludes the effect of changes in the fair
value of derivative financial instruments
The Company uses forward exchange contracts to hedge foreign-exchange exposures on underlying transactions
and firm commitments and does not enter into derivatives for trading or speculation. Outstanding forward contracts
hedge US$ 77 Lakhs of highly probable forecast exports (previous year: US$ 101 Lakhs).
Hedge accounting (Ind AS 107.22A-24B). The forward contracts are designated as cash-flow hedges of highly
probable forecast US$ sales; an economic relationship exists (critical terms substantially match) and is assessed by
the dollar-offset method with a ±5% spot shock, giving a hedge ratio of 1:1 and a prospectively effective hedge. The
hedging instruments (US$ 7,700,000, maturing within one year) have a carrying value of ' (498.12) Lakhs; the effective
portion is deferred in the Cash Flow Hedge Reserve (Note 15(g)) and ineffectiveness recognised in profit or loss is
' Nil.
Derivative not designated as a hedge (FVTPL): the US$/' target-redemption forward with Standard Chartered Bank
- notional US$ 23,287,500 (' 22,084.70 Lakhs), fair value ' (2,972.94) Lakhs, a Level 3 measurement.
The target-redemption forward is not hedge-accounted; its notional amount is disclosed in (b) above for information
only. The notional is not a monetary asset or liability of the Company; the Company’s exposure arising from the
instrument is reflected in its fair value, which is recognised in the Statement of Profit and Loss. Contractual maturities
of the notional are US$ 58.50 Lakhs / ' 5,547.85 Lakhs within one year and US$ 174.375 Lakhs / ' 16,536.85 Lakhs
between one and five years, with final settlement in March 2030
(B) 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 from its operating activities, primarily for trade receivables
and deposits with banks and other financial assets. The Company ensures that sales of products are made to customers
with appropriate creditworthiness. Outstanding customer receivables are regularly monitored by the management. An
impairment analysis is performed at each reporting date on an individual basis for major customers. Credit risk on cash
and cash equivalents is limited as the Company generally invest in deposits with banks.
Refer footnotes c and d below note no.10 for ageing of trade receivables and movement in credit loss allowance.
(C) Liquidity Risk
Liquidity risk is the risk that the Company may not be able to meet its financial obligations without incurring unacceptable
losses. The objective of liquidity risk management is to maintain sufficient liquidity and ensure that funds are available for
use as per requirements. The Company has obtained fund and non-fund based limit from various banks. Furthermore, the
Company has access to undrawn lines of committed borrowing/facilities. The Company consistently generates sufficient
cash flows from operations or from cash and cash equivalents to meet its financial obligations including lease liabilities
as and when they fall due.
(D) Capital Management
For the purpose of the Company’s capital management, capital includes issued equity capital, and all other equity reserves
attributable to the equity shareholders. The primary objective of the Company’s capital management is to maximise the
shareholder value, safeguard business continuity and support the growth of the Company. The Company manages its
capital structure and makes suitable adjustments in light of changes in economic conditions.
41 OTHER DISCLOSURES
(a) Details of Benami Property Held
The Company does not hold any benami property as defined under the Benami Transactions (Prohibition) Act, 1988 (45 of
1988) and the rules made thereunder. No proceeding has been initiated or pending against the Company for holding any
benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.
(b) Relationship With Struck off Companies
The Company has no transactions/balance with struck off companies under Section 248 of the Companies Act, 2013 or
Section 560 of Companies Act, 1956
(c) Willful Defaulter
The Company has not been declared a willful defaulter by any bank or financial institution or other lender (as defined
under the Companies Act, 2013) or consortium thereof, in accordance with the guidelines on wilful defaulters issued by
the Reserve Bank of India
(d) Registration Of Charges Or Satisfaction With Registrar Of Companies
The Company do not have any charges or satisfaction which is yet to be registered with Registrar of Companies (ROC)
beyond the statutory period except for working capital of ' 75 Cr
(e) Details Of Crypto Currency Or Virtual Currency
The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year
(f) The Company has not advanced or loaned or invested funds to any other person or entity, including foreign entities
(Intermediaries) with the understanding that the Intermediary shall:
(i) 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
(ii) provide any guarantee, security or the like on behalf of the ultimate beneficiaries
(g) 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:
(i) 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
(ii) Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(h) Undisclosed Income
The Company has not had any such transaction which is not recorded in the books of accounts that has been surrendered
or disclosed as income during the year 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).
(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries
(i) Borrowings Obtained on the Basis of Security of Current Assets
For the borrowings secured against current assets, the Company has filed Quarterly statements of current assets with the
banks and are not wholly in agreement with the books of account. Refer Note 16.2 for the reconciliation of differences.
(j) Utilisation of Borrowed Funds and Share Premium
As on 31st March, 2026 there is no unutilised amounts in respect of any issue of securities and long term borrowings from
banks and financial institutions. The borrowed funds have been utilised for the specific purpose for which the funds were
raised.
(k) Revaluation Of Property, Plant And Equipment And Intangible Assets
The Company has not revalued any of its property, plant and equipment (including Right of Use assets) and intangible
assets during the year.
(l) Compliance With Number of Layers of Companies
The Company is in compliance with the number of layers prescribed under clause (87) of section 2 of the Companies Act
read with the Companies (Restriction on number of Layers) Rules, 2017
(m) With effect from 1st April, 2025 the Company migrated its books of account from SAP ECC to SAP S/4HANA Public Cloud, a
Software-as-a-Service platform hosted, configured and operated by SAP SE application-level audit trail (edit log) capturing
the user, date and details of each change remained operational throughout the year for all relevant transactions; a posted
financial document cannot be deleted or modified for data points impacting the financial statements, the feature has not
been tampered with, and it cannot be disabled by users of the Company.
As the platform is a public-cloud SaaS environment, its configuration and database are managed by the service
organisation and users of the Company are not granted database- or super-user-level access. The Company has obtained
an independent service auditor’s [ISAE 3402 / SOC 1] Type 2 report covering the cloud infrastructure and platform controls;
this does not specifically address audit-trail maintenance at the configuration and database levels, which are, by the
architecture of a public-cloud service, not independently verifiable by the Company. Reliance for these layers is placed on
the service organisation and its independent assurance, supplemented by a bridge letter. The Company is obtaining an
application-specific report covering audit-trail maintenance for subsequent periods.
(n) Foreign Exchange Derivative Contract
The Company had entered into a target redemption forward contract during the FY 2024-25 for hedging anticipated US$
export inflows. The contract is a zero-cost derivative with no cash payments during FY 2024-25 and was inadvertently
not included in the fair value calculations made by the Company for that year. The omission was identified during the
preparation of the financial statements for FY 2025-26.
Based on a valuation exercise carried out by an expert, the fair value impact as at 31st March, 2025 of ' 6.02 Crores (' 4.50
Crores net of deferred tax) was not material to the financial statements of FY 2024- 25, and comparative figures have not
been restated.
Since the hedge effectiveness of the contract cannot be reliably established, the contract is measured at Fair Value
Through Profit and Loss (FVTPL). The fair value impact of ' 29.73 Crores (' 22.24 Crores net of deferred tax) has been
recognised in the Statement of Profit and Loss during the year ended 31st March, 2026.
(o) Exceptional Items
On 21st November, 2025, the Government of India notified the four 'Labour Codes - the Code on Wages, 2019, the Industrial
Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions
Code, 2020 - consolidating 29 existing labour laws. The Ministry of Labour & Employment published draft Central Rules
and FAQs to enable assessment of the financial impact due to changes in regulations. The Company has assessed
gratuity liability and has disclosed the incremental impact of these changes of ' 279 Lakhs (Gratuity ' 189 Lakhs and
leave salary ' 90 Lakhs) on the basis of information available, consistent with the guidance provided by the Institute of
Chartered Accountants of India. Considering the materiality and regulatory-driven, non-recurring nature of this impact,
the Company has presented such incremental impact under "Exceptional item" in the Standalone Statement of Profit and
Loss for the year ended 31st March, 2026.
Said incremental impact primarily arises due to change in wage definition. The Company continues to monitor the
finalisation of Central / State Rules and clarifications from the Government on other aspects of the Labour Code and
would provide appropriate accounting effect based on such developments as needed.
(p) Events after the reporting period
Events after the reporting period are those events, favourable and unfavourable, that occur between the end of the reporting
period and the date when the financial statements are approved by the Board of Directors in case of a company, and, by
the corresponding approving authority in case of any other entity for issue. Two types of events can be identified:
(i) those that provide evidence of conditions that existed at the end of the reporting period (adjusting events after the
reporting period); and
(ii) those that are indicative of conditions that arose after the reporting period (non-adjusting events after the reporting
period).
As on 25th May, 2026 there were no material subsequent events to be recognised or reported that are not already disclosed.
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