Provision is made for the amount of any final dividend declared, being appropriately authorised in the Annual General
Meeting and no longer at the discretion of the Company,

Interim Dividends are recorded as a liability on the date of declaration by the Company's Board of Directors,

XIV) Leases

Ind AS 116 supersedes Ind AS 17 Leases including its appendices. The standard sets out the principles for the recognition,
measurement, presentation and disclosure of leases and requires lessees to recognise most leases on the balance sheet.

The Company has adopted Ind AS 116 using the modified retrospective method of adoption underthe transitional
provisions of the Standards, with the date of initial application on 1st April 2019. The Company also elected to use the
recognition exemptions for lease contracts that, at the commencement date, have a lease term of 12 months or less and
do not contain a purchase option (short-term leases), and lease contracts for which the underlying asset is of Sow value
(low-value assets).

The Company assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the
right to control the use of an identified asset for a period of time in exchange for consideration.

Company as a lessee

The Company applies a single recognition and measurement approach for all leases, except for short-term leases and
leases of low-value assets. The Company recognises lease liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.

Right-of-use assets

The Company recognises right-of-use assets at the commencement date of the lease (i.e,, the date the underlying asset is
available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses
and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease
liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less
any lease incentives received, Right of use assets are depreciated on a straight-line basis over the shorter of the lease
term and the estimated useful lives of the assets.

if ownership of the leased asset transfers to the Company at the end of the lease term or the cost reflects the exercise of
a purchase option, depreciation is calculated using the estimated useful life of the asset,

The right-of-use assets are also subject to impairment. Refer to the accounting policies in section (k) Impairment of non-
finandal assets.

Lease Liabilities

At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease
payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed
payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees.

In calculating the present value of lease payments, the Company uses its incremental borrowing rate at the lease
commencement date because the interest rate implicit in the lease is not readily determinable. After the commencement
date, the amount of lease liabilities fs increased to reflect the accretion of interest and reduced for the lease payments
made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change In the lease
term, a change in the lease payments (e.g,, changes to future payments resulting from a change in an index or rate used

to determine such lease payments) or a crtange in tne assessment ot an option to purchase tne underlying asset.
Short-term leases and leases of low-value assets

The Company applies the short-term lease recognition exemption to its short-term leases of machinery and equipment
(i.e,, those leases that have a lease term of 12 months or less from the commencement date and do not contain a
purchase option), it also applies the lease of low-value assets recognition exemption to leases of offices, godowns,
equipment, etc. that are of low value. Lease payments on short-term leases and leases of low-value assets are recognised
as expense on a straight-line basis over the lease term.

Company as a lessor

Lessor accounting under Ind AS 116 is substantially unchanged from Ind AS 17. Lessors will continue to classify leases as
either operating or finance leases using similar principles as in Ind AS 17. Therefore, Ind AS 116 does not have an impact
for leases where the Company is the lessor.

Leases in which the Company does not transfer substantially all the risks and rewards incidental to ownership of an asset
are classified as operating leases, Rental income arising is accounted for on a straight-line basis over the lease terms.
Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the
leased asset and recognised over the lease term on the same basis as rental income. Contingent rents are recognised as
revenue in the period in which they are earned.

XV) Impairment of non-financial assets

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any
indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset's
recoverable amount. An asset's recoverable amount is the higher of an asset's or cash-generating unit's (CGU) fair value
less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does
not generate cash inflows that are largely independent of those from other assets or group of assets. When the carrying
amount of an asset or CGU exceeds its recoverable amount, the asset is considered Impaired and is written down to its
recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset.

The Company bases its impairment calculation on forecast calculations, which are prepared separately for each of the
Company's CGUs to which the individual assets are allocated,

Impairment losses of continuing operations, including impairment on inventories, are recognised in the statement of
profit and loss,

An assessment is made at each reporting date to determine whether there is an indication that previously recognised
impairment losses no longer exist or have decreased, If such indication exists, the Company estimates the asset's or
CGU's recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the
assumptions used to determine the asset's recoverable amount since the last impairment loss was recognised. The
reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the
carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the
asset in prior years, Such reversal is recognised in the statement of profit or loss.

XVI) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker.
Revenue and expenses are identified to segments on the basis of their relationship to the operating activities of the segment.
Revenue, expenses, assets and liabilities which are not allocable to segments on a reasonable basis, are included under "Unallocated
revenue/ expenses/ assets/ liabilities".

The analysis of geographical segments is based on the areas in which customers of the Company are located.

Segment accounting policies are in line with the accounting policies of the Company, In addition, the following specific accounting
policies have been followed for segment reporting:

i) Segment revenue includes sales and other operational revenue directly identifiable with/allocable to the segment including inter
segment revenue.

ii) Expenses that are directly identifiable with/allocable to segments are considered for determining the segment result.

iii) Most of the centrally incurred costs are allocated to segments mainly on the basis of their respective expected segment revenue
estimated at the beginning of the reported period,

iv) income which relates to the Company as a whole and not allocable to segments is included in "unallocable corporate income/
(expenditure)(net)".

v) Segment result includes margins on inter-segment capital jabs, which are reduced in arriving at the profit before tax of the
Company.

vi) Segment result includes the finance costs incurred on interest bearing advances with corresponding credit included In "unallocable
corporate incom e/(expe nditure) (net),

vli) Segment results have not been adjusted for the exceptional item attributable to the corresponding segment, The said exceptional
item has been Included in "unallocable corporate income/(expenditure)[net)“. The corresponding segment assets have been carried
under the respective segments without adjusting the exceptional item.

viii} Segment revenue resulting from transactions with other business segments is accounted on the basis of transfer price which are
either determined to yield a desired margin or agreed on a negotiated basis,

ix) Segment assets and liabilities include those directly identifiable with the respective segments. Unallocable corporate assets and
liabilities represent the assets and liabilities that relate to the Company as a whole,

x} Segment non-cash expenses forming part of segment expenses includes the fair value of the employee stock options which is
accounted as employee compensation cost [Note l(r) supra] and is allocated to the segment,

XVII) Business combination

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the
aggregate ofthe consideration transferred measured at acquisition date fairvalue andthe amount of any noncontrolling
interests in the acquiree. For each business combination, the Company elects whether to measure the noncontrolling
interests in the acquiree at fairvalue or at the proportionate share ofthe acquiree's identifiable net assets. Acquisition-
related costs are expensed as incurred, At the acquisition date, the identifiable assets acquired andthe liabilities assumed
are recognised at their acquisition date fair values. Ý

Any business combinations involving entities or businesses under common control are accounted for using the pooling of
interest method:

• The assets and liabilities of the combining entities are reflected at their carrying amounts.

• Mo adjustments are made to reflect fair values, or recognise any new assets or liabilities. The only adjustments that are
made are to harmonise accounting policies.