(xix) Provisions, Contingent Liabilities and Contingent
Assets:
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. Provisions are
determined by discounting the expected future cash flows
(representing the best estimate of the expenditure required
to settle the present obligation at the balance sheet date) at
a pre-tax rate that reflects current market assessments of
the time value of money and the risks specific to the liability.
When the Company expects some or all of a provision to be
reimbursed, for example, under an insurance contract, the
reimbursement is recognised as a separate asset, but only
when the reimbursement is virtually certain. The expense
relating to a provision is presented in the Statement of
Profit and Loss net of any reimbursement. The unwinding of
the discount is recognised as finance cost. Expected future
operating losses are not provided for A contingent liability
is a possible obligation that arises from past events whose
existence will be confirmed by the occurrence or non¬
occurrence of one or more uncertain future events beyond
the control of the Company or a present obligation that is
not recognised because it is not probable that an outflow of
resources will be required to settle the obligation or a reliable
estimate of amount cannot be made.
Contingent liabilities may arise from litigation, taxation and
other claims against the Company. The contingent liabilities
are disclosed where it is management's assessment that
the outcome of any litigation and other claims against the
Company is uncertain or cannot be reliably quantified, unless
the likelihood of an adverse outcome is remote.
A contingent liability recognised in a business combination is
initially measured at its fair value. Subsequently, it is measured
at the higher of the amount that would be recognised in
accordance with the requirements for provisions above or the
amount initially recognised less, when appropriate, cumulative
amortisation recognised in accordance with the requirements
for revenue recognition.
Contingent assets are not recognised but are disclosed in the
notes where an inflow of economic benefits is probable.
The company has the policy to provide interest on delayed
payments to MSME vendors as per the provisions of Section 16
of the MSME Act, 2006. Accordingly, the company recognizes
the interest liability only when a present obligation exists on
account of the demand raised by the vendor or when it is
probable that the interest is required to be paid. On the basis
of the past experience and published policies of the company,
if there is no constructive obligation in respect of the probable
outflow of the interest payment, the same is disclosed as
contingent liability.
(xx) Impairment of non-financial assets:
The Company reviews the carrying amounts of non-financial
assets to determine whether there is any indication that those
assets have suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in
order to determine the extent of the impairment loss (if any).
When it is not possible to estimate the recoverable amount of
an individual asset, the Company estimates the recoverable
amount of the cash-generating unit to which the asset
belongs. Each CGU represents the smallest Group of assets
that generates cash inflows that are largely independent of
the cash inflows of other assets or CGUs. When a reasonable
and consistent basis of allocation can be identified, corporate
assets are also allocated to individual cash-generating units,
or otherwise they are allocated to the smallest group of
cash-generating units for which a reasonable and consistent
allocation basis can be identified.
The Company bases its impairment calculation on detailed
budget and forecast calculations, which are prepared
separately for each of the Company's cash-generating unit to
which the individual assets are allocated. For longer periods,
a long term growth rate is calculated and applied to project
future cash flows. To estimate cash flow projections beyond
periods covered by the most recent budget/forecasts,
the Company estimates cash flow projections based on
estimated growth rate.
If the recoverable amount of an asset (or cash-generating unit)
is estimated to be less than its carrying amount, the carrying
amount of the asset (or CGU) is reduced to its recoverable
amount. An impairment loss is recognised immediately in the
Statement of Profit and Loss.
(xxi) Earnings per share:
Basic earnings per equity share is computed by dividing
the net profit/(loss) attributable to the equity holders of the
Company by the weighted average number of equity shares
outstanding during the period. Diluted earnings per equity
share is computed by dividing the net profit/(Loss) attributable
to the equity holders of the Company by the weighted
average number of equity shares considered for deriving
basic earnings per equity share and also the weighted
average number of equity shares that could have been issued
upon conversion of all dilutive potential equity shares. The
dilutive potential equity shares are adjusted for the proceeds
receivable had the equity shares been actually issued at fair
value (i.e. the average market value of the outstanding equity
shares). Dilutive potential equity shares are deemed converted
as of the beginning of the period, unless issued at a later date.
Dilutive potential equity shares are determined independently
for each period presented. The number of equity shares and
potentially dilutive equity shares are adjusted retrospectively
for all periods presented for any share splits and bonus shares
issues including for changes effected prior to the approval of
the standalone financial statements by the Board of Directors.
(xxii) Dividend distribution to equity shareholders of
the Company:
The Company recognises a liability to make dividend
distributions to its equity holders when the distribution is
authorised and the distribution is no longer at its discretion. A
corresponding amount is recognised directly in equity.
(xxiii) Cash Flow Statement:
Cash flows are reported using the indirect method, whereby
profit for the period is adjusted for the effects of transactions
of a non-cash nature, any deferrals or accruals of past or
future operating cash receipts or payments and item of
income or expenses associated with investing or financing
cash flows. The cash flows from operating, investing and
financing activities of the Group are segregated.
(xxiv) Segment Reporting:
Operating segments are reported in a manner consistent with
the internal reporting provided to the chief operating decision
maker.
• Identification of segments:
In accordance with Ind AS 108- Operating Segment,
the operating segments used to present segment
information are identified on the basis of information
reviewed by the Company's management to allocate
resources to the segments and assess their performance.
An operating segment is a component of the Company
that engages in business activities from which it earns
revenues and incurs expenses, including revenues and
expenses that relate to transactions with any of the
Company's other components. Results of the operating
segments are reviewed regularly by the management
team (chairman and chief financial officer) which has
been identified as the chief operating decision maker
(CODM), to make decisions about resources to be
allocated to the segment and assess its performance
and for which discrete financial information is available.
• Allocation of common costs:
Common allocable costs are allocated to each segment
accordingly to the relative contribution of each segment
to the total common costs.
• Unallocated Items:
Revenues and expenses, which relate to the Company
as a whole and are not allocable to segments on a
reasonable basis, have been included under "Unallocated
corporate expenses". Assets and liabilities, which relate
to the Company as a whole and are not allocable to
segments on reasonable basis, are shown as unallocated
corporate assets and liabilities respectively.
• Segment Accounting Policies:
The Company prepares its segment information in
conformity with the accounting policies adopted for
preparing and presenting the financial statements of the
Company as a whole.
(xxv) Investments in subsidiaries, associates and
joint ventures:
Investments in Subsidiaries, Associates 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 investments in
subsidiaries, associates and joint venture, the difference
between net disposal proceeds and the carrying amounts are
recognised in the Statement of Profit and Loss.
(xxvi) 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.
Other Bank deposits
Margin money comprise of bank deposits restricted as to
withdrawal or usage and are used to collateralize certain debt
related obligations with the various lenders. Margin money
bank deposits are classified as current and non-current
based on management expectation of the expiration date of
the underlying restrictions. Interest on these bank deposits is
presented as investing cash flows.
(xxvii) Translation of Foreign Currency Transactions
In preparing the financial statements of the company,
transactions in currencies other than the entity's functional
currency (foreign currencies) are recognized at the rates of
exchange prevailing at the dates of the transactions. At the
end of each reporting period, monetary items denominated
in foreign currencies are retranslated at the rates prevailing
at that date. Non-monetary items carried at fair value that
are denominated in foreign currencies are retranslated
at the rates prevailing at the date when the fair value was
determined. Non-monetary items that are measured in terms
of historical cost in a foreign currency are not retranslated.
Exchange differences on monetary items are recognized in
profit or loss in the period in which they arise.
(xxviii) Exceptional items:
Exceptional items refer to items of income or expense, within
the statement of profit and loss from ordinary activities which
are non-recurring and are of such size, nature or incidence
that their separate disclosure is considered necessary to
explain the performance of the company.
(xxix) Supplier Finance Arrangements:
The Company has established supplier finance arrangements.
The Company evaluates whether financial liabilities covered
such arrangements continue to be classified within trade
payables, or they need to be classified as a borrowing or as
part of other financial liabilities/as a separate line item on the
face of the balance sheet. Such evaluation requires exercise of
judgment basis specific terms of the arrangement.
The Company classifies financial liabilities covered under
supplier finance arrangement within trade payables in the
balance sheet only if (i) the obligation represents a liability
to pay for goods and services, (ii) is invoiced and formally
agreed with the supplier, (iii) is part of the working capital used
in its normal operating cycle, (iv) the Company is not legally
released from its original obligation to the supplier, and has
not assumed a new obligation toward the bank, and another
party (iv) there is no substantial modification to the terms of
the liability.
If one or more of the above criteria are not met, the Company
derecognizes its original liability toward the supplier and
recognize a new liability toward the bank which is classified
as a separate line item on the face of the balance sheet,
depending on factors such as whether the Company (i) has
obligation toward bank, (ii) is getting extended credit period
such that obligation is no longer part of its working capital
cycle, (iii) is paying interest directly or indirectly, (iv) has
provided guarantee or security, and/or (v) is recognized as
borrower in the bank books.
(xxx) Events after the reporting period:
If the Company receives information after the reporting
period, but prior to the date of approved for issue, about
conditions that existed at the end of the reporting period, it
will assess whether the information affects the amounts that
it recognizes in its financial statements. The Company will
adjust the amounts recognized in its financial statements to
reflect any adjusting events after the reporting period and
update the disclosures that relate to those conditions in light
of the new information.
For non-adjusting events after the reporting period, the
Company will not change the amounts recognized in its
financial statements but will disclose the nature of the non¬
adjusting event and an estimate of its financial effect, or
a statement that such an estimate cannot be made, if
applicable.
2.3 Use of estimates and judgements:
The preparation of the Company's financial statements
requires management to make judgments, estimates and
assumptions that affect the reported amounts of revenues,
expenses, assets and liabilities, and the accompanying
disclosures including contingent liabilities. The estimates and
associated assumptions are based on experience and other
factors that management considers to be relevant. Actual
results may significantly differ from these estimates. The
estimates and underlying assumptions are reviewed on an
ongoing basis by the management of the Company. Revisions
to accounting estimates are recognised in the period in which
the estimate is revised if the revision affects only that period,
or in the period of the revision and future periods if the revision
affects both current and future periods. Uncertainty about
these assumptions and estimates could result in outcomes
that require a material adjustment to the carrying amount of
assets or liabilities affected in future periods.
Key Sources of Estimation uncertainty:
The key assumptions concerning the future and other key
sources of estimation uncertainty and judgements at the
reporting date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities
within the next financial year, are described below. Existing
circumstances and assumptions about future developments
may change due to market changes or circumstances arising
that are beyond the control of the Company. Such changes
are reflected in the assumptions when they occur.
a. Useful lives and residual value of property, plant and
equipment
In case of the wind power generation equipment and plant
and equipment for development of solar park facilities
at different location (assets), in whose case the life of the
assets has been estimated at 25 years based on technical
assessment, taking into account the nature of the assets,
the estimated usage of the asset, the operating condition of
the asset, anticipated technological changes, manufacturer
warranties and maintenance support, except for some major
components identified during the year, depreciation on
the same is provided based on the useful life of each such
component based on technical assessment, if materially
different from that of the main asset.
b. Fair value measurement of financial instruments
In estimating the fair value of financial assets and financial
liabilities, the Company uses market observable data to the
extent available. Where such Level 1 inputs are not available,
the Company establishes appropriate valuation techniques
and inputs to the model. The inputs to these models are taken
from observable markets where possible, but where this is not
feasible, a degree of judgment is required in establishing fair
values. Judgments include considerations of inputs such as
liquidity risk, credit risk and volatility. Changes in assumptions
about these factors could affect the reported fair value of
financial instruments.
All assets and liabilities for which fair value is measured or
disclosed in the financial statements are categorised within the
fair value hierarchy, described as follows, based on the lowest
level input that is significant to the fair value measurement as
a whole:
Level 1: Quoted (unadjusted) market prices in active markets
for identical assets or liabilities.
Level 2: Valuation techniques for which the lowest level input
that is significant to the fair value measurement is directly or
indirectly observable.
Level 3: Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.
c. Defined benefit plans (gratuity benefits)
The cost of the defined benefit gratuity plan and the present
value of the gratuity obligation are determined using actuarial
valuations. An actuarial valuation involves making various
assumptions that may differ from actual developments in
the future. These include the determination of the discount
rate, future salary increases and mortality rates. Due to the
complexities involved in the valuation and its long-term nature,
a defined benefit obligation is highly sensitive to changes in
these assumptions. All assumptions are reviewed at each
reporting date.
d. Taxes
Significant management judgment is required to determine
the amount of deferred tax assets that can be recognised,
based upon the likely timing and the level of future taxable
profits together with future tax planning strategies and
future recoverability of deferred tax assets. The amount of
the deferred income tax assets considered realisable could
reduce if the estimates of the future taxable income are
reduced. In assessing the recoverability of deferred tax assets,
the Company relies on the same forecast assumptions used
elsewhere in the financial statements.
e. Impairment of non-financial assets
For determining whether property, plant and equipment are
impaired, it requires an estimation of the value in use of the
relevant cash generating units. The value in use calculation is
based on a Discounted Cash Flow model over the estimated
useful life of the Power Plants. Further, the cash flow projections
are based on estimates and assumptions relating to tariff,
operational performance of the Plants, life extension plans,
exchange variations, inflation, terminal value etc. which are
considered reasonable by the Management.
f. Impairment of financial assets
The impairment provisions for trade receivables are made
considering simplified approach based on assumptions about
risk of default and expected loss rates. The Company uses
judgement in making these assumptions and selecting the
inputs to the impairment calculation based on the Company's
past history and other factors at the end of each reporting
period. In case of other financial assets, the Company applies
general approach for recognition of impairment losses
wherein the Company uses judgement in considering the
probability of default upon initial recognition and whether
there has been a significant increase in credit risk on an
ongoing basis throughout each reporting period.
g. Recognition and measurement of provision and
contingency
The Company recognises a provision if it is probable that an
outflow of cash or other economic resources will be required
to settle the provision. If an outflow is not probable, the item
is treated as a contingent liability. Risks and uncertainties are
taken into account in measuring a provision.
h. Identification of a lease
Management assesses applicability of Ind AS 116 - 'Leases', for
PPAs. In assessing the applicability, the management exercises
judgement in relation to the underlying rights and risks related
to operations of the plant, control over design of the plant
etc., in concluding that the PPA do not meet the criteria for
recognition as a lease.
i. Leases- estimating the incremental borrowing rate
The Company cannot readily determine the interest rate
implicit in the lease, therefore, it uses its incremental borrowing
rate (IBR) to measure lease liabilities. The IBR is the rate of
interest that the Company would have to pay to borrow over a
similar term, and with a similar security, the funds necessary to
obtain an asset of a similar value to the right-of-use asset in a
similar economic environment. The IBR therefore reflects what
the Company 'would have to pay', which requires estimation
when no observable rates are available or when they need to
be adjusted to reflect the terms and conditions of the lease.
The Company estimates the IBR using observable inputs (such
as market interest rates) when available and is required to
make certain entity-specific estimates.
2.4 Standard issued but not effective
The Ministry of Corporate Affairs (MCA), as part of India's
continued convergence with IFRS, has initiated the process
for introduction of Ind AS 118 - Presentation and Disclosure in
Financial Statements, which is converged with IFRS 18 issued
by the IASB in April 2024. Ind AS 118 is intended to replace Ind
AS 1 (Presentation of Financial Statements) and focuses on
improving how entities present and communicate financial
performance, particularly in the Statement of Profit and Loss.
This standard is proposed to be applicable for annual
reporting periods beginning on or after 1 April 2027, subject
to final notification by the MCA through amendment to the
Companies (Indian Accounting Standards) Rules.
2.5 Recent accounting pronouncements
Ministry of Corporate Affairs ("MCA") notifies new standards
or amendments to the existing standards under Companies
(Indian Accounting Standards) Rules as issued from time to
time.
In May 2025, MCA notified amendments to Ind AS 21 - The
Effects of Changes in Foreign Exchange Rates, applicable w.e.f.
April 1, 2025. The Company has reviewed the amendment
and based on its evaluation has determined that it does not
have any significant impact in its financial statements.
In August 2025, MCA notified the following amendments to:
1. Ind AS 1, Presentation of Financial Statements, applicable
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. The Company
has no impact of these amendments in its classification
criteria of current and non-current liabilities.
2. Ind AS 7, Statement of Cash Flows and Ind AS 107,
Financial Instruments: Disclosures, applicable w.e.f. April
1, 2025 - The amendment in Ind AS 7 requires to inform
users of financial statements of the existence of supplier
finance arrangements and explain the nature of the
arrangements, the carrying amount of liabilities and
the range of payment due dates. Ind AS 107 has been
amended to add supplier finance arrangements as a
factor that may cause concentration of liquidity risk. The
Company has reviewed the amendment and based on
its evaluation has determined that it does not have any
significant impact in its financial statements.
3. Ind AS 12, International Tax Reform - Pillar Two Model
Rules applicable immediately - The amendments
provide a temporary mandatory relief from deferred tax
accounting for top-up tax and disclose that they have
applied the relief. This relief is immediate and applies
retrospectively.
(i) Amount given to subsidiaries are interest free and without any specific repayment schedule and therefore the same is
valued at carrying amount which is the fair value.
(ii) Equity shares of the company have been granted to the employees of the company and to the employees of its subsidiaries
companies- (i) KPIG Energia Private Limited and (ii) Sun Drops Energia Limited (Formerly known as Sun Drops Energia Private
Limited) based on the group equity settled share based payment scheme KPI GREEN-ESOP 2023. Equity shares of the
company will vest from time to time on the basis of performance and other eligibility criteriaThe transactions relating to
the subsidairies are accounted by increasing the investment of the company in respective subsidiaries with a corresponding
increase in the share based payment reserve in other equity. During the year the company has made adjustment in respect
of the reassessment/attrition etc.
Terms/Rights Attached to Equity Shares
The Company has only one class of equity shares having a par value of ' 5 each. Each holder of equity shares is entitled to one
vote per share.
In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company,
after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the
shareholders.
Details of Shares Reserved for Employees Stock Options:
Equity shares of the company have been granted to the employees of the company and to the employees of its subsidiaries
acompanies- (i) KPIG Energia Private Limited and (ii) Sun Drops Energia Limited (Formerly known as Sun Drops Energia Private
Limited) based on the group equity settled share based payment scheme KPI GREEN-ESOP 2023. Equity shares of the company
will vest from time to time on the basis of performance and other eligibility criteria. During the year the company has made
adjustment in respect of the reassessment/attrition etc.
(i) Securities Premium is used to record the issue of bonus shares and is utilised in accordance with the provisions of the
Companies Act, 2013.
(ii) Retained Earnings are the profits of the Company earned till date net of appropriations.
(iii) The Board of Directors at its meeting held on 5th August,2025, 21st January ,2026 has declared an interim dividend at ' 0.20
per share, ' 0.25 per share and ' 0.20 per share respectively for the F.Y. 2025-2026 and ' 0.20 per share as final dividend
for FY 2024-25 at its annual general meeting on 26th September,2025 which has been paid by the company during the
year.The company has proposed final dividend of ' 0.25 along with special dividend of ' 0.15 per share for financial year
under reporting.This proposed dividend is subject to the approval of shareholders in the ensuing annual general meeting.
(iv) Equity shares of the company have been granted to the employees of the company and to the employees of its subsidiaries
acompanies- (i) KPIG Energia Private Limited and (ii) Sun Drops Energia Limited (Formerly known as Sun Drops Energia
Private Limited) based on the group equity settled share based payment scheme KPI GREEN-ESOP 2023. Equity shares
of the company will vest from time to time on the basis of performance and other eligibility criteria. During the year the
company has made adjustment in respect of the reassessment/attrition etc.
During the current year, the Board of Directors of the Company, in their meeting held on 17 December, 2025 have approved an
issuance of 1,01,00,000 Warrants, each are convertible into fully paid-up Equity Shares of the Company, on preferential basis
to the Promoter Group of the Company, naming Quyosh Energia Private Limited, up to an amount of ' 47,500.30 Lakhs, at a
issuance price of ' 470.30 per Warrants. Shareholders of the Company, in Extra-ordinary General Meeting held on 16 January,
2026, approved the issuance of Warrants on preferential basis. The Company received an aggregate consideration of ' 11,875.08
Lakhs on 17 February, 2026, towards minimum 25% of the Total Consideration of the Warrants. Each warrant is convertible into
one Equity Share of the Company and the rights attached to Warrants can be exercised at any time, within a period of 18 months
from the date of allotment of Warrants. Upon such conversion, Warrant Holders will hold 4.87% Equity Shares in the Company.
Equity Shares so issued upon conversion of the Warrants, shall rank pari-passu to existing Equity Shares of the Company.
Contract assets:
Contract asset is the right to consideration in exchange for goods or services transferred to the customer. Contract Assets are
transferred to receivables when the rights become unconditional.
Contract liabilities:
A Contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration
(or an amount of consideration is due) from the customer, If the customer pays contribution before the Company transfers goods
or services to the customers, a contract liability is recognized when the payment is made or the payment is due (whichever is
earlier). Contract liabilities are recognized as revenue when the performance of obligation is satisfied.
Equity-settled share option plan
KPI Green Energy Limited - KPI GREEN-ESOP 2023
During the previous year, the shareholders of the Company approved 'KPI GREEN-ESOP 2023' plan. As per the Plan, the Company
has granted 18,04,197 (Eighteen lakhs four thousands one hunder and ninety seven shares) employee stock options to certain
employees of the Company and its subsidiaries at an exercise price of ' 35.33 (Rupees Thirty five and thirty three Paise) per
option exercisable into equivalent equity shares of ' 5 each subject to fulfilment of vesting conditions.
(i) The company has taken xerox machine on lease which is treated as a low value asset as per the exemption given by IND
AS 116 on Leases and hence the rent charged on same ' 4.81 Lakhs (2.79 Lakhs) have been debited to Profit & Loss Account.
(ii) The company has taken hotels, offices and guest houses on lease on temporary basis for short term accomodation of
their site personnel and for employees during travelling for work purposes. Since, the same are for a period of less than 12
months, they have been treated as short -term leases as per the exemption given by IND AS 116 and accordingly the rent
of ' 243.39 Lakhs (155.87 Lakhs) is debited to Profit & Loss Account.
i) Investment in equity instruments of subsidiaries has been accounted at cost in accordance with Ind AS 27. Therefore not
within the scope of Ind AS 109, hence not included here. Amount given to subsidiaries are interest free and without any
specific repayment schedule and therefore the same is valued at carrying amount which is the fair value.
ii) Fair value of financial assets and liabilities measured at amortised cost is not materially different from its carrying value.
Further, impact of time value of money is not significant for the financial instruments classified as current. Accordingly, the
fair value has not been disclosed separately.
iii) Trade Receivables, Cash and Cash equivalents, Other bank balance, Other financial assets, Borrowings (including through
bonds), Trade Payables and Other Current Financial Liabilities: Fair values approximate their carrying amounts largely due
to fixed maturities of these instruments.
ii) Fair values hierarchy
Financial assets and financial liabilities measured at fair value in the balance sheet are categorized into three levels of fair value
hierarchy. The three levels are defined based on the observability of significant inputs to the measurement, as follows:
Level 1: Quoted prices (unadjusted) in active markets for financial instruments.
Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques
which maximize the use of observable market data rely as little as possible on entity specific estimates.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.
Valuation process and technique used to determine fair value
(i) The fair value of investments in government securities and quoted equity shares is based on the current bid price of
respective investment as at the balance sheet date.
(ii) In order to arrive at the fair value of unquoted investments, the company obtains independent valuations. The techniques
used by the valuer are as follows:
a) Asset approach - Net assets value method
b) Income approach - Discounted cash flows ("DCF") method
c) Market approach - Enterprise value/Sales multiple method
Derivative financial assets:
The Company has not entered into derivative financial instruments.
The management assessed that security deposits, loan to
related parties, other financial assets and other financial
liabilities approximate their carrying amounts largely due to
the short-term maturities and without any specific repayment
schedule of these instruments. The fair value of the financial
assets and liabilities is included at the amount at which the
instrument could be exchanged in a current transaction
between willing parties, other than in a forced or liquidation
sale. The following methods and assumptions were used to
estimate the fair values:
(i) Long-term fixed-rate and variable-rate receivables
are evaluated by the Company based on parameters
such as interest rates, individual creditworthiness of
the customer and other market risk factors. Based on
this evaluation, allowances are taken into account for
the expected credit losses of these receivables.
(ii) All the other long term borrowing facilities availed by
the Company are variable rate facilities which are
subject to changes in underlying Interest rate indices.
Further, the credit spread on these facilities are subject
to change with changes in Company's creditworthiness.
The management believes that the current rate of
interest on these loans are in close approximation from
market rates applicable to the Company. Therefore,
the management estimates that the fair value of these
borrowings are approximate to their respective carrying
values.
(i) Risk management framework
The Company's risk management activities are subject to
the management direction and control under the framework
of Risk Management Policy as approved by the Board of
Directors of the Company. The Management ensures
appropriate risk governance framework for the Company
through appropriate policies and procedures so that risks are
identified and measured properly.
The Company's financial liabilities comprise mainly of
borrowings from banks, financial institutions, borrowings
against issue of bonds and inter corporate deposits including
interest accrued, leases, trade, capital and other payables. The
Company's financial assets (other than derivatives) comprise
mainly of investments in subsidiaries and other investments in
mutual funds, cash and cash equivalents, other balances with
banks, loans, trade receivables and other receivables.
The Company has exposure to the following risks arising from
financial instruments:
Ý Credit risk
Ý Liquidity risk
Ý Market risk
A) 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 carrying amount of financial assets represents the
maximum credit exposure.
Credit risk management
The Company assesses and manages credit risk based
on internal credit rating system, continuously monitoring
defaults of customers and other counterparties, identified
either individually or by the company, and incorporates this
information into its credit risk controls. Internal credit rating
is performed for each class of financial instruments with
different characteristics. The Company assigns the following
credit ratings to each class of financial assets based on
the assumptions, inputs and factors specific to the class of
financial assets.
A: Low
B: Medium
C: High
Cash and cash equivalents and other bank balances
Credit risk related to cash and cash equivalents and bank
deposits is managed by only accepting highly rated banks and
diversifying bank deposits and accounts in different banks.
Trade receivables
The Company closely monitors the credit-worthiness of the
debtors through internal systems that are configured to define
credit limits of customers, thereby, limiting the credit risk to
pre-calculated amounts. The Company assesses increase in
credit risk on an ongoing basis for amounts receivable that
become past due and default is considered to have occurred
when amounts receivable become past due one year.
Other financial assets
Other financial assets measured includes deposits with banks,
investments in mutual funds,loans and advances to employees
and others, deposits and other recoverable. Credit risk related
to these other financial assets is managed by monitoring the
recoverability of such amounts continuously, while at the same
time internal control system in place ensure the amounts are
within defined limits.
B) Liquidity risk
Liquidity risk is the risk that the Company will encounter
difficulty in meeting the obligations associated with its financial
liabilities. The Company monitors its risk of shortage of funds
using cash flow forecasting models and matching profiles
of financial assets and liabilities. These models consider the
maturity of its financial investments, committed funding and
projected cash flows from Company's operations including
those of subsidiaries in the form of advance against supplies.
The Company's objective is to provide financial resources to
meet its business objectives in a timely, cost effective and
reliable manner and to manage its capital structure, including
maturity profile of borrowings and requirement of working
capital funds. Having regard to the nature of the business
wherein the Company is able to generate regular cash flows
over a period of time, any surplus cash generated, over and
above the amount required for working capital management
and other operational requirements, is retained as cash and
cash equivalents (to the extent required) and any excess is
invested in highly marketable mutual funds with appropriate
maturities to optimise the cash returns on investments while
ensuring sufficient liquidity to meet its liabilities.
The Company expects to generate positive cash flows from
operations apart from strategic funding from share holders
in order to meet its external financial liabilities as they fall due
and also consistently monitors funding options available in
the debt and capital market with a view to maintain financial
flexibility.
Prudent liquidity risk management implies maintaining
sufficient cash and marketable securities and the availability
of funding through an adequate amount of committed credit
facilities to meet obligations when due. Due to the nature of
the business, the Company maintains flexibility in funding by maintaining availability under committed facilities. Management
monitors rolling forecasts of the Company's liquidity position and cash and cash equivalents on the basis of expected cash flows.
The Company takes into account the liquidity of the market in which the company operates.
Maturities of financial liabilities
The tables below analyze the Company's financial liabilities into relevant maturity of the Company based on their contractual
maturities for all non-derivative financial liabilities.
The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their
carrying balances as the impact of discounting is not significant.
C) 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 risk: interest rate risk, currency risk and price risk.
i) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in
market interest rates. During the year, the Company's exposure to the risk of changes in market interest rates relates primarily to
the Company's debt obligations such as term loans from financial institution/banks with floating interest rates.
The Company's policy is to minimise interest rate cash flow risk exposures on long-term financing. As at March 31, 2026, the
Company is exposed to changes in market interest rates through bank borrowings at variable interest rates.
Sensitivity
The sensitivity analysis have been carried out based on the exposure to interest rates for instruments not hedged against interest
rate fluctuations at the end of the reporting periods. The said analysis has been carried on the amount of floating rate current
borrowings outstanding at the end of the reporting period. A 50 basis point increase or decrease represents the management's
assessment of the reasonably possible change in interest rates.
The year end balances are not necessarily representative of the average debt outstanding during the year.
The Company's fixed deposits are carried at amortised cost and are fixed rate deposits. They are therefore not subject to
interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a
change in market interest rates.
ii) Price risk
Exposure
The Company's exposure price risk arises from investments held and classified in the balance sheet either as fair value through
other comprehensive income or at fair value through profit or loss. To manage the price risk arising from investments, the
Company diversifies its portfolio of assets.
The Company does not have any significant investments in equity instruments which create an exposure to price risk.
iii) 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's exposure to the risk of changes in foreign exchange rates relates primarily to the Company's
operating activities.
The Company's objectives for managing capital is to safeguard continuity and healthy capital ratios in order to support its
business and provide adequate return to shareholders through continuing growth. The Company's overall strategy remains
unchanged from previous year.
The Company determine the amount of capital required on the basis of annual business and long-term operating plans which
include capital and other strategic investments through subsidiaries and obligation to lenders based on maturity profile. The
funding requirements are met through a mixture of equity, debt, internal fund generation and other non - current/current
borrowings. The Company's policy is to use current and non - current borrowings to meet anticipated funding requirements
including preferential allotment of equity to promoter shareholder through warrants in current year. The Company monitors
capital on the basis of the net debt to equity ratio (Capital Gearing ratio).
The Company believes that it will able to meet all its current liabilities and interest obligations in timely manner. The Company's
capital management ensure that it meets financial covenants attached to the interest bearing loans and borrowings that define
capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and
borrowings. There have been no breaches in the financial covenants of any interest bearing loans and borrowings in the current
year. No changes were made in the objectives, policies or processes for managing capital by the Company.
Notes:
1) The Company has filed appeals before the Appellate
authorities in respect of the disputed matter under the
Income Tax Act, 1961 and the appeals are pending with
the appellate authority. Considering the facts of the
matters and other legal pronouncements of jurisdictional
HC, no provision is considered necessary by the
management because the management is hopeful that
the matter would be decided in favour of the Company
in the light of the legal advice obtained by the company.
Amount shown as deducted in the brackets are the
amounts paid against the demand raised by the Income
Tax Department in the Scrutiny assessment. Net amount
is shown as Contingent liabilities not provided for.
2) A revision application is pending before the Collector,
Bharuch under Rule 108(6) of the Gujarat Land Revenue
Rules challenging mutation entries relating to land
acquired by the Company through registered sale deeds.
The Company believes the claims are without merit,
inter alia, as the mutation entries were duly certified
and issues relating to title are outside the scope of
revenue proceedings. Based on legal advice, no liability is
expected to arise and accordingly no provision has been
recognised.
3) A reference is pending before the Labour Court, Bharuch
in relation to an employment dispute wherein the
claimant has sought reinstatement and related reliefs.
The Company is contesting the matter and, based on
legal advice, believes that the likelihood of an outflow of
economic resources is remote. Accordingly, no provision
has been recognised in the financial statements.
4) The company has entered into the transactions with
the vendors who were registered under the MSME Act,
2006. Out of these vendors, the company has identified
some vendors in whose case the payment was delayed
beyond the appointed date and accordingly interest
is payable as per the provisions of Section 16 of the
MSME Act, 2006. However, the said vendors have not
demanded any interest on delayed payments during the
year nor till the date of reporting and hence no provision
has been made in the standalone financial statements
since there is no constructive obligation in respect of the
probable outflow of interest payment.
5) Bank guarantee given by the Company on behalf of
Subsidiary companies and group companies against
which the Subsidiary companies have taken counter
loans from their respective bankers.
54. EMPLOYEE BENEFIT PLANS:
Defined Contribution Plans:
The Company makes specified monthly contributions towards
employee provident fund to Government administered
provident fund scheme which is a defined contribution plan.
The Company's contribution is recognized as an expense in
the statement of profit and loss during the period in which the
employee renders the related service.
The amount recognized as an expense towards contribution
to provident fund for the year aggregated to ' 100.16 Lakhs
(' 69.76 Lakhs).
The amount recognised as an expense towards contribution
to ESI for the year aggregated to ' 1.35 Lakhs (' 1.63 Lakhs).
Company adopted Indian Accounting Standard 19 "Employee
Benefits" (1ND AS 19') as specified in Rule 7 of the Companies
(Accounts) Rules, 2014.
Defined Benefit Plans
The Company operates a defined benefit plan (the Gratuity plan) covering eligible employees, which provides a lump sum
payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the
respective employee's salary and the tenure of employment.
The Company has a defined benefit gratuity plan (unfunded) and is governed by the Payment of Gratuity Act, 1972. Under the
Act, every employee who has completed at least five year of service is entitled to gratuity benefits on departure at 15 days salary
(last drawn salary) for each completed year of service. The scheme is funded.
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.
The sensitivity analysis presented above may not be representative of the actual change in the Defined 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.
Furthermore, in presenting the above sensitivity analysis, the present value of the Defined 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
Defined Benefit Obligation as recognised in the balance sheet.
There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.
56. The Company uses an accounting software for maintaining its books of account 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 accounting
software except for the changes that can be made at the database level to log any direct data changes and at application
layer for the accounting software used for maintaining the books of account relating to Fixed Assets Register throughout the year.
The integration of Fixed Assets Register with the company's accounting software is under development and hence the audit
trail (edit log) is not enabled to that extent. Further, there is no instance of audit trail feature being tampered with in respect of
the accounting software where such feature is enabled. Additionally, the audit trail of relevant prior years has been preserved
for record retention to the extent it was enabled and recorded in those respective years by the Company as per the statutory
requirements for record retention.
57. ADDITIONAL REGULATORY INFORMATION PURSUANT TO THE PROVISIONS OF SCHEDULE III
OF THE COMPANIES ACT, 2013
(i) During the year, the company has not owned any immovable properties whose title deeds are not held in the name of the
company.
(ii) During the year, the company has not hold any investment property.
(iii) During the year, company has not revalued any Property, Plant and Equipment or intangible asset.
(iv) The Company has not granted any loan or advance in nature of loan to promoters, directors, key managerial personnel
and related parties as defined under the Companies Act, 2013 either severally or jointly with any other person that is (a)
repayable on demand; or (b) without specifying any terms or period of repayment expect loans in the nature of equity
support to subsidiaries and other group concerns.
(v) The Company has been sanctioned working capital limits in excess of five crores rupees in aggregate from banks and
financial institutions on the basis of security of current assets of the company. The final quarterly returns/statements filed
by the company with such banks/financial institutions in respect of gross value of current assets, are in agreement with the
books of accounts of the company except in the following cases.
58. THE CODE ON SOCIAL SECURITY, 2020
On November 21, 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 considered restructured
compensation of its employees with effect from April 1, 2026,
and assessed the impact of the changes, consistent with
the Labour Codes, draft rules, FAQs and legal opinion. 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 on the basis of such developments as
needed.
59.OTHER STATUTORY REQUIREMENT
(i) The Company does not have any Benami property,
where any proceeding has been initiated or pending
against the Group for holding any Benami property.
(ii) The Company do not have any charges or satisfaction
which is yet to be registered with ROC beyond the
statutory period.
(iii) The Company have not traded or invested in Crypto
currency or Virtual Currency during the financial year.
(iv) Based on the information available with the Company,
there are no transactions with struck off companies.
(v) The Company does not have 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).
(vi) No funds have been advanced/loaned/invested (from
borrowed funds or from share premium or from any
other sources/kind of funds) by the Company to any
other person(s) or entity(ies), including foreign entities
(Intermediaries), with the understanding (whether
recorded in writing or otherwise) 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 to or on behalf
of the Ultimate Beneficiaries.
No funds have been received by the Company from any
person(s) or entity(ies), including foreign entities (Funding
Parties), 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.
(vii) The Company is in compliance with the number of
layers prescribed under clause (87) of section 2 of
the Companies Act, 2013 read with the Companies
(Restriction on number of Layers) Rules, 2017 (as
amended).
(viii) No Scheme of Arrangements has been approved by
the Competent Authority in terms of sections 230 to 237
of the Companies Act, 2013 during the year. Hence, the
requirements of disclosure of effect of such Scheme of
Arrangements in the books of account in accordance
with the Scheme and in accordance with accounting
standards are not applicable.
60. SIGNIFICANT EVENTS AFTER THE
REPORTING PERIOD
The Company evaluates events and transactions that occur
subsequent to the balance sheet date but prior to approval
of the financial statements to determine the necessity for
recognition and/or reporting of any of these events and
transactions in the financial statements. As of May 6, 2026,
there are no subsequent events to be recognised or reported
61. APPROVAL OF STANDALONE FINANCIAL
STATEMENTS
The Standalone financial statements were approved for issue
by the Board of Directors on May 6, 2026.
62 The figures for the corresponding previous year have
been regrouped/reclassified wherever necessary, to make
them comparable.
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