As per the records of the company, including its register of the shareholders/ members and other declarations received from the shareholders regarding beneficial interest, the above shareholding represent both legal and beneficial ownership of shares.

c) Terms/ rights attached to equity shares

The Company has only one class of shares referred to as equity shares having a par value of ' 10 per share. Each holder of equity shares 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 remaining assets of the company, after payment of all external liabilities. The distribution will be in proportion to the number of equity shares held by the shareholders.

Capital Reserve

This reserve has been created from State subsidy received for establishment of Industry in MIDC, subsidy was received in FY 1994-95

Revaluation Reserve

Plant, Machinery, Land & Building were revalued in FY 2005-06 and the reserve which will be transferred to Revenue Reserve at the time of disposal of the assets

Retained earnings

Retained earnings are the profits that the Company has earned till date and is net of amount transferred to other reserves, if any, and amount distributed as dividend and adjustments on account of transition to Ind AS.

a) Note on Nature of Security on secured loan

i) Term Loan of ' 4.64Cr is taken from YES bank secured by sole charge by way of hypothecation on all movable fixed assets and second charge by way of hypothecation on current assets of the company

Term loan is for a period of 60 months payable in 54 equal monthly installments starting from 29 September 2023

ii) Term loan carry interest rate of 8.75% p.a. - Linked to repo rate

Current reporting period As on 31.03.2024

a) Note on Nature of Security on secured loan

Working Capital facility of ' 8Cr is taken from YES bank secured by first pari pasu charge on all present and future current assets and second charge on movable fixed assets of the company

b) Working capital borrowing carry interest rate of 9.20% p.a. linked to repo rate

Previous reporting period As on 31.03.2023 a) Note on Nature of Security on secured loan

Working Capital facility of ' 8Cr is taken from YES bank secured by first pari pasu charge on all present and future current assets and second charge on movable fixed assets of the company b) Working capital borrowing carry interest rate of 9.20% p.a. linked to repo rate

NOTE-32

SEGMENT REPORTING

Disclosure as required by Ind AS 108 “Operating Segment”, of the Companies (Indian Accounting Standards) Rules, 2015.

Based on the “management approach” as defined in Ind AS 108, the Chief Operating Decision Maker (CODM) evaluates the Company's performance in accordance with Ind AS “Operating Segment”, accordingly the Company has only one reportable operating segment i.e. Chemical Manufacturing

2. Of the above, revenue from sales to USA amounts to Rs 551.49 lakhs (PY Rs 736.51 lakhs), China amounting to Rs 1,034.35 (PY Rs 926.91 lakhs) and to United Kingdom amounting to Rs 882.56 (PY Rs 1,131.18 lakhs)

3. The non-current assets attributable to any particular geographical segment is not material for disclosure.

NOTE-33

Disclosure in accordance with Ind AS - 19 “Employee Benefits”, of the Companies (Indian Accounting Standards) Rules, 2015 Leave Encashment - The company has provided an expense of ' 3.96 lakhs for leave encashment as per Actuarial valuation. Total provision of ' 10.93 lakhs has already been provided.The expense is shown in Employee Benefit expenses in Profit and Loss Statement

Gratuity - The company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement / termination is the employee's last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The Gratuity Plan is a funded plan and the company makes contributions to recognized funds in India. The company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments. The plan typically exposes the company to actuarial risk

The following table summarizes the components of net benefit expense recognized in the statement of profit and loss and in the balance sheet.

The rate used to discount post-employment benefit obligations is determined by reference to market yields at the end of the reporting period on government bonds

Significant actuarial assumptions for the determination of the defined obligation are discount rate, expected salary increase and mortality.

Risk Exposure

Investment Risk - For funded plans that rely on insurers for managing the assets, the value of assets certified by the insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period

Market risk (interest rate) - Market risk is a collective term for risks that are related to the changes and fluctuations of the financial markets. The discount rate reflects the time value of money. An increase in discount rate leads to decrease in Defined Benefit Obligation of the plan benefits & vice versa. This assumption depends on the yields on the corporate/government bonds and hence the valuation of liability is exposed to fluctuations in the yields as at the valuation date.

Longevity risk - The impact of longevity risk will depend on whether the benefits are paid before retirement age or after. Typically for the benefits paid on or before the retirement age , the longevity risk is not very material.

Regulatory Risk - Any Changes to the current Regulations by the Government, will increase (in most cases) or Decrease the obligation which is not anticipated. Sometimes, the increase is many fold which will impact the financials quite significantly.

Actuarial risk

Salary Increase Assumption - Actual Salary increase that are higher than the assumed salary escalation , will result in increase to the obligation at a rate that is higher than expected.

Attrition/Withdrawal Assumption

If actual withdrawal rates are higher then assumed withdrawal rates, the benefits will be paid earlier then expected. Similarly if the actual withdrawal rates are lower then assumed, the benefits will be paid later then expected. The impact of this will depend on the demography of the company and the financials assumptions

1. The management assessed that fair value of cash and short-term deposits, trade receivables, trade payables and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

2. 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.

NOTE-35

FAIR VALUE HIERARCHY

This section explains the judgments and estimates made in determining the fair values of the financial instruments that are (a) recognized and measured at fair value and (b) measured at amortized cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the group has classified its financial instruments into the three levels prescribed under the accounting standard.

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or 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).

FINANCIAL RISK FACTORS

The Company's business activities are exposed to a variety of financial risks: market/business risk, credit risk, exchange risk, etc. The Company's focus is to foresee the unpredictability of financial and business risks and seek to minimize potential adverse effects of these risks on its business and financial performance.

i. Business/ Market Risk

The primary business/market risk to the Company is the price risk and its ability to pass on the same to its customers. The Company's operations extend to a number of countries across the globe and its products pricing competitiveness is a primary factor for the acceptability of Company's products in those markets. The Company has a robust procurement process, which ensures that its pricing power is not adversely affected by price changes in the market place for its raw materials.

The Company also continuously forays into different markets/countries to reduce its complete dependence on any particular country or customer group.

ii. Credit risk

The company is engaged in business of manufacturing of Pyridine, Picoline, Cynopyridine and derivatives of the same. Bulks drugs and nutritional products are toll converted. Receivables are typically not secured by any form of credit support such as letters of credit, performance guarantees or escrow arrangements. Credit risk is the risk that counterparty will not meet its obligations under a financial instrument, leading to a financial loss. The Company is exposed to credit risk from its operating activities and from its financing activities, including deposits with banks and other financial instruments. Financial assets that are potentially subject to concentrations of credit risk and failures by counter-parties to discharge their obligations in full or in a timely manner consist principally of cash, cash equivalents and other receivables. Credit risk on cash balances with Bank are limited because the counterparties are entities with acceptable credit ratings. The exposure to credit risk for loan to related parties is limited because the related parties are entities with acceptable credit rating.

iii. Foreign currency risk

The Company has a system of regularly monitoring its currency wise exposures. The significant part of Company's receivables and payables are in US Dollars which operates as a natural hedge against each other. The Company has a policy not to borrow in a currency where it has no business exposure. The company is in the process of starting currency hedging to safeguard currency exchange losses.

Sensitivity Analysis

The following tables demonstrate the sensitivity to a reasonably possible change in USD and GBP exchange rates, with all other variables held constant. 5% is the sensitivity rate which represents management's assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items that are not hedged by derivative instruments and adjusts their translation at the year end for a 5% change in foreign currency rates. The sensitivity analysis includes foreign vendors. A positive number below indicates increase in profit or equity where the INR strengthens by 5% against the relevant currency. For a 5% weakening of the INR against the relevant currency, there would be a comparable impact on the profit.

v. Interest risk

The Company has domestic borrowings mainly in the nature of bank overdraft facilities. The domestic interest risk is exposed to the changes in the RBI bank rate. The Company manages this risk by managing its working capital effectively.

vi. Estimation uncertainty relating to COVID-19 outbreak

Being manufacturers of chemical, the operations of the Company were exempted from lockdown declared by both the Central and State Governments in the wake of Covid - 19 pandemic. The Company continued with the manufacturing operations at all its manufacturing sites albeit with challenges such as shortage of manpower, availability of materials and disruptions in the logistics and supply chain. The Company has considered the possible effects that may result due to the lockdown announced consequent to outbreak of Covid -19 on the carrying amounts of property, plant and equipment, investments, inventories, receivables and other current assets. Based on internal and external sources of information and economic forecasts, the Company expects the carrying amount of these assets will be recovered and will continue to have sufficient liquidity to fund its business operations as well as expansion plans. However, a definitive assessment of the impact, at this stage, is not possible in view of the highly uncertain economic environment and the situation is still evolving.

CAPITAL MANAGEMENT

For the purpose of the Company's capital management, capital includes paid-up equity share capital and all other equity reserves attributable to the equity holders. The primary objective of the Company's capital management is to maximize the shareholders' value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust its dividend payment ratio to shareholders, return capital to shareholders or issue fresh shares. The Company monitors capital using a gearing ratio, which is net debt divided by its total capital. The Company includes within its net debt the interest bearing loans and borrowings, trade and other payables less cash and cash equivalents.

In order to achieve this overall objective, the Company's capital management, amongst other things, aims to 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 borrowing in the current period.

No changes were made in the objectives, policies or processes for managing the capital during the years ended March 31,2024 and March 31, 2023.

NOTE-38

The Company offsets a financial asset and a financial liability when it currently has a legally enforceable right to set off the recognized amounts and the Company intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. During the year the Company has not settled any such transactions.

Expenditure in Foreign Currency

During the year ended 31^st March 2024, the Company has incurred expenses in foreign currency amounting to '408.94 Lakhs for commission on sales,freight and import of raw material (' 1,289.09 Lakhs on commission on sales, freight import of raw material in FY 22-23)

Reasons for movement

(a) Due to increase in borrowings and trade payables in current year

(b) & (C) Due to increase in borrowings and decrease in profitability in the current year

(d) Due to decrease in sales and profitability in current year

(e) Due to decrease in turnover and increase in production

(f) Due to increse credit terms to regular customers

(g) Due to increase in trade payables and favorable payment terms

(i) & (j) Due to decrease in turnover and increased overheads of the company (k) New Investments were made during the year

NOTE-49

a. The company has not traded or invested in Crypto Currency or Virtual Currency during the financial year

b. The Company does not have any transaction or relationships with any companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of the Companies Act, 1956.

c. The Company has not revalued its Intangible assets during the year. Also, there are no Intangible asset under development in the Company during the current reporting period.

d. No Loans or Advances are granted to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013) either severally or jointly with any other person.

e. There are no transactions that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 which have not been recorded in the books of accounts.

f. There are no charges or satisfaction of charges yet to be registered with Registrar of Companies beyond the statutory period.

g. The company submits monthly statement of stock and trade receivable to bank every month and the statements submitted are in agreement with the books of accounts

h. The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

i. The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a) 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,

b) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

j. The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

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 ,

b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,