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
All 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.
All 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
amortized 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
recognized 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 loss allowance. The Company recognizes
life-time impairment 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
loss allowance 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
1. Ind AS 1, Presentation of Financial Statements,
w.e.f April 1.2025 -
The amendment relates to classification of liabilities
as current or non -current and non-current liabilities
with covenants. In the context of classifying a
liability as current, it removes the requirement
of existence of a right to defer settlement for
at least 12 months after the reporting date,
and instead requires that the said right should
exist on the reporting date and have substance.
The amendment also introduces guidance on
classification of liabilities with covenants.
2. Ind AS 107, Financial Instruments: Disclosures,
w.e.f. April 1, 2025 -
The amendment introduces enhanced disclosure
requirements for supplier finance arrangements
(such as supply-chain finance or reverse factoring).
Entities are required to disclose information that
enables users of financial statements to assess
the effects of such arrangements on the entity's
liabilities, cash flows and exposure to liquidity risk.
The disclosures include the nature and terms of
the arrangements, the carrying amounts of related
financial liabilities, the portion for which suppliers
have already been paid by finance providers, and
a comparison of payment terms under supplier
finance arrangements with those of normal
trade payables.
These amendments do not have material impact on
the Company's operations or financial statements.
The Company does not has a material impact on its
operations or financial statements on account of
these amendments.
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 and recognised and
disclosed as investment in joint venture accounted for using equity method. FJPS is engaged in manufacturing and sale of extra
high voltage power cables.
Considering the financial performance of the joint venture, brought forward losses and its continued dependency on joint
venture partners, the Company had in accordance with Ind AS - 36 ""Impairment of Assets"" carried out impairment assessment
of its investment in FJPS accounted for using equity method by comparing its recoverable amount (enterprise value) with its
carrying amount as at 31st March, 2026.
The recoverable amount of the investment in FJPS is assessed based on future discounted cash flows of FJPS (enterprise value).
Key assumptions used for value in use to determine the recoverable value are:
1- Discount rate - Weighted Average Cost of Capital (WACC) - 14.55% (Previous year 15%)
2- Terminal growth rate 5% (Previous year 5%)
Note 12.1
Trade Receivables:
The average credit period for the Company's receivables is 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 2026 includes ' 23.08 crores from Telecommunication Consultants India Limited (31st March 2025 included ' 25.43
crores) ' 218.25 crores from Minda Corporation Ltd, Bharti Airtel Limited, Reliance Jio Infocomm, Aptiv Components India Private Limited,
Dhoot Transmission Ltd and Yazaki India Pvt Ltd (31st March, 2025 included ' 152.54 crores from Minda Corporation Ltd, Bharti Airtel Limited,
Fort Gloster Industries Pvt Ltd, Aptive Components India Private 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.
* The Government of India has merged 29 existing labour laws into a unified framework comprising 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, effective from November 21, 2025. Based on the information and consistent with the guidance provided by the Institute of
Chartered Accountants of India, the Company has evaluated and recorded the resulting incremental financial impact of ' 6.01 crores in past
service cost (employee benefits cost) in these financial results and statements for the year ended March 31, 2026. Once Central / State Rules
are notified by the Government on all aspects of the Codes, the Company will evaluate impact, if any, on the measurement of employee
benefits and would provide appropriate accounting treatment.
ii Other Commitment
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 ?7.27 crores (31st March 2025 - ' 6.92 crores) for provident fund contributions.
Contribution for superannuation funds ? Nil (31st March 2025 - ' Nil) 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 Code on Social Security, 2020.
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.
Valuation technique(s) and key input(s):
Level 1 The fair value of mutual funds (includes FMP) and quoted equity shares is based on net assets value (NAV)
and quoted price.
Level 2 The fair value of unquoted equity shares is determined using market approach. This approach involves the
application of multiples, derived from market prices of comparable listed companies, to the parameters of the
subject company in order to derive a value for the subject company.
2. Capital Management
The Company's policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence
and to sustain future development of the business. The Company monitors the return on capital as well as the level of
dividends on its equity shares. The Company's objective when managing capital is to maintain an optimal structure so as
to maximize shareholder value.
(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.
3.2 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).
3.3 Liquidity risk management
The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities,
by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and
liabilities. The maturity profile of the financial liabilities are listed below:
1. Key managerial Personnel are entitled to post- employement benefits recognised as per IND-AS 19-'Employee Benefits' in
the financial statements. As these employee benefits are lump sum amounts provided on the basis of acturial valuation,
the same is not included above.
2. All transactions with related parties have been done at arms length basis and in normal course of business.
3. In respect of Finolex J Power Systems Limited Corporate Guarantee of '185.65 Crores as on 31st March 2026 has provided
(Previous Year as on 31st March 2025 146.45 Crores)- refer Note 32(A)(II)(a)
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".
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 Net impairment loss/(reversal) on account receivable Net Loss on disposal of property,
plant and equipment.
3) Debt Service includes lease Payments and borrowings.
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 financial year ended March 31, 2026
which have the 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 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, 2026 and 31st March, 2025.
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.
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