2.1.15 Segment Reporting
The Chief Operational Decision Maker (CODM) monitors
the operating results of its business Segments separately
for the purpose of making decisions about resource
allocation and performance assessment. Segment
performance is evaluated based on profit or loss and is
measured consistently with profit or loss in the financial
statements. Operating segments are reported in a manner
consistent with the internal reporting to the CODM.
Accordingly, the Board of Directors of the Company is
CODM for the purpose of segment reporting. Refer note
40 for segment information presented.
2.1.16 Cash and cash equivalents:
Cash comprises cash on hand and demand deposits with
banks. Cash equivalents are short-term balances (with an
original maturity of three months or less from the date of
acquisition), 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.
2.1.17 Statement of Cash flows:
Cash flows from operating activities are reported using
the indirect method, whereby profit / (loss) before tax
is adjusted for the effects of transactions of non-cash
nature and any deferrals or accruals of past or future cash
receipts or payments. The cash flows from operating,
investing and financing activities of the Company are
segregated based on the available information.
Note:2.2
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.
Note 9.4
The general credit period in respective on Domestic and Export sale ranges between 30-90 days and by and large company is
not charging any interest on late payment.
Note 9.5
Credit risk is managed at the operational segmental level. The credit limit and credit period are fixed for each customer after
evaluating the financial position, past performance, business opportunities, credit references etc. The credit limit and the credit
period are reviewed regularly at periodical intervals.
Note 9.6
Concentration risk considers significant exposures relating to industry, counterparty, geography, currency etc. The concentration
of credit risk is not significant as the customer base is large and diversified.
Note 13 Equity Share Capital (Contd..)
Note 13.1 Terms/right attached to Equity Shares:
The company has only one class of shares referred to as Equity shares having face value of Rs. 1/- each (P.Y. Rs. 1 each) Holder of
equity share is entitled to one vote per share.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of
the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution
will be in proportion to the number of equity shares held by the shareholder.
The Company declares and pays dividends in Indian Rupees. The Dividend proposed by the Board of Director is subject to the
approval of the shareholders in the ensuing Annual General Meeting.
(a) Dues to Micro and Small enterprises have been determined to the extent such parties have been identified on the basis of
the information collected by the Management and the same has been relied by the auditor.
(b) Under the Micro, Small and Medium Enterprises Development Act, 2006, (MSMED) which came in to force from 02.10.2006,
certain disclosers are required to be made relating to Micro, Small and Medium enterprises. On the basis of the information
and records available with management, outstanding dues to the Micro and Small enterprise as defined in the MSMED Act,
2006 are disclosed as below:
Level 1 : Quoted prices (unadjusted) in active markets for identical assets and liabilities
Level 2 : Inputs 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)
Level 3 : Inputs for the assets and liabilities that are not based on observable market data (unobservable inputs)
The fair value hierarchy of assets and liabilities measured at fair value are as under:
Note 34 (Contd..)
Note 34.2.2 Investment in unqouted preference shares
The fair value of unquoted preference shares has been determined using Level 3 inputs based on Discounted Cash Flow method.
A one percentage point change in the unobservable inputs used in fair valuation of Level 3 does not have a significant impact on
its value. The movement in unquoted investments is on account of sale of shares during the comparative period (Refer Note 5).
Note 34.2.3 Transfers between levels of fair value hierarchy
There have been no transfers between levels of fair value heirarchy during the year ended 31st March, 2026 and during the
comparative period ended 31st March, 2025.
Note 34.2.4 Valuation Process
The finance department of the company includes a team that performs the valuations of financial assests and liabilities required
for financial reporting purposes, including level 3 fair values. The fair valuation of level 1 and level 2 classified assests and liabilities
are readily available from the qouted prices in the open market and rates available in secondary market respectively. The valuation
method applied for various Financial assests and liabilities are as follows-
1. Quoted price in the primary market cosidered for the fair valuation of the non-current investment. Gain/ (loss) on fair
valuation is recognised in profit and loss.
2. The carrying amount of trade receivable, trade payable, cash and bank balances, short term loans and advances,
statutory/ receivable, short term borrowing, employee dues are considered to be the same as their fair value due to their
short-term nature.
Note 34.3 Financial Risk Management
The company is exposed to market risk, credit risk and liquidity risk. The company's senior management oversees the management
of these risks. The Board of Directors review and agree policies for managing each of these risks, which are summarised below:
Note 34.3.1 Market Risk
Market risk is the risk that the fair value or future cash flow of a financial instrument will fluctuate instrument because of changes
in market factors. Market risk comprises three type of risks:
a. Currency Risk
b. Interest Rate Risk
c. Price Risk
The company is exposed to currency risk and price risk. The same are analysed below:
a. Currency Risk
The company is exposed to foreign exchange risk arising from foreign currency borrowing denominated in US dollars (US$)
and foreign currency notes denominated in various foreign currencies. The company also imports certain material which
are denominated in US$ which exposes it to foreign currency risks. If the value of the Indian Rupee depreciates relative
to these foreign currencies, the related costs may increase. The exchange rates between the Indian Rupee and US$ has
changed substantially in recent periods and may continue to fluctuate substantially in the future. In order to mitigate the
foreign Currency exposure risk, as on 31st March, 2026, the company has entered into derivative contract of Rs. Nil Lakhs
(31st March, 2025 Rs. Nil Lakhs) to hedge exposure to fluctuation risk. The below sensitivity does not include the impact of
foreign currency forward contracts which largly mitigate the risk:
For each of the years ended 31st March, 2026 and 31st March 2025, every percentage point depreciation / appreciation in
the exchange rate between the Indian rupee and U. S. Dollars, has affected company's incremental operating margins by
approximately 0.29% & 0.08% respectively.
Sensitivity analysis is computed based on the changes in the income and expenses in foreign currency upon conversion
into functional currency, due to exchange rate fluctuations between the previous reporting period and the current
reporting period.
b. Price Risk
The company's exposure to price risk arises from investments in equity shares of other companies (Refer Note 5 and 34.1).
The company has not undertaken any risk mitigation measures to reduce the price risk. The table below summarises the
impact of increases / decreases of share price of the investments and profit for the period. The analysis is based on the
assumption that the market price of those investments in equity shares of other companies move by 5% point on either side
with all other variables held constant.
c. Interest Rate Risk
Interest rate risk is the risk that the fair value of future cash flows of the financial instruments will fluctuate because of
changes in market interest rates. In order to optimize the Company's position with regards to interest income and interest
expenses and to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management
by balancing the proportion of fixed rate and floating rate financial instruments in its total portfolio.
According to the Company interest rate risk exposure is only for floating rate borrowings. For floating rate liabilities, the
analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for
the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management
personnel and represents management's assessment of the reasonably possible change in interest rates.
Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The Company maintains its
cash and cash equivalents and bank deposits with banks having good reputation, good past track record and high quality credit
rating and also reviews their credit-worthiness on an on-going basis.
The maximum exposure to credit risk at the reporting date is primarily from trade receivables. Credit risk has always been
managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness
of customers to which the Company grants credit terms in the normal course of business.
On account of the adoption of Ind AS 109, the Company uses ECL model to assess the impairment loss or gain. The Company
uses a provision matrix to compute the ECL allowance for trade receivables and unbilled revenues. The provision matrix takes into
account available external and internal credit risk factors and the Company's experience for customers.
The Company reviews trade receivables on periodic basis and makes provision for doubtful debts if collection is doubtful. The
Company also calculates the expected credit loss (ECL) for non-collection of receivables. The Company makes additional
provision if the ECL amount is higher than the provision made for doubtful debts. In case the ECL amount is lower than the
provision made for doubtful debts, the Company retains the provision made for doubtful debts without any adjustment.
The company has assessed that credit risk on other Financial Asset, the same is insignificant based on the empirical data. Credit
risk from balances with banks and financial institutions is managed by the Company's treasury department in accordance with
the Company's assessment of credit risk about particular financial institution. None of the Company's cash equivalents, including
term deposits (i.e., certificates of deposit) with banks, were past due or impaired as at each balance sheet date.
Note 36 Capital Management Disclosures
Company's objective when managing capital is to safeguard the Company's ability to continue as a going concern in order to
provide return to shareholders and benefits to other stakeholders and to maintain an optimal capital structure to reduce the
cost of capital.
Company manages the capital structure and makes the adjustment to it in the light of changes in economic conditions and risk
characteristics of the underlying assets. The company monitors capital on the gearing ratio basis. This ratio is calculated as net
debt divided by total capital. Net debt is calculated as total borrowings (Non-Current borrowing and current borrowings) less
cash and cash equivalents. Total capital is calculated as total shareholder's equity.
Note 38 Details Of Hedged And Unhedged Exposure in Foreign Currency Denominated Monetary Items
a Exposure in foreign currency - Hedged
The Company enters into forward exchange contracts to hedge against its foreign currency exposures relating to the
underlying transactions and firm commitments. The Company does not enter into any derivative instruments for trading or
speculative purposes.
Note 40 Segment Reporting
The Company is considered to be engaged in Textile Industry with all activity revolving around this business and accordingly the
company has only one reportable business segment in accordance with the requirement of Ind AS 108- Operating Segment.
Note 41
The financial statement are approved by the Board of Directors & Audit Committee at their meeting on 28th May, 2026.
Note 42
A Fire had broken out on 20th Jan, 2026 in Yarn Dying Division at the factory located at PipLaj, Ahmedabad. The Property, Plant and
Equipment destryoed by fire having a net carrying value of Rs. 4.24 Lakhs have been reduced from the block of Property, Plant
and Equipment of the company. The loss in respect of Property, Plant and Equipment due to fire has been presented seprately
under the head of Other Expenses in statement of Profit and Loss. The said loss on account of Fire is fully covered by Insurance.
The Company has accounted for this amount as amount receivalbe from the Insurance company disclosed under "Other Current
Financial Asset" and under statement of Profit and Loss under head "Other Income".
Note 44
On periodical basis and as and when required, the Company reviews the carrying amounts of its assets and found that there is
no indication that those assets have suffered any impairment loss. Hence, no such impairment loss have been provided in the
Financial Year 2025-26 (PY. Rs. Nil Lakhs)
Note: Asset Hypothicated / Mortgage as security includes the Securities hypothecated with the bank for current and non-current
borrowing by the company.
Note 47 - Additional Regualtory Information
The disclosures required by amendment to Division II of Schedule III of the Companies Act, 2013, are given only to the
extent applicable:
(i) Details of Benami Property:The Company does not have any Benami property, where any proceeding has been initiated or
pending against the Company for holding any Benami property.
(ii) Details of Charges: The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond
the statutory period.
(iii) Details of crypto currency or virtual currency : The Company has not traded or invested in Crypto currency or Virtual Currency
during the financial year.
(iv) Utilization of borrowed funds and share premium: The Company has not received any fund from any person(s) or entity(is),
including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
(iv)(a) 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
(iv)(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficial
(v) Undisclosed Income: The Company does not have any 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) Willful Defaulter: The Company is not declared as willful defaulter by any bank or financial institution (as defined under the
Companies Act, 2013) or consortium thereof or other lender in accordance with the guidelines on willful defaulters issued by the
Reserve Bank of India.
(vii) Compliance with number of layers of Companies: The Company has complied with the number of layers for its holding
in downstream companies prescribed under clause (87) of section 2 of the Companies Act, 2013 read with the Companies
(Restriction on number of Layers) Rules, 2017.
Note 47 - Additional Regualtory Information (Contd..)
(viii) Valuation of PP&E, Intangible asset and Investment Property : The Company has not revalued any of its Property, Plant and
Equipment (including Right-of-Use Assets) during the year
(ix) Compliance with approved scheme(s) of arrangements : The Company has not entered into any scheme of arrangement
which has an accounting impact on current or previous financial year.
(x) Details in respect of difference in respect of Current Assets as per Books and details as provided in quarterly returns filed by
the company, the details of the same are as under:
(xi) The Company does not have any transctions or relationships with any companies struck off under section 248 of the
Companies Act, 2013.
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