2.13 Provisions
Provisions are recognized when the Company has a
present obligation (Legal or constructive) as a result
of a past event and it is probable that an outflow
of resources embodying economic benefits will
be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best
estimate of the consideration required to settle
the present obligation at the end of the reporting
period, taking into account the risks and uncertainties
surrounding the obligation. When a provision is
measured using the cash flows estimated to settle the
present obligation, its carrying amount is the present
value of those cash flows (when the effect of the time
value of money is material).
2.14 Financial Assets and Financial Liabilities
Financial assets and financial liabilities are recognised
when the Company becomes a party to the contractual
provisions of the instruments. Financial assets and
financial liabilities are initially measured at fair value.
Transaction costs that are directly attributable to the
acquisition or issue of financial assets and financial
liabilities (other than financial assets and financial
liabilities at fair value through profit or loss) are added
to or deducted from the fair value of the financial
assets or financial liabilities, as appropriate, on initial
recognition. Transaction costs directly attributable to
the acquisition of financial assets or financial liabilities
at fair value through profit or loss are recognised
immediately in statement of profit and loss.
2.15 Financial Assets
AH regular way purchases or sales of financial assets
are recognised and de-recognised on a trade date
basis. Regular way purchases or sales are purchases or
sales of financial assets that require delivery of assets
within the time frame established by regulation or
convention in the market place.
AH recognised financial assets are subsequently
measured in their entirety at either amortised cost
or fair value, depending on the classification of the
financial assets.
2.15.1 Financial assets at amortised cost
Financial assets are subsequently measured at
amortised cost if these financial assets are held
within a business whose objective is to hold
these assets in order to collect contractual cash
flows and the contractual terms of the financial
asset give rise on specified dates to cash flows
that are solely payments of principal and
interest on the principal amount outstanding.
2.15.2 Financial assets at fair value through other
comprehensive income
A financial asset is subsequently measured at fair
value through other comprehensive income 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 are
solely payments of principal and interest on the
principal amount outstanding.
On initial recognition, the Company makes
an irrevocable election on an instrument-by¬
instrument basis to present the subsequent
changes in fair value in other comprehensive
income pertaining to investments in equity
instruments, other than equity investment
which are held for trading. Subsequently, they
are measured at fair value with gains and losses
arising from changes in fair value recognised in
other comprehensive income and accumulated
in the 'Reserve for equity instruments through
other comprehensive income'. The cumulative
gain or loss is not reclassified to profit or loss on
disposal of the investments.
2.15.3 Financial assets at fair value through profit
or loss (FVTPL)
Investments in equity instruments are classified
as at FVTPL, unless the Company irrevocably
elects on initial recognition to present
subsequent changes in fair value in other
comprehensive income for investments in equity
instruments which are not held for trading.
Other financial assets are measured at fair value
through profit or loss unless it is measured at
amortised cost or at fair value through other
comprehensive income on initial recognition.
The transaction costs directly attributable
to the acquisition of financial assets and
liabilities at fair value through profit or loss are
immediately recognised in profit or loss.
2.15.4 Investment in Joint Ventures and Associate
Investment in joint Ventures and Associate are
measured and stated at cost less impairment as
per Ind AS 27 - Separate Financial Statements.
2.15.5 Impairment of financial assets (other than
financial assets at fair value)
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
impairment loss on account receivable and
other financial assets to be measured through
a impairment loss. The Company recognizes
life-time impairment loss for all trade receivables
that do not constitute a financing transaction.
For all other financial assets, impairment loss is
measured at an amount equal to the 12 month
impairment losses or at an amount equal to the
life-time impairment losses if the credit risk on
the financial asset has increased significantly
since initial recognition. Also, refer note 12.1 on
impairment loss on Trade receivable.
2.16 Financial liabilities and equity instruments
2.16.1 Classification as debt or equity
Debt and equity instruments issued by a
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.
2.16.2 Equity Instruments
An equity instrument is any contract that
evidences a residual interest in the assets of
an entity after deducting all of its liabilities.
Equity instruments issued by a Company are
recognised at the proceeds received, net of
direct issue costs.
Repurchase of the Company's own equity
instruments is recognised and deducted
directly in equity. No gain or loss is recognized
in statement of profit and loss on the purchase,
sale, issue or cancellation of the Company's
own equity instruments.
2.16.3 Financial liabilities
All financial liabilities are subsequently
measured at amortised cost using the effective
interest method.
2.17 Derivative financial instruments
The Company enters into a variety of derivative
financial instruments to manage its exposure to
foreign exchange rate risks, including foreign
exchange forward contracts.
Derivatives are initially recognized at fair value at the
date the derivative contracts are entered into and are
subsequently remeasured to their fair value at the
end of each reporting period. The resulting gain or
loss is recognized in profit or loss immediately.
2.18 Cash and Cash Equivalents
Cash and cash equivalent in the balance sheet
comprise cash at banks and on hand and short-term
deposits with an original maturity of three months
or less, which are subject to an insignificant risk of
changes in value.
For the purpose of the statement of cash flows, cash
and cash equivalents consist of cash and short-term
deposits, as defined above, net of outstanding bank
overdrafts as they are considered an integral part of
the Company's cash management.
2.19 Impairment of assets
Assets are tested for impairment whenever changes in
circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised
for the amount by which the assets carrying amount
exceeds its recoverable amount. The recoverable
amount is the higher of an asset's fair value less costs
of disposal and value in used. For the purposes of
assessing impairment, assets are grouped at the lower
levels for which there are separately identifiable
cash inflows which are largely independent of the
cash inflows from other assets or groups of assets
(cash-generating units). Non-financial assets other
than goodwill that suffered an impairment are
reviewed for possible reversals of the impairment at
the end of each reporting period.
2.20 Recent accounting pronouncements
Amendments to Standards issued but not yet effective:
The Ministry of Corporate Affairs (MCA), vide
notification G.S.R. 291(E) dated May 7, 2025, has
amended Ind AS 21 The Effects of Changes in Foreign
Exchange Rates to provide guidance on accounting for
situations where exchangeability between currencies
is lacking. The amendment is applicable for annual
reporting periods beginning on or after April 1, 2025.
The amendment sets out criteria for assessing
whether a currency is exchangeable and, where it
is not, prescribes how an entity should estimate
the spot exchange rate. The amendment also
requires disclosures to enable users of the financial
statements to understand the impact of any such lack
of exchangeability on the entity's financial position,
performance, and cash flows.
The Company does not expect these amendments
to have a material impact on its operations or
financial statements.
Note 6.2 :Disclosure as per Ind-AS 36, on Impairment of Investments in Joint Venture
The Company's investment in Finolex J Power Systems Limited, (FJPS) is long term and strategic in nature. FJPS is engaged
in manufacturing and sale of extra high voltage power cables. The operations of FJPS continued to be adversely impacted
by economic slowdown and has continued to incur losses, resulting in its net worth being partially eroded. The management
expects improvement in operations of FJPS upon revival of the economic environment and along with the Joint Venture
partner, continues to support FJPS operations by infusion of equity as required.
Considering above, the Company had in accordance with Ind AS - 36 "Impairment of Assets" carried out impairment
assessment of its investment in FJPS by comparing its recoverable amount (enterprise value) with its carrying amount as at
31st March, 2025.
The recoverable amount of the investment in FJPS is assessed based on future discounted cash flows of FJPS (enterprise value).
Note 12.1
Trade Receivables :
The average credit period for the Company's receivables is generally in the range of 0 to 90 days in respect of institutional
sales and up to 180 days in case of sales to specific customers, including government owned entities. No interest is charged
on trade receivables. Trade receivables balance as at 31st March 2025 includes ' 25.43 crores from Telecommunication
Consultants India Limited (31st March 2024 included ' 30.31 crores), '152.54 crores due from Minda Corporation Ltd, Bharati
Airtel, Fort Gloster Industries Pvt Ltd, Aptive Components India Private Limited (31st March, 2024 included ' 108.45 crores
due from Minda Corporation Limited, Bharti Airtel Limited and D-Link India Limited) which represents Company's large
customers. Apart from the above there are no customers who individually represents more than 5% of the total balance of
trade receivables.
Net Impairment loss/(reversal) on account receivable
For trade receivables, the Company applies a simplified approach in calculating impairment loss on account receivable.
Therefore, the Company does not track changes in credit risk, but instead recognises a loss allowance based on lifetime
impairment at each reporting date. The Company has established a provision matrix that is based on its historical credit loss
experience, adjusted for forward-looking factors specific to the debtors and the economic environment.
Nature and purpose :
Securities Premium :
Securities Premium is used to record the premium on issue of shares and is utilised in accordance with the provisions of the
Companies Act, 2013.
Capital Reserve
The Company recognises the difference on purchase, sale, issue or cancellation of Company's own equity instruments to
Capital Reserve. Capital Reserve is utilised in accordance with the provisions of the Companies Act, 2013.
General Reserve:
General Reserve is used from time to time to transfer profits from Retained Earnings for appropriation purposes. As the
general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive
income, items included in the General Reserve will not be reclassified subsequently to statement of profit and loss.
Share buy back reserve
During the earlier years, the Company had bought back its own equity out of free reserves. Share buy back reserve (Capital
Redemption Reserve) represents amount set-aside in respect of nominal value of the shares bought back as per the
Companies Act, 2013.
Retained Earnings:
Retained Earnings are the profits of the Company earned till date net of appropriations.
Equity Instruments through Other Comprehensive Income
This Reserve represents the cumulative gains and losses arising on revaluation of equity instruments measured at fair value
through Other Comprehensive Income, net of amounts reclassified to retained earnings when those assets are disposed off.
ii Other Commitment
(a) In respect of Finoiex J Power Systems Limited (FJPS), Joint Venture of the Company whose net worth has been
substantially eroded, the Company along with its joint venture partner has provided unconditional financial
support.
NOTE 33 :EMPLOYEE BENEFIT PLAN
33.1 Defined Contribution plan
The Company makes Provident Fund and Superannuation Fund contributions to defined contribution retirement benefit
plans for eligible employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll
costs to fund the benefits. The contributions as specified under the law/scheme are paid to the Government administered
Provident fund and in case of Superannuation to the Scheme set up as trust by the Company-Insurer. The Company is liable
only for annual contributions.
The Company has recognised ?6.92 crores (31st March 2024 - ' 6.46 crores) for provident fund contributions.
Contribution for superannuation funds ' Nil (31st March 2024 - ' 2.20 crores) in the Statement of Profit and Loss because the
earlier surplus contribution are available for utilisation.
The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.
33.2 Defined Benefit plan
Gratuity-Funded
The Company has a defined benefit gratuity plan. The gratuity plan is primarily governed by the Payment of Gratuity Act, 1972.
Employees who are in continuous service for a period of five years are eligible for gratuity. The level of benefits provided
depends on the member's length of service and salary at the separation date. The gratuity plan is funded plan. The Company
has formed a trust and is governed by Trustees appointed by the Company. The Trustees are responsible for administration
of the plan assets and investment strategy in accordance with the regulations. The funds are deployed in recognised insurer
managed funds in India.
Risk exposure:
Through the defined benefit plan, the Company is exposed to a number of risks, the most significant of which are
detailed below:
Asset Volatility:
The plan liabilties are calculated using a discount rate set with reference to government bond yield. If plan assets underperform
this yield, it will result in deficit. These are subject to interest rate risk. To offset the risk plan assets have been deployed in
high grade insurer managed funds.
Inflation rate risk:
Higher than expected increase in salary will increase the defined benefit obligation.
Demographic risk:
This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability
and retirement. The effect of these decrements on the defined benefit obligations is not straightforward and depends upon
the combination of salary increase, discount rate and vesting criterion.
1.2. Fair value hierarchy
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either
observable or unobservable and consists of the following three levels:
Level 1 Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. This includes quoted
equity instruments, government securities and mutual funds (includes FMP) that have quoted price.
Level 2 Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly (i.e. as prices) or indirectly (i.e. derived from prices) such as derivative financial instruments.
Level 3 Inputs are not based on observable market data (unobservable inputs). Fair values are determined in whole or
in part using a valuation model based on assumptions that are neither supported by prices from observable
current market transactions in the same instrument nor are they based on available market data. This includes
unquoted equity shares.
(i) Debt is defined as long-term borrowings (including current maturities) and short-term borrowings (excluding
contingent considerations, if any).
(ii) Equity is defined as Equity share capital and other equity including reserves and surplus.
The Company is predominantly equity financed which is evident from the capital structure table. Further, the Company
has always been a cash surplus Company with cash and bank balances along with investment. The Company's investment
is predominantly in liquid and short term mutual funds being far in excess of debt.
3. Financial risk management
The Company is exposed primarily to fluctuations in foreign currency exchange rates, credit, liquidity, which may
adversely impact the fair value of its financial instruments. The Company assesses the unpredictability of the financial
environment and seeks to mitigate potential adverse effects on the financial performance of the Company.
3.1 Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes
in market prices. Such changes in the values of financial instruments may result from changes in the foreign currency
exchange rates, interest rates, credit, liquidity and other market changes. The Company's exposure to market risk is
primarily on account of foreign currency exchange rate risk.
3.1.1 Foreign currency risk management
The fluctuation in foreign currency exchange rates may have potential impact on the statement of profit and loss and
other comprehensive income and equity, where any transaction references more than one currency or where assets /
liabilities are denominated in a currency other than the functional currency of the respective entities. Considering the
countries and economic environment in which the Company operates, its operations are subject to risks arising from
fluctuations in exchange rates in those countries. The risks primarily relate to fluctuations in US Dollar and Euro against
the respective functional currency of the company. The Company enters into derivative financial instruments such as
foreign exchange forward contract to mitigate the risk of changes in exchange rates on foreign currency exposures.
3.1.2 Interest rate risk management
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of
changes in market interest rates. Considering borrowing amount outstanding as at 31st March, 2025 and as at 31st March,
2024 Company is not exposed to significant interest rate risk.
3.2 Credit risk management
Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to the
contractual terms or obligations. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of
creditworthiness as well as concentration of risks. Credit risk is controlled by analysing credit limits and creditworthiness
of customers on a continuous basis to whom the credit has been granted after obtaining necessary approvals for credit.
Financial instruments that are subject to concentrations of credit risk principally consist of trade receivables, investments,
loans, cash and cash equivalents, other balances with banks and other financial assets. None of the financial instruments
of the Company result in material concentration of credit risk.
Credit risk on cash and cash equivalents is limited as the Company generally invest in deposits with banks and financial
institutions with high credit ratings assigned by international and domestic credit rating agencies. Investments primarily
include investment in liquid mutual fund units (including FMP).
The Company takes on exposure to credit risk,which is the risk that counterparty will default on its contractual
obligations resulting in financial loss to the company. Financial asset that potentially expose the Company to credit risks
are listed below :
NOTE 36 : SEGMENT REPORTING
Operating segments are reported consistently with the internal reporting provided to the Board, the highest decision-making
executive who is responsible for allocating resources to and assessing the performance of the operating segments.
A- The business segment has been considered as a primary segment for disclosure. The categories included in each
of the reported business segment are as follows.
1. Electrical Cables
2. Communication Cables
3. Copper Rods
4. Others - Trading of Electrical and other goods
The above business segments have been identified considering
1. The nature of the product/services
2. The Related risks and returns
3. The Internal financial reporting systems
Revenues and expenses have been accounted for based on their relationship to the operating activities of the segment.
Revenues and expenses which relate to the enterprise as a whole and are not allocable to segments on a reasonable
basis have been included under "Unallocable Expenses". Assets and Liabilities which relate to the enterprise as a whole
and are not allocable to segment on a reasonable basis have been included under "Unallocable Assets / Liabilities".
Notes:
1) Total Debt includes current as well as non current lease liabilities and borrowings
2) Earnings available for debt service includes Net Profit after taxes Finance Cost Depreciation and amortisation Impairment on
financial assets Allowances for doubtful debts and advance Net Loss on disposal of property, plant and equipment.
3) Debt Service includes Interest and lease Payments Borrowing repayment
4) Capital Employed includes Tangible Net worth deferred tax liabilities Total Debt
NOTE 39: AUDIT TRAIL DISCLOSURE
The Company has used accounting software for maintaining its books of account for the year ended March 31,2025 which has
a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions
recorded in the software.
Additionally, the audit trail that was enabled and operated for the year ended March 31st, 2024,has been preserved by the
company as per the statutory requirements for record retention.
Note 39 (a) : Relationship with the struck off companies
There are no transactions with struck off companies for the year ending 31st March, 2025 and 31st March, 2024.
Note 39 (b)
No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or
kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries") with
the understanding that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate
Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the
Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the
Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
Note 39 (c)
The Company has been sanctioned working capital limits in excess of ' 5 crores, in aggregate, from banks on the basis
of security of current assets of the Company. The Company has been regularly filling quarterly returns or statements,
provisional/final containing, inter alia, amount of inventory and trade receivable with such banks and are in agreement with
the unaudited books of account of the Company of the respective quarters.
NOTE 40: SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD
There were no significant adjusting events that occurred subsequent to the reporting period other than the events
disclosed.
For and behalf of Board of Directors of Finoiex Cables Limited
Ratnakar Barve Sriraman Raghuraman
Whole Time Director - Chairman Director
(DIN: 09341821) (DIN: 00228061)
M. Viswanathan Siddhesh Mandke
Chief Financial Officer Company Secretary & GM (Legal)
ACS No.: A 20101
Pune : 28th May, 2025
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