Provisions are recognised when the Company has a present obligation (legal or
constructive) as a result of past event, 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.

d) Inventories

Items of inventories are measured at lower cost and net realisable value after providing
for obsolescence, if any, except in case of by products which are valued at net
realisable value. Cost of inventories comprises of cost of purchase, cost of conversion
and other costs including manufacturing overheads net of recoverable taxes incurred
in bringing them to their respective present location and condition.

Cost of raw materials, chemicals, stores and spares, packing materials, trading and
other products are determined on weighted average basis.

e) Tax Expenses

The tax expense for the period comprises current and deferred tax. Tax is recognised
in the statement of profit and loss, except to the extent that it relates to items recognised
in the comprehensive income or in equity. In which case, the tax is also recognised in
other comprehensive income or equity.

f) Revenue Recognition

Revenue from sale of goods is recognised when the significant risk and reward of
ownership have been transferred to buyer, recovery of the consideration is probable,
the associated cost can be estimated reliably, there is no continuing effective control
or managerial involvement with the goods, and the amount of revenue can be
measured reliably.

Revenue from rendering of service is recognised when the performance of agreed
contractual task has been completed.

Revenue from sale of goods is measured at the fair value of the consideration received
or receivable, taking into account contractually defined terms of payment and excluding
taxes or duties collected on behalf of the government.

Revenue from operations includes sale of goods, services, service tax, excise duty,
GST and adjusted for discounts (net), and gain/loss on corresponding hedge contracts.

Interest income from financial assets is recognised using the effective interest rate
method.

Provisions are recognised when the Company has a present obligation (legal or
constructive) as a result of past event, 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.

d) Inventories

Items of inventories are measured at lower cost and net realisable value after providing
for obsolescence, if any, except in case of by products which are valued at net
realisable value. Cost of inventories comprises of cost of purchase, cost of conversion
and other costs including manufacturing overheads net of recoverable taxes incurred
in bringing them to their respective present location and condition.

Cost of raw materials, chemicals, stores and spares, packing materials, trading and
other products are determined on weighted average basis.

e) Tax Expenses

The tax expense for the period comprises current and deferred tax. Tax is recognised
in the statement of profit and loss, except to the extent that it relates to items recognised
in the comprehensive income or in equity. In which case, the tax is also recognised in
other comprehensive income or equity.

f) Revenue Recognition

Revenue from sale of goods is recognised when the significant risk and reward of
ownership have been transferred to buyer, recovery of the consideration is probable,
the associated cost can be estimated reliably, there is no continuing effective control
or managerial involvement with the goods, and the amount of revenue can be
measured reliably.

Revenue from rendering of service is recognised when the performance of agreed
contractual task has been completed.

Revenue from sale of goods is measured at the fair value of the consideration received
or receivable, taking into account contractually defined terms of payment and excluding
taxes or duties collected on behalf of the government.

Revenue from operations includes sale of goods, services, service tax, excise duty,
GST and adjusted for discounts (net), and gain/loss on corresponding hedge contracts.

Interest income from financial assets is recognised using the effective interest rate
method.

Financial Assets

A. Initial recognition and measurement

All financial assets and liablities are initially recognised at fair value. Transaction
cost that are directly attributable to the acquisition or issue of financial assets and
financial liablities, which are not fair value through profit or loss, are adjusted to
the fair value on initial recognition. Purchase and sale of financial assets are
recognised using trade date accounting.

B. Subsequent measurement

i. Financial asset carried at ammortised cost

A financial asset is measured at ammortised cost if it is held within a business
model whose objective is to hold the assset in order to collect contractual cash
flows and the contractual terms of the financial assets give rise on specified dates
to cash flows that are solely payment of principal and interest on the principal
outstanding.

ii. Financial asset at fair value through other comprehensive income (FVTOCI)

A financial asset is measured at FVTOCI if it is held within a business model
whose objective is achieved by both collecting contractual cashflows and selling
financial assets and the contractual terms of the financial assets give rise on a
specified date to cash flows that are solely payment of principal and interest on
the principal amount outstanding.

iii. Financial asset at fair value through profit or loss (FVTPL)

A financial asset which is not classified in an y of the above category are measured
at FVTPL.

C. Investment in Subsidiaries, Associates and Joint Ventures

The Company has accounted for its investments in subsidiaries at cost.

D. Other Equity Investments

All other equity investments are measured at fair value, with value changes
recognised in Statement of Profit and Loss, except for those equity investments
for which the company has elected to present the value changes in "Other
Comprehensive Income”.

A. Initial recognition and measurement

All financial liablities are recognized at fair value and in case of loans, net of directly
attributable cost. Fees of recurring nature are directly recognised in the Statement
of Profit and Loss as finance cost.

B. Subsequent measurement

Financial liablities are carried at ammortized cost using the effective interest
method. For trade and other payable maturing within one year from the balance
sheet date, the carrying amount approximate fair value due to the short maturity
of these instruments.

Derivative financial instrument and Hedge Accounting

Derivate financial instrument are initially recognised at fair value on the date on
which derivative contract is entered into and are also susequently measured at
fair value. Derivatives are carried as financial assets when the fair value is positive
and as financial liablities when the value is negative.

Any gain or losses arising from changes in the fair value of derivatives are taken
directly to the Statement of Profit and Loss, except for the effective portion of
cash flow hedge which is recognised in Other Comprehensive Income and later
to Statement of Profit and Loss when the hedged items affects profit or loss or
treated as basis adjustments if a hedged forecast transactions subsequently
results in the recognition of non-financial assets or non financial liablity.

Derecognition of financial instrument

The Company derecognizes a financial asset when the contractual right to cash
flows from the financial assets expire or it transfers the financial asset and the
transfer qualifies for derecognition under Ind AS 109. A financial liablity (or part of
a financial liablity) is derecognized from the company’s Balance Sheet when the
obligation specified in the contract is discharged or cancelled or expires.

h) Material Accounting Estimates

The preparation of the Company’s financial statements requires management to
make judgements, estimates and assumptions that affects the reported amounts
of revenues, expenses, assets and liablities and the accompanying disclosures
and the disclosures of contingent liablities. These includes recognition and
measurement of financial instruments, estimates of useful lives and residual value
of Property, Plant and equipment and intangible assets, valuation of Inventories,
measurements of employee benefits, actuarial assumptions, provisions etc.

Uncertainty about these assumptions and estimates could result in outcomes
that requires a material adjustment to the carrying amount of assets or liablities
affected in future periods. The Company continually evaluates these estimates
and assumptions based on the most recently available information. Revisions to
accounting estimates are recognized prospectively in the Statement of Profit and
Loss in the period in which the estimate are revised and in any future periods
affected.

g) New and revised standards adopted by the CompanyEffective 1st April, 2023, the
Company has adopted the amendments vide Companies (Indian Accounting
Standards) Amendment Rules, 2023 notifying amendment to existing Indian
Accounting Standards.These amendments to the extent relevant to the Company’s
operations include amendment to Ind AS 1 “Presentation of Financial Statements”
which requires the entities to disclose their material accounting policies rather
than their significant accounting policies,Ind AS 8 “Accounting Policies, Changes
in Accounting Estimates and Errors” which has introduced a definition of
‘accounting estimates’ and include amendments to help entities distinguish
changes in accounting policies from changes in accounting estimates.Further,
consequential amendments with respect to the concept of material accounting
policies have also been made in Ind AS 107 “Financial Instruments: Disclosures”
and Ind AS 34 “Interim Financial Reporting”.There are other amendments in various
standards including Ind AS 101 “First-time Adoption of Indian Accounting
Standards”, Ind AS 103 “Business Combinations, Ind AS 109 “Financial Instruments
“ Ind AS 115 “Revenue from Contracts with Customers”, Ind AS 12 “Income Taxes”
which has narrowed the scope of the initial recognition exemption so that it does
not apply to transactions that give rise to equal and offsetting temporary differences
and Ind AS 102 “Share-based Payment” which have not been listed herein above
since these are either not material or relevant to the Company.

Standards issued but not yet effective:

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. For the year ended March 31,2024, MCA has not notified
any new standards or amendments to the existing standards applicable to the
Company.

NOTE 10. 5

The Company has not issued any securities convertible into equity / preference shares.

NOTE 10. 6

During any of the last five years from year ended 31st March, 2024

a. ) No shares were allotted as fully paid up pursuant to contract(s) without payment being received in cash.

b. ) No shares were allotted as fully paid up by way of bonus shares.

c. ) No shares were bought back.

32. FINANCIAL RISK MANAGEMENT OBJECTIVES ( IND AS 107)

The Company’s principal financial liabilities, other than derivatives, comprises of borrowings,
trade and other payables. The main purpose of these financial liabilities is to finance the
company’s operations. The company’s principal financial assets, other than derivatives include
trade and other receivables, investments and cash and cash equivalentas that derive directly
from its operations.

The Company’s activities expose it to market risk, liquidity risk and credit risk. Company’s
overall risk management focuses on the unpredictability of financial markets and seeks to
minimise potential adverse effects on the financial performance of the company. The company
uses derivative financial instruments, such as foregin exchange forward contracts, to hedge
foreign currency risk exposure. Derivatives are used exclusively for hedging purposes and
not as trading or speculative instruments.

The Company has standard operating procedures and investment policy for deployment of
surplus liquidity, which allows investment in debt securities and mutual fund schemes of
debt categories only and restricts the exposure in equity markets.

Compliances of these policies and principles are reviewed by internal auditors on periodicals basis.

The Corporate Treasury team updates the Audit Committee on a quaterly basis about the
implemention of the above policies. It also updates to the Internal Risk Management Committee
of Company on periodcal basis about the various risk to the business and status of various

activities planned to mitigate the risk

A. Market Risk Management:

Market risk is the risk of loss of future earnings, fair values or future cash flows that may
result from a change in the price of a financial instrument. The value of a financial instrument
may change as a result of changes in the interest rates, foreign currency exchange rates,
commodity prices, equity prices and other market changes that affect market risk sensitive
instruments. Market risk is attributable to all market risk senstive financial instruments including
investments and deposits, foreign currency receivables, payables and borrowings.

1) Foreign Currency Risk:

Foreign currency risk is the risk of impact related to fair value or future cash flows of an
exposure in foreign currency, which fluctuate due to changes in foreign exchange rates. The
Company’s exposure to risk of changes in foreign exchange rates relates primarily to import
of raw materials, spare parts, capital expenditure & Exports of finished goods.

When a derivative is entered for the purpose of being a hedge, the Company negotiates the
terms of those derivatives to match the terms of the hedge exposure.

The Company evaluates exchange rate exposure arising from foreign currency transactions.
The Company follows established risk management policies and standard operating
procedures. It uses derivative instruments like foreign currency forwards to hedge exposure
to foreign currency risk.

2) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial istrument will
fluctuate because of changes in market interest rates. The Company’s exposure to risk of
changes in market interest rates primarily to the Company’s short-term borrowing. The
Company constantly monitors the credit markets and rebalances its financing strategies to
achive an optimal maturity profile and financing cost. since all the borrowings are on floating
rate, no significant risk of change in interest rate.

3) Commodity price risk

Commodity price risk for the Company is mainly related to fluctuations of raw materials
prices linked to various external factors,which can affect the production cost of the Company
actively manages inventory and in many cases sale prices are liked to major raw material
prices. Energy costs is also one of the primary costs drivers, any fluctuation in fuel prices
can lead to drop in operating margin. To manage this risk, the Company enters into long¬
term supply agreement for power, identifying new sources of supply etc. Additionally,
processes and policies related to such risks are reviewed and managed by senior
management on continuous basis.

B. Credit Risk Management:

Credit risk arises when a customer or counter party does not meet its obligations under a
financial instrument or customer contract, leading to a financial loss. The Company is exposed
to credit risk from its operating activities (primarily trade receivebles) and from its financing/
investing activities, including deposits with banks, mutual fund investments, and investments
in debt securities, foreign exchange transactions and financial guarantees. The Company
has three major clients which represents 80% receivables as on 31st March, 2023 and
company is receiving payments from these parties within due dates. Hence, the company
has no significant credit risk related to these parties.

Trade Receivables

Trade receivables are consisting of a large number of customers. The Company has credit
evaluation policy for each customer and based on the evaluation credit limit of each customer
is defined. Wherever the company assesses the credit risk as high the exposure is backed
by either letter of credit or security deposits.

As per simplified approach, the Company makes provision of expected credit losses on
trade receivables using a provision matrix to mitigate the risk of default payments and makes
appropriate provision at each reporting date wherever outstanding is for longer period and
involves higher risk.

Investments, Derivative Instruments, Cash and Cash Equivalent and Bank Deposit

Credit Risk on cash and cash equivalent, deposits with the banks/ financial institutions is
generally low as the said deposits have been made with the banks/ financial institutions who

have been assigned high credit rating by international and domestic rating agencies.

Credit Risk on Derivative Instruments are generally low as Company enters into the Derivative
Contracts with the reputed banks and Financial Institutions.

Investments of surplus funds are made only with approved Financial Institutions/Counterparty.
Investments primarily include investment in units of mutual funds. These Mutual Funds and
Counterparties have low credit risk

Total current investments as on 31st March, 2024 is Rs.100 Lacs (31st March, 2023- Nil.)

C. Liquidity Risk Management:

Liquidity risk is defined as the risk that the Company will not able to settle or meet its
obligations on time or at reasonable price. Prudent liquidity risk management implies
maintaining sufficent cash and marketable securities and the availability of fund through
an adequate amount of credit facilities to meet obligations when due. The company’s
treasury team is responsible for liquidity, funding as well as settlement management. In
addition, processes and policies related to such risks are overseen by senior
management. Management monitors the Company’s liquidity position through rolling
forecasts based on expected cash flows.

#Considering nature of financial assets and financial liabilities, fair value is same as amortised
cost.

(B) - FAIR VALUE MEASUREMENTS (IND AS 113):

The fair values of financial assets and liabilities are 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 Company has established the following fair value hierarchy that categorizes the values
into 3 levels. The inputs to valuation techniques used to measure fair value of financial
instruments are:

Level 1: This hierarchy uses quoted (unadjusted) prices in active markets for identical assets
or liabilities. The fair value of all bonds which are trade in the stock exchanges is valued
using the closing price or dealer quotation as at reporting date.

Level 2: The fair value of financial instruments that are not traded in as active market ( For
example trade bonds, over the counter derivatives) is determined using valuation techniques
which maximize the use of observable market data and rely as little as posible on company
specific estimates. The mutual fund units are valued using the closing Net Asset Value. If all
significant inputs required to fair value an instrument are observable, the instrument is included
in Level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the
instrument is included in Level 3.

Provisions are recognised when the Company has a present obligation (legal or
constructive) as a result of past event, 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.

d) Inventories

Items of inventories are measured at lower cost and net realisable value after providing
for obsolescence, if any, except in case of by products which are valued at net
realisable value. Cost of inventories comprises of cost of purchase, cost of conversion
and other costs including manufacturing overheads net of recoverable taxes incurred
in bringing them to their respective present location and condition.

Cost of raw materials, chemicals, stores and spares, packing materials, trading and
other products are determined on weighted average basis.

e) Tax Expenses

The tax expense for the period comprises current and deferred tax. Tax is recognised
in the statement of profit and loss, except to the extent that it relates to items recognised
in the comprehensive income or in equity. In which case, the tax is also recognised in
other comprehensive income or equity.

f) Revenue Recognition

Revenue from sale of goods is recognised when the significant risk and reward of
ownership have been transferred to buyer, recovery of the consideration is probable,
the associated cost can be estimated reliably, there is no continuing effective control
or managerial involvement with the goods, and the amount of revenue can be
measured reliably.

Revenue from rendering of service is recognised when the performance of agreed
contractual task has been completed.

Revenue from sale of goods is measured at the fair value of the consideration received
or receivable, taking into account contractually defined terms of payment and excluding
taxes or duties collected on behalf of the government.

Revenue from operations includes sale of goods, services, service tax, excise duty,
GST and adjusted for discounts (net), and gain/loss on corresponding hedge contracts.

Interest income from financial assets is recognised using the effective interest rate
method.

Provisions are recognised when the Company has a present obligation (legal or
constructive) as a result of past event, 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.

d) Inventories

Items of inventories are measured at lower cost and net realisable value after providing
for obsolescence, if any, except in case of by products which are valued at net
realisable value. Cost of inventories comprises of cost of purchase, cost of conversion
and other costs including manufacturing overheads net of recoverable taxes incurred
in bringing them to their respective present location and condition.

Cost of raw materials, chemicals, stores and spares, packing materials, trading and
other products are determined on weighted average basis.

e) Tax Expenses

The tax expense for the period comprises current and deferred tax. Tax is recognised
in the statement of profit and loss, except to the extent that it relates to items recognised
in the comprehensive income or in equity. In which case, the tax is also recognised in
other comprehensive income or equity.

f) Revenue Recognition

Revenue from sale of goods is recognised when the significant risk and reward of
ownership have been transferred to buyer, recovery of the consideration is probable,
the associated cost can be estimated reliably, there is no continuing effective control
or managerial involvement with the goods, and the amount of revenue can be
measured reliably.

Revenue from rendering of service is recognised when the performance of agreed
contractual task has been completed.

Revenue from sale of goods is measured at the fair value of the consideration received
or receivable, taking into account contractually defined terms of payment and excluding
taxes or duties collected on behalf of the government.

Revenue from operations includes sale of goods, services, service tax, excise duty,
GST and adjusted for discounts (net), and gain/loss on corresponding hedge contracts.

Interest income from financial assets is recognised using the effective interest rate
method.

Financial Assets

A. Initial recognition and measurement

All financial assets and liablities are initially recognised at fair value. Transaction
cost that are directly attributable to the acquisition or issue of financial assets and
financial liablities, which are not fair value through profit or loss, are adjusted to
the fair value on initial recognition. Purchase and sale of financial assets are
recognised using trade date accounting.

B. Subsequent measurement

i. Financial asset carried at ammortised cost

A financial asset is measured at ammortised cost if it is held within a business
model whose objective is to hold the assset in order to collect contractual cash
flows and the contractual terms of the financial assets give rise on specified dates
to cash flows that are solely payment of principal and interest on the principal
outstanding.

ii. Financial asset at fair value through other comprehensive income (FVTOCI)

A financial asset is measured at FVTOCI if it is held within a business model
whose objective is achieved by both collecting contractual cashflows and selling
financial assets and the contractual terms of the financial assets give rise on a
specified date to cash flows that are solely payment of principal and interest on
the principal amount outstanding.

iii. Financial asset at fair value through profit or loss (FVTPL)

A financial asset which is not classified in an y of the above category are measured
at FVTPL.

C. Investment in Subsidiaries, Associates and Joint Ventures

The Company has accounted for its investments in subsidiaries at cost.

D. Other Equity Investments

All other equity investments are measured at fair value, with value changes
recognised in Statement of Profit and Loss, except for those equity investments
for which the company has elected to present the value changes in "Other
Comprehensive Income”.

A. Initial recognition and measurement

All financial liablities are recognized at fair value and in case of loans, net of directly
attributable cost. Fees of recurring nature are directly recognised in the Statement
of Profit and Loss as finance cost.

B. Subsequent measurement

Financial liablities are carried at ammortized cost using the effective interest
method. For trade and other payable maturing within one year from the balance
sheet date, the carrying amount approximate fair value due to the short maturity
of these instruments.

Derivative financial instrument and Hedge Accounting

Derivate financial instrument are initially recognised at fair value on the date on
which derivative contract is entered into and are also susequently measured at
fair value. Derivatives are carried as financial assets when the fair value is positive
and as financial liablities when the value is negative.

Any gain or losses arising from changes in the fair value of derivatives are taken
directly to the Statement of Profit and Loss, except for the effective portion of
cash flow hedge which is recognised in Other Comprehensive Income and later
to Statement of Profit and Loss when the hedged items affects profit or loss or
treated as basis adjustments if a hedged forecast transactions subsequently
results in the recognition of non-financial assets or non financial liablity.

Derecognition of financial instrument

The Company derecognizes a financial asset when the contractual right to cash
flows from the financial assets expire or it transfers the financial asset and the
transfer qualifies for derecognition under Ind AS 109. A financial liablity (or part of
a financial liablity) is derecognized from the company’s Balance Sheet when the
obligation specified in the contract is discharged or cancelled or expires.

h) Material Accounting Estimates

The preparation of the Company’s financial statements requires management to
make judgements, estimates and assumptions that affects the reported amounts
of revenues, expenses, assets and liablities and the accompanying disclosures
and the disclosures of contingent liablities. These includes recognition and
measurement of financial instruments, estimates of useful lives and residual value
of Property, Plant and equipment and intangible assets, valuation of Inventories,
measurements of employee benefits, actuarial assumptions, provisions etc.

Uncertainty about these assumptions and estimates could result in outcomes
that requires a material adjustment to the carrying amount of assets or liablities
affected in future periods. The Company continually evaluates these estimates
and assumptions based on the most recently available information. Revisions to
accounting estimates are recognized prospectively in the Statement of Profit and
Loss in the period in which the estimate are revised and in any future periods
affected.

g) New and revised standards adopted by the CompanyEffective 1st April, 2023, the
Company has adopted the amendments vide Companies (Indian Accounting
Standards) Amendment Rules, 2023 notifying amendment to existing Indian
Accounting Standards.These amendments to the extent relevant to the Company’s
operations include amendment to Ind AS 1 “Presentation of Financial Statements”
which requires the entities to disclose their material accounting policies rather
than their significant accounting policies,Ind AS 8 “Accounting Policies, Changes
in Accounting Estimates and Errors” which has introduced a definition of
‘accounting estimates’ and include amendments to help entities distinguish
changes in accounting policies from changes in accounting estimates.Further,
consequential amendments with respect to the concept of material accounting
policies have also been made in Ind AS 107 “Financial Instruments: Disclosures”
and Ind AS 34 “Interim Financial Reporting”.There are other amendments in various
standards including Ind AS 101 “First-time Adoption of Indian Accounting
Standards”, Ind AS 103 “Business Combinations, Ind AS 109 “Financial Instruments
“ Ind AS 115 “Revenue from Contracts with Customers”, Ind AS 12 “Income Taxes”
which has narrowed the scope of the initial recognition exemption so that it does
not apply to transactions that give rise to equal and offsetting temporary differences
and Ind AS 102 “Share-based Payment” which have not been listed herein above
since these are either not material or relevant to the Company.

Standards issued but not yet effective:

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. For the year ended March 31,2024, MCA has not notified
any new standards or amendments to the existing standards applicable to the
Company.

NOTE 10. 5

The Company has not issued any securities convertible into equity / preference shares.

NOTE 10. 6

During any of the last five years from year ended 31st March, 2024

a. ) No shares were allotted as fully paid up pursuant to contract(s) without payment being received in cash.

b. ) No shares were allotted as fully paid up by way of bonus shares.

c. ) No shares were bought back.

32. FINANCIAL RISK MANAGEMENT OBJECTIVES ( IND AS 107)

The Company’s principal financial liabilities, other than derivatives, comprises of borrowings,
trade and other payables. The main purpose of these financial liabilities is to finance the
company’s operations. The company’s principal financial assets, other than derivatives include
trade and other receivables, investments and cash and cash equivalentas that derive directly
from its operations.

The Company’s activities expose it to market risk, liquidity risk and credit risk. Company’s
overall risk management focuses on the unpredictability of financial markets and seeks to
minimise potential adverse effects on the financial performance of the company. The company
uses derivative financial instruments, such as foregin exchange forward contracts, to hedge
foreign currency risk exposure. Derivatives are used exclusively for hedging purposes and
not as trading or speculative instruments.

The Company has standard operating procedures and investment policy for deployment of
surplus liquidity, which allows investment in debt securities and mutual fund schemes of
debt categories only and restricts the exposure in equity markets.

Compliances of these policies and principles are reviewed by internal auditors on periodicals basis.

The Corporate Treasury team updates the Audit Committee on a quaterly basis about the
implemention of the above policies. It also updates to the Internal Risk Management Committee
of Company on periodcal basis about the various risk to the business and status of various

activities planned to mitigate the risk

A. Market Risk Management:

Market risk is the risk of loss of future earnings, fair values or future cash flows that may
result from a change in the price of a financial instrument. The value of a financial instrument
may change as a result of changes in the interest rates, foreign currency exchange rates,
commodity prices, equity prices and other market changes that affect market risk sensitive
instruments. Market risk is attributable to all market risk senstive financial instruments including
investments and deposits, foreign currency receivables, payables and borrowings.

1) Foreign Currency Risk:

Foreign currency risk is the risk of impact related to fair value or future cash flows of an
exposure in foreign currency, which fluctuate due to changes in foreign exchange rates. The
Company’s exposure to risk of changes in foreign exchange rates relates primarily to import
of raw materials, spare parts, capital expenditure & Exports of finished goods.

When a derivative is entered for the purpose of being a hedge, the Company negotiates the
terms of those derivatives to match the terms of the hedge exposure.

The Company evaluates exchange rate exposure arising from foreign currency transactions.
The Company follows established risk management policies and standard operating
procedures. It uses derivative instruments like foreign currency forwards to hedge exposure
to foreign currency risk.

2) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial istrument will
fluctuate because of changes in market interest rates. The Company’s exposure to risk of
changes in market interest rates primarily to the Company’s short-term borrowing. The
Company constantly monitors the credit markets and rebalances its financing strategies to
achive an optimal maturity profile and financing cost. since all the borrowings are on floating
rate, no significant risk of change in interest rate.

3) Commodity price risk

Commodity price risk for the Company is mainly related to fluctuations of raw materials
prices linked to various external factors,which can affect the production cost of the Company
actively manages inventory and in many cases sale prices are liked to major raw material
prices. Energy costs is also one of the primary costs drivers, any fluctuation in fuel prices
can lead to drop in operating margin. To manage this risk, the Company enters into long¬
term supply agreement for power, identifying new sources of supply etc. Additionally,
processes and policies related to such risks are reviewed and managed by senior
management on continuous basis.

B. Credit Risk Management:

Credit risk arises when a customer or counter party does not meet its obligations under a
financial instrument or customer contract, leading to a financial loss. The Company is exposed
to credit risk from its operating activities (primarily trade receivebles) and from its financing/
investing activities, including deposits with banks, mutual fund investments, and investments
in debt securities, foreign exchange transactions and financial guarantees. The Company
has three major clients which represents 80% receivables as on 31st March, 2023 and
company is receiving payments from these parties within due dates. Hence, the company
has no significant credit risk related to these parties.

Trade Receivables

Trade receivables are consisting of a large number of customers. The Company has credit
evaluation policy for each customer and based on the evaluation credit limit of each customer
is defined. Wherever the company assesses the credit risk as high the exposure is backed
by either letter of credit or security deposits.

As per simplified approach, the Company makes provision of expected credit losses on
trade receivables using a provision matrix to mitigate the risk of default payments and makes
appropriate provision at each reporting date wherever outstanding is for longer period and
involves higher risk.

Investments, Derivative Instruments, Cash and Cash Equivalent and Bank Deposit

Credit Risk on cash and cash equivalent, deposits with the banks/ financial institutions is
generally low as the said deposits have been made with the banks/ financial institutions who

have been assigned high credit rating by international and domestic rating agencies.

Credit Risk on Derivative Instruments are generally low as Company enters into the Derivative
Contracts with the reputed banks and Financial Institutions.

Investments of surplus funds are made only with approved Financial Institutions/Counterparty.
Investments primarily include investment in units of mutual funds. These Mutual Funds and
Counterparties have low credit risk

Total current investments as on 31st March, 2024 is Rs.100 Lacs (31st March, 2023- Nil.)

C. Liquidity Risk Management:

Liquidity risk is defined as the risk that the Company will not able to settle or meet its
obligations on time or at reasonable price. Prudent liquidity risk management implies
maintaining sufficent cash and marketable securities and the availability of fund through
an adequate amount of credit facilities to meet obligations when due. The company’s
treasury team is responsible for liquidity, funding as well as settlement management. In
addition, processes and policies related to such risks are overseen by senior
management. Management monitors the Company’s liquidity position through rolling
forecasts based on expected cash flows.

#Considering nature of financial assets and financial liabilities, fair value is same as amortised
cost.

(B) - FAIR VALUE MEASUREMENTS (IND AS 113):

The fair values of financial assets and liabilities are 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 Company has established the following fair value hierarchy that categorizes the values
into 3 levels. The inputs to valuation techniques used to measure fair value of financial
instruments are:

Level 1: This hierarchy uses quoted (unadjusted) prices in active markets for identical assets
or liabilities. The fair value of all bonds which are trade in the stock exchanges is valued
using the closing price or dealer quotation as at reporting date.

Level 2: The fair value of financial instruments that are not traded in as active market ( For
example trade bonds, over the counter derivatives) is determined using valuation techniques
which maximize the use of observable market data and rely as little as posible on company
specific estimates. The mutual fund units are valued using the closing Net Asset Value. If all
significant inputs required to fair value an instrument are observable, the instrument is included
in Level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the
instrument is included in Level 3.

The management assessed that fair value of cash and bank balances, trade receivables,
trade paybles, cash credits, commercial papers and other financial assets and liabilities
approximate their carrying amounts largely due to the short- term maturities of these
instruments.

The following methods and assumptions were used to estimate the fair values.

(a) The fair values of the quoated investments/units of mutual fund schemes are based
on market price/ net asset value at the reporting date.

(b) The fair values of forward foreign exchange contracts is calculated as the present
value determined using forward exchange rates and interest rate curve of the respective
currencies.

(c) The fair value of the remaining financial instruments is determined using discounted
cash flow analysis or based on the contractual terms. The discount rates used is
based on management estimates.

Proposed dividendes on equity shares are subject to approval at the annual general meeting
and are not recognized as a liability as at 31st March 2024.

(B) - CAPITAL MANAGEMENT (IND As 1):

The Company’s objectives when managing capital are to (a) maximise shareholder value
and provide benefits to other stakeholders and (b) maintain an optimal capital structure to
reduce the cost of capital.

For the pupose of the Company’s capital management, capital includes issued capital, share
premium and all other equity reserves attributable to the equity holders.

The Company monitors capital using debt-equity ratio, which is total debt dividend by total
equity.

In addition the Company has financial convenants relating to the borrowing facilities that it
has taken from the lenders like interest coverange service ratio, Debt to EBITDA, etc. which
is maintained by the Company.

35 GOVERNMENT GRANT (IND AS 20) :

Government grant received during the year - Rs. Nil (Previous Year Nil)