There are no other customers who represent more than 10% of the total balance of trade receivables.
14.3 The Company measures the loss allowance for trade receivables at an amount equal to ECL. The expected credit losses on trade receivables are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor's current financial position, adjusted for factors that are specific to the debtors, general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of conditions at the reporting date.
The expected credit loss allowance is based on the ageing of the days the receivables are due and the rates as given in the provision matrix, considering the amounts due from the government undertakings and the other undertakings. Further the Company also establishes an allowance for credit loss that represents its estimate of expected losses in respect of trade and other receivables based on the past and recent collection trend.
No trade or other receivable is due from directors or other officers of the Company either severally or jointly with any other person. No trade or other receivable is due from firms or private Companies respectively in which any director is a partner, a director or a member, other than mentioned above.
During the FY 21-22, the members at the Extra ordinary general Meeting (EGM) held on 28 October 2021 have approved the issue of bonus shares in the ratio of 100 equity shares for every 1 equity share as on the date of EGM. Aggregate number of shares allotted as fully paid up by way of bonus shares is 136,255,300 shares of Rs. 10 each.
The Company has only one class of equity shares having a par value of Rs. 10 each. Each holder is entitled to one vote per equity share. Dividends are paid in Indian Rupees. Dividend proposed by the Board of Directors, if any, is subject to the approval of the shareholders at the Annual General Meeting, except in the case of interim dividend.
Securities premium is used to record the premium realised on issue of securities. The reserve is utilised in accordance with the provisions of the Act. During the year ended 31 March 2023, the securities pemium has been utilised against share issue expense (net of tax benefit) in connection with the IPO of the Company.[Refer Note 18.1 and Note 50(IX)]
During the year ended 31 March 2024, the Company has elected to exercise the option permitted under Section 115BAA of the Income tax Act, 1961. Accordingly the Company had recognised tax expense at concessional rate of 25.168%. Consequently, the deferred tax asset adjusted with Securities Premium for the above IPO expenses has also been remeasured as shown below:
The Special economic zone (SEZ) Reinvestment Reserve has been created out of profit of eligible SEZ unit as per provisions of Section 10AA(1)(ii) of the Income-tax Act, 1961 for acquiring new plant and machinery.
Surplus in statement of profit and loss represents Company's cumulative earnings since its formation less the dividends / capitalisation, if any. These reserves are free reserves which can be utilised for any purpose as may be required.
Fair value gain / (loss) on equity investments classified as FVTOCI reserve has been created on account of change in fair value of the investments. (Refer note 7)
Employee stock option reserve relates to the share options granted by the Company to the Company's and to the employees of SGS Tekniks Manufacturing Private Limited (Subsidiary) under its stock option plan. Refer Note 41 for further details.
I. As at 31 March 2024
(a) Term loan from RBL:
Exclusive charge by way of hypothecation on Plant & Machinery, Equipment's at Bawal Plant, Haryana. Second pari-passu Charge on the entire current assets of the Company both present and future under multiple banking arrangement.
(b) Term loan from Axis bank:
First pari-passu Charge on the movable fixed assets of the Company to the extent of 120% of loan outstanding.
II. As at 31 March 2023
(a) First pari-passu charge on present and future inventories and book debts.
(b) Second pari-passu charge by way of hypothecation on movable fixed assets of the Company, both present and future under multiple banking arrangement.
(c) Second pari-passu charge by way of equitable mortgage on Factory Land & Building property bearing survey number: SF 164/1 PART, situated at Plot no B 27, Phase II, Zone B, area, MEPZ, Tambaram - 600045, owned by the Company.
23.2 Refer note 50(VI) for the comparison of quarterly returns furnished to Banks with books of account.
Note: Pursuant to the settlement agreement entered with one of its customers to settle an ongoing litigation amicably based on mutual understanding between the parties, an amount of Rs. 13.50 million has been agreed as full and final settlement by the Company to the customer which has been considered as an exceptional item in the standalone financial statements for the year ended 31 March 2024.
39 Contingent liabilities and commitments (to the extent not specifically provided for)
Particulars
As at 1 31 March 2024
As at 31 March 2023
(a) Claims against the Company not acknowledged as debt (also refer notes below)
- Erstwhile customer (refer note (iv) below)
-
56.17
- Goods and Services Tax (GST)
6.62
(b) Commitments
- Capital commitments (refer note (vi) below)
584.20
359.37
- Export obligation under Export Promotion Capital Goods (EPCG) Scheme (refer note (v) below)
190.13
- Investments commitment
22.53
22.34
(i) Subsequent to the year ended 31 March 2024, the Company has received demand under section 73(9) CGST Act 2017 and section 20 of IGST Act 2017 amounting to Rs. 2.33 Million (including penalty of Rs. 0.33 Million) with respect to excess ITC availed by the Company for the period April 2018 to 31 March 2022.
(ii) Subsequent to the year ended 31 March 2023, the Company has received demand under section 154 of the Income tax act, 1961 (""IT Act"") amounting to Rs. 46.87 Million for the financial year 2020-21 disallowing the benefit of section 10AA of IT Act due to non-filing of Form 56F within the due date. The Company had filed writ petition against the order before the Honorable High Court of Bombay to quash the said demand. During the year ended 31 March 2024, the Company has withdrawn the petition and claimed the benefit.
(iii) The amounts shown above represent the best possible estimates arrived at on the basis of the available information. The uncertainties and possible reimbursement are dependent on the outcome of the various legal proceedings which have been initiated by the Company or the claimants, as the case may be and therefore, cannot be predicted accurately.
(iv) The Company has filed Special Leave Petition (SLP) before Honorable Supreme Court of India against the Madras High Court Judgment relating to direction to the Company to deposit 50% of the amount in the Court. Supreme court has stayed the order of Madras High court, to pay the said amount. Further, the erstwhile customer, has also filed a counter SLP before the Honorable Supreme Court of India against the Madras High Court Judgment referred above, which is
pending hearing. Based on the assessment carried out by the Company, the Management expects a favorable decision in respect of the above. Further, petition against the Company before National Company Law Tribunal, Mumbai Bench, for initiation of Corporate Insolvency Resolution Process under the Insolvency and Bankruptcy Code has been withdrawn.
During the year ended 31 March 2024 a settlement agreement entered for an amount of Rs. 13.50 million and has been agreed by both the parties as full and final settlement. ( Refer note 38)
(v) The Company has achieved the obligation under EPCG scheme during the current financial year against which the Company is in the process of filing redemption application with the relavent authorities.
(vi) Capital commitments represents the estimated amounts of contracts remaining to be executed on capital account, net of advances and not provided for.
(vii) During the current year, the company has entered into a strategic agreement with a professional consultant for providing transformation program services for a period of 5 years for a consideration which is in the form of fixed and variable consideration. The fixed consideration has been accounted over the period of the agreement. The variable consideration is based on the benefits derived by the company over a period of the agreement. The variable consideration is based on the benefits derived by the company over a period of time based on achievementof milestones and accordingly the same would be accounted in respective periods.
The Company operates a gratuity plan covering qualifying employees. The benefit payable is the amount calculated as per the Payment of Gratuity Act, 1972. The benefit vests upon completion of five years of continuous service and once vested it is payable to employees on retirement or on termination of employment. In case of death while in service, the gratuity is payable irrespective of vesting. The Company makes annual contribution to the group gratuity scheme administered by the Life Insurance Corporation of India.
In respect of the above plans, the actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out as at 31 March 2024 and 31 March 2023 by an independent member firm of the Institute of Actuaries of India. The present value of the defined benefit obligation and the related current service cost and past service cost, were measured using the projected unit credit method.
The actual return on plan assets as furnished by Insurer is Rs. (0.19) Million and Rs. Nil Million for the year ended 31 March 2024 and 31 March 2023 respectively.
(e) The entire plan assets are managed by the insurer. The details with respect to the composition of investments in the fair value of plan assets have not been disclosed in the absence of the necessary information.
(i) The estimate of future salary increase takes into account inflation, seniority, promotion and other relevant factors.
(ii) Discount rate is based on the prevailing market yields of Indian Government bonds as at the balance sheet date for the estimated term of the obligation.
(g) Significant actuarial assumptions for the determination of defined benefit obligation are discount rate, expected salary increase rate, attrition rate and mortality. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting Year while holding all other assumptions constant :
(i) The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligations as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.
(ii) Furthermore, in presenting the above sensitivity analysis the present value of defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period which is the same as that applied in calculating the defined benefit obligation liability recognised in the Balance Sheet.
(iii) There is no change in the methods and assumptions used in preparing the sensitivity analysis from the prior years.
(i) Funding arrangements and funding policy
The Company has purchased an insurance policy to provide for payment of gratuity to the employees. Every year, the insurance Company carries out a funding valuation based on the latest employee data provided by the Company. Any deficit in the assets arising as a result of such valuation is funded by the Company.
On 19 October 2021, the shareholders of the Company have approved the Syrma SGS Employee Stock Option Scheme ("Scheme 1") which forms part of the Syrma SGS Stock Option Plan. Under the Scheme 1, the Company has issued 7,726 options of Rs. 10 each to eligible employees. Employees covered by the plan are granted an option to purchase shares subject to certain vesting conditions. The plan is administered by the 'Nomination and Remuneration Committee' constituted by the Board of Directors of the Company.
On 19 October 2021, the shareholders of the Company have approved the Syrma SGS Employee Stock Option Scheme ("Scheme 2") which forms part of the Syrma SGS Stock Option Plan. Under the Scheme 2, the Company has issued 16,133 options of Rs. 10 each to eligible employees. Employees covered by the plan are granted an option to purchase shares subject to certain vesting conditions. The plan is administered by the 'Nomination and Remuneration Committee' constituted by the Board of Directors of the Company.
Each employee share option converts into one equity share of the Company on exercise of option under Scheme 1 or Scheme 2. Options may be exercised at any time from the date of vesting to the date of their expiry.
The members in the Extra Ordinary General Meeting (EGM) held on 28 October 2021 have approved the issue of bonus shares in the ratio of 100 equity shares for every 1 equity share as on the date of EGM. Consequently, at the time of exercise of share options, each option shall be converted into the ratio of 1:101. The number of options disclosed below are after giving the impact of Bonus issue.
On 08 September 2023, the shareholders of the Holding Company have approved the following:
- the Syrma SGS Employee Stock Option Scheme (""Scheme 3"") which forms part of the Syrma SGS Stock Option Plan and has given power to the Nomination and Remuneration Committee (NRC) of the Holding Company to grant, time to time, in one or more tranches, such number of employee stock options (""Options"") to eligible employees.
- acquisition of shares from secondary market by the Trust for the implementation of 'Syrma SGS - Employee Stock Option Plan 2023' for subsequent allotment to employees.
On 11 January 2024, the NRC has granted 2,35,500 options to eligible employees. Employees covered by the plan are granted an option to purchase shares subject to certain vesting conditions.
(a) As the liabilities for gratuity and leave encashment are provided on actuarial basis for the Company as a whole, the amounts pertaining to KMP are not included above.
(b) The Commission amount disclosed above represents the actual payment made during the year upon receipt of approval of shareholders in general meeting. The amount payable against which provision has been created which is subject to approval of shareholders in general meeting has not been considered for disclsoures w.r.t transactions and year-end balances.
(c) The security deposit amount disclosed above, is presented at the undiscounted amount and not at amortised cost as carried in the financial statements.
(d) The Company accounts for costs incurred by / on behalf of the Related Parties based on the actual invoices / debit notes raised and accruals as confirmed by such related parties. The Related Parties have confirmed to the Management that as at 31 March 2024 and 31 March 2023, there are no further amounts payable to / receivable from them, other than as disclosed above. The Company incurs certain costs on behalf of other companies in the group. These costs have been allocated/recovered from the group companies on a basis mutually agreed to with the group companies.
(e) The aforesaid transactions are disclosed only from the date / upto the date, the party has become / ceases to become a related party to the Company.
(f) The amount of payables/receivables indicated above is after deducting Tax (wherever applicable) and after including Goods and Services Tax (wherever applicable) as charged by/to the counter party as part of the invoice/ relevant document
The amount of transactions disclosed above is without considering Goods and Services Tax (wherever input credit has been availed) as charged by/to the counter party as part of the invoice/relevant document and is gross of withholding tax under the Income Tax Act,1961
(a) The Company, at the inception of a contract assesses whether a contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. In adopting Ind AS 116, the Company has applied the below practical expedients:
(i) The Company has applied a single discount rate to a portfolio of leases with reasonably similar characteristics.
(ii) The Company has treated the leases with remaining lease term of less than 12 months as if they were "short term leases".
(iii) The Company has not applied the requirements of Ind AS 116 for leases of low value assets.
(iv) The Company has excluded the initial direct costs from measurement of the right-of-use asset at the date of transition.
(b) The Company has taken land and buildings on leases having lease terms of more than 1 year to 99 years, with the option to extend the term of leases. Refer note 4 for carrying amount of right-to-use assets at the end of the reporting period by class of underlying asset.
Dilutive component of stock options outstanding as at 31 March 2024 and 31 March 2023, is computed after factoring the impact of issue of bonus shares and ESOP. (Refer note 18).
For the purpose of calculation of basic EPS and dilutive EPS, the outstanding weighted average number of shares includes the shares held by Trust. (Refer note 18)
(i) The tax rate used w.r.t reconciliation above for the year ended March 2024 is corporate tax rate of 25.17% ( for the year ended 31 March 2023 is the 34.94%), including applicable surcharge and cess payable by corporate entities in India on taxable profits under the Income Tax Act, 1961.
(ii) During the year ended 31 March 2024, the Company has elected to exercise the option permitted under Section 115BAA of the Income tax Act 1961. Accordingly the Company had recognised Current tax expense at concessional rate of 25.17%. Consequently, the deferred tax liability carried in the books of the Company has also been remeasured at the aforesaid rate.
The Company has entered into international transactions with its associated enterprises. The Management is of the opinion that the Company maintains the necessary documents as prescribed by the Income Tax Act, 1961 to prove that these international transactions are at arm's length and believes that the same will not have any impact on the financial statements, particularly on the amount of tax expense for the year ended 31 March 2024 and 31 March 2023.
The Company has made provision for contractual warranty obligations and provision for possible contingencies based on the assessment of the amount it expects to incur to meet such obligations. The details of the same are given below:
(a) Provision for warranties is estimated in accordance with the Company's accounting policy (refer note 2.14) and is expected to be settled as and when claims are received.
(b) Whilst the provision for contingencies is considered as short term in nature, the actual outflow with regard to the contingencies depends on various future developments.
The Company manages its capital to ensure that it is able to continue as a going concern while maximizing the return to the stakeholders through the optimization of the debt and equity balance. The Company determines the amount of capital required on the basis of an annual budgeting exercise, future capital projects outlay etc. The funding requirements are met through equity, internal accruals and borrowings (short term / long term).
The Company's treasury function provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Company. These risks include market risk (including currency risk, interest rate risk and other price risk) and credit risk.
The Company has not offset financial assets and financial liabilities.
The Company's activities are exposed to finance risk, interest risk & credit risk. However, the Company is primarily exposed to the financial risks of changes in foreign currency exchange rates. Market risk exposures are measured using sensitivity analysis. There has been no change to the Company's exposure to market risks or the manner in which these risks are being managed and measured.
The Company undertakes transactions denominated in foreign currencies and consequently exposures to exchange rate fluctuation arises. These exposures are reviewed periodically with reference to the risk management policy followed by the Company.
The Company does trade financial instruments which are not designated as hedges for accounting purposes, but provide an economic hedge of the particular transaction risk or a risk component of the transaction. Fair value changes in such derivative instruments are recognised in the statement of profit and loss.
The carrying amounts of the Company's foreign currency denominated monetary assets and monetary liabilities at the end of the reporting year that have not been hedged by a derivative instrument or otherwise are as follows:
The Company is mainly exposed to the currencies of USD, EUR, GBP and JPY.
The following table details the Company's sensitivity to a 5% increase and decrease in the Indian rupees against the relevant foreign currencies. 5% is the rate used in order to determine the sensitivity analysis considering the past trends and expectation of the management for changes in the foreign currency exchange rate. The sensitivity analysis includes the outstanding foreign currency denominated monetary items and adjusts their translation at the year end for a 5% change in foreign currency rates. A positive number below indicates an increase in profit or equity where the Indian Rupees strengthens 5% against the relevant currency. For a 5% weakening of the Indian Rupees against the relevant currency, there would be a comparable impact on the profit or equity and balance below would be negative.
Interest rate is the risk that an upward / downward movement in interest rates would adversely / favourably affect the borrowing costs of the Company.
The sensitivity analysis below have been determined based on exposure to the interest rates for financial instruments at the end of the reporting period and the stipulated change taking place at the beginning of the financial year and held constant throughout the reporting period in case of instruments that have floating rates.
The sensitivity analysis have been carried out based on the exposure to interest rates for term loans from banks, debt securities and borrowings carried at variable rate. If interest rates had been 25 basis points higher or lower and all other variables were constant, the Company's profit after tax would have changed by the following:
Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and borrowing facilities, by continuously monitoring forecast and actual cash flows and by matching maturing profiles of financial assets and financial liabilities in accordance with the risk management policy of the Company. The Company invests its surplus funds in bank fixed deposits and mutual funds.
The following table detail the Company's remaining contractual maturity for its non-derivative financial liabilities with agreed repayment years. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. The table below represents principal and interest cash flows. To the extent that interest rates are floating, the undiscounted amount is derived from interest rate curves at the end of the reporting period. The contractual maturity is based on the earliest date on which the Company may be required to pay.
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of only dealing with creditworthy counterparties. The Company uses other publicly available financial information and its own trading records to rate its major customers. The Company's exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties. Credit exposure is controlled by counterparty limits that are reviewed and approved on a regular basis.
Fluctuation in commodity price affects directly and indirectly the price of raw material and components used by the Company. The key raw material for the Company are Printed Circuit Boards (PCB), Integrated Circuits (IC) and Transistors. The Company imports its few raw materials and due to ongoing situation in international market, these raw material is in shortage or available at higher prices resulting in reduced margins. The Company keeps on negotiating with its customers to recover through price hike of the finished products.
The management assessed that fair value of cash and cash equivalents, trade receivables, loans, borrowings, trade payables and other current financial assets and liabilities approximate their carrying amounts largely due to the shortterm maturities 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 value / amortized cost:
(a) Long-term fixed-rate borrowings are evaluated by the Company based on parameters such as interest rates, specific country risk factors, individual losses and creditworthiness of the receivables
(b) The fair value of unquoted instruments, loans from banks and other financial liabilities, as well as other non-current financial liabilities are estimated by discounting future cash flows using rates currently available for debt on similar terms, credit risk and remaining maturities.
(c) Fair values of the Company's interest-bearing borrowings and loans are determined by using discounted cash flow (DCF) method using discount rate that reflects the issuer's borrowing rate as at the end of the respective reporting period. The own non-performance risk as at 31 March 2024 and 31 March 2023 was assessed to be insignificant.
During the year, the Company's margins have been under pressure due to prices of raw materials , product-sale mix and industry level competition. Consequently the Company's available liquidity has reduced and requirement for working capital loans has gone up resulting in higher debt equity ratio
The Company got listed in the month of August 2022 on stock exchanges thereby increasing the closing equity subtantially as at 31 March 2023 i.e, equity share capital and securities premium, as compared to Opening equity as at 1 April 2022. However while there was an averaging out impact for FY 22-23 , there was no such impact for FY 23-24 since the entire shares issued in IPO were outstanding for the whole year.
Further reduction of long term debt due to repayment of Term loan during the year ended 31 March 2024 with no additional term loans availed has resulted in reduction of long term debt
The Company has availed long term loan (with 1 year moratorium period) during the year ended 31 March 2023, for which repayment shall commence during the FY 24-25.
Further during the year, the Company's margins have been under pressure due to prices of raw materials , product-sale mix and industry level competition. Consequently the Profit before tax and profit after tax have gone down resulting in a reduction of the aforesaid ratio.
The Company got listed in the month of August 2022 on stock exchanges thereby increasing the closing equity subtantially as at 31 March 2023 i.e, equity share capital and securities premium, as compared to Opening equity as at 1 April 2022. However there was an averaging out impact for FY 22-23 and no such impact for FY 23-24 since the entire shares issued in IPO were outstanding for the whole year. Further, the significant part of the proceeds from IPO have been utilised for future capital expansion for which economic benefits will be yielded in the future and not in current year.
During the year, the Company's margins have been under pressure due to prices of raw materials , product-sale mix and industry level competition.. Consequently the Profit before tax and profit after tax have gone down resulting in a reduction of the aforesaid ratio.
During the year, the Company's margins have been under pressure due to prices of raw materials , product-sale mix and industry level competition. Consequently the Profit before tax and profit after tax have gone down resulting in a reduction of the aforesaid ratio.
During the year, the Company's margins have been under pressure due to prices of raw materials , product-sale mix and industry level competition. Consequently the Profit before tax and profit after tax have gone down whereas liquidity and working capital challenges has resulted in higher working capital loans (short term borrowings) and consequently a higher level of Finance Costs. This has resulted in reduction of the aforesaid ratio.
During the year, the Company's margins have been under pressure due to prices of raw materials , product-sale mix and industry level competition resulting in reduction of profit before tax and profit after tax resulting in a reduction of the aforesaid ratio.
(ii) Inventory as per books of account disclosed above excludes goods in transit, inventory of certain divisions of the Company and allowance for obsolete and non-moving inventory.
(iii) The variance in receivables is on account of certain aged debtors more than one year not included in returns filed with Banks as well as period end adjustments such as restatement of foreign currency receivables, reconciliation based on confirmation, etc. being carried out in books post filing of the returns with the banks.
(iv) Receivable as per books of accounts excludes allowance for expected credit losses of the Company.
(v) The above information is based on the revised returns / statements filed by the Company. The purpose of revision was to submit the information as per books of accounts with the banks.
Net IPO Proceeds which were unutilised as at 31 March 2024 and 31 March 2023 were temporarily invested in Deposits with Scheduled commercial banks.
During the year ended 31 March 2023, the Company completed its IPO of 38,187,541 equity shares of face value INR Rs. 10 each at an issue price of INR 220.00 per share, comprising of 34,818,181 fresh shares and offer for sale of 3,369,360 shares by selling shareholder (Ms. Veena Kumari Tandon)
The Company has incurred INR 436.86 Million as IPO related expenses and allocated such expenses between the Company and selling shareholder based on agreement between the Company and selling shareholder and in proportion to the total proceeds raised as stated above, amounting to INR 402.78 Million and INR 34.08 Million respectively. The Company's share of expenses of INR 269.80 Million (Net of tax benefit) has been adjusted against Securities Premium as at 31 March 2023.
Consequently, the deferred tax asset adjusted with Securities Premium for the above IPO expenses has also been remeasured as shown in the above table.
(a) The Company does not have any benami property, where any proceeding has been initiated or pending against the Company for holding any benami property.
(b) The Company did not have any transactions with Companies struck off.
(c) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
(d) The Company has not traded or invested in crypto currency or virtual currency during the financial year.
(e) 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:
(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
(f) 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:
(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.
(g) 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).
(h) The Company has not been declared willful defaulter by any bank or financial Institution or other lender.
(i) The Company does not have any scheme of arrangements which have been approved by the competent authority in terms of sections 230 to 237 of the Act. (Refer note 55)
(j) The Company has complied with the number of layers prescribed under of Section 2(87) of the Act read with the Companies (Restriction on number of Layers) Rules, 2017.
(k) The Company has utilised the borrowing amount taken from financial institutions for the purpose as stated in the sanction letter.
(l) The Company has used an accounting software for maintaining its books of account for the year ended 31 March 2024, 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 software except that:
(i) audit trail feature was not enabled for table parameters for the period from 01 April 2023 to 02 May 2023.
(ii) audit trail feature was not enabled to log direct changes to certain master tables relating to revenue, expenditure, inventory and property, plant and equipment records.
(iii) audit trail feature was not enabled at the database level to log any direct data changes, and
(iv) in respect of a software operated by a third party software service provider, for maintaining payroll records, based on the independent auditor's system and organization controls report of the third party, the third party Company has used a software which has a feature of recording audit trail (edit log) facility and the same has operated during the period 01 April 2023 till 31 December 2023 and no instance of audit trail feature being tampered with has been reported in such independent auditor's report for the aforesaid period.The management is in discussions with the third party software service provider to ensure reporting by their independent auditor on the audit trail feature in their system and organization controls report for the remaining period.
There have been no instances of audit trail feature being tampered with, in respect of accounting software for the period for which the audit trail feature was enabled and operating.
52 The Company has acquired 1,773,278 shares of Johari Digital Healthcare Limited ("JDHL") constituting 51% of the share capital of JDHL vide share purchase agreement dated 1st August 2023 between the Company , JDHL and erstwhile promoters of JDHL by paying a consideration of Rs. 2,295 Million. Pursuant to this JDHL has become a subsidiary of the Company.
The disclosures as required by Ind AS 103 are provided in the Consolidated financial statements for the year ended 31 March 2024
The Company has approached the designated authority and is in the process of filing the required documents as may be required with the designated authority in connection with the various foreign exchange transactions of earlier years, relating
to certain long outstanding payables to foreign parties and receivable from export customers etc., to ensure compliance with the Foreign Exchange Management Act, 1999.
The management is confident of completing all the required formalities and obtaining the required approvals / ratification from the designated authority (AD bank / RBI as the case may be) and does not estimate any outflow of cash on account of the same.
54 During the year ended 31 March 2024, the Company has subscribed to the Share Capital of the following entities, consequent to which these entites have become wholly owned subsidaires:
a. Syrma SGS Design and Manufacturing Private Limited.
b. Syrma SGS Electronics Private Limited
c. Syrma SGS Technology and Engineering Services Private Limited
d. Syrma Semicon Private Limited
e. Syrma Mobility Private Limited
f. Syrma Strategic Electronics Private Limited
55 The Board in its meeting held on 1 November 2023 has approved a scheme of amalgamation and arrangement ("Scheme") involving amalgamation of its wholly owned subsidiaries SGS Tekniks Manufacturing Private Limited and SGS Infosystems Private Limited with the Company. As on 10 May 2024, the Holding Company is awaiting approval of the National Company Law Tribunal (NCLT) for the scheme.
The Board of Directors have recommended a final dividend of 15% (INR 1.5/- per Equity Share of Rs. 10/- each) for the financial year 2023-2024 subject to the approval of the shareholders in the ensuing Annual General Meeting of the Company and hence no provision is created in the standalone financial statments.
In connection with the preparation of the standalone financial statements for the year ended 31 March 2024, the Board of Directors have confirmed the propriety of the contracts / agreements entered into by / on behalf of the Company and the resultant revenue earned / expenses incurred arising out of the same after reviewing the levels of authorisation and the available documentary evidences and the overall control environment. Further, the Board of Directors have also reviewed the realizable value of all the current assets of the Company and have confirmed that the value of such assets in the ordinary course of business will not be less than the value at which these are recognised in the standalone financial statements. In addition, the Board has also confirmed the carrying value of the non-current assets in the financial statements. The Board, duly taking into account all the relevant disclosures made, has approved these financial statements at its meeting held on 10 May 2024 and are subject to the approval of the Shareholders at the Annual General Meeting.