A provision is recognized when theCompany has a present obligation as aresult of past event and it is probable thatan outflow of resources will be required tosettle the obligation, in respect of which areliable estimate can be made. Provisions(excluding retirement benefits andcompensated absences) are not discountedto its present value and are determinedbased on best estimate required to settlethe obligation at the balance sheet date.
These are reviewed at each balance sheetdate and adjusted to reflect the currentbest estimates. Contingent liabilities are notrecognized in the financial statements. Acontingent asset is neither recognized nordisclosed in the financial statements (ReferNote 33).
Useful lives of property, plant andequipment
The Company reviews the useful life ofproperty, plant and equipment at the endof each reporting period. This reassessmentmay result in change in depreciationexpense in future periods (Refer Note 2.11).
Employee benefits
The accounting of employee benefit plansin the nature of defined benefit requiresthe Company to use assumptions. Theseassumptions have been explained underemployee benefits note 2.13.
Cash dividend to the equity holders of theCompany
The Company recognises a liability tomake cash distributions to equity holdersof the Company when the distribution isauthorised, and the distribution is no longerat the discretion of the Company. Finaldividends on shares is recorded as a liabilityon the date of approval by the shareholdersand dividends are recorded as a liability onthe date of declaration by the Company’sBoard of Directors (Refer Note 42).
Leases
The Company evaluates if an arrangementqualifies to be a lease as per the requirementsof Ind AS 116. Identification of a lease requiressignificant judgement. The Company usessignificant judgement in assessing the leaseterm (including anticipated renewals) andthe applicable discount rate.
The Company determines the lease termas the non-cancellable period of a lease,together with both periods covered by anoption to extend the lease if the Company
is reasonably certain to exercise thatoption; and periods covered by an optionto terminate the lease if the Company isreasonably certain not to exercise thatoption. In assessing whether the Companyis reasonably certain to exercise an optionto extend a lease, or not to exercise anoption to terminate a lease, it considers allrelevant facts and circumstances that createan economic incentive for the Company toexercise the option to extend the lease, ornot to exercise the option to terminate thelease. The Company revises the lease termif there is a change in the non-cancellableperiod of a lease.
The discount rate is generally based on theincremental borrowing rate specific to thelease being evaluated or for a portfolio ofleases with similar characteristics (ReferNote 2.6).
The Company earns revenue primarilyfrom providing information technology,engineering design, systems integrationand support services, sale of licenses andmaintenance of equipment. The Companyrecognizes revenue as followsRevenue is recognised upon transfer ofcontrol of promised products or servicesto customers in an amount that reflects theconsideration which the Company expectsto receive in exchange for those productsor services.
• Revenue from time and material andjob contracts is recognised on outputbasis measured by units delivered,efforts expended, etc.
• Revenue related to fixed pricemaintenance and support servicescontracts where the Company is readyto provide services is recognised basedon time elapsed mode and revenueis straight lined over the period ofperformance.
• In respect of other fixed-price contracts,revenue is recognised using percentage-of-completion method ('POC method’)of accounting with contract costincurred determining the degreeof completion of the performanceobligation. The contract cost used incomputing the revenues include cost offulfilling warranty obligations.
• Revenue from the sale of distinctinternally developed software andmanufactured systems and third partysoftware is recognised upfront atthe point in time when the system/software is delivered to the customer.In cases where implementation and/or customisation services renderedsignificantly modifies or customisesthe software, these services andsoftware are accounted for as a singleperformance obligation and revenue isrecognised over time on a POC method.
• Revenue from the sale of distinct thirdparty hardware is recognised at thepoint in time when control is transferredto the customer.
• The solutions offered by the Companymay include supply of third-partyequipment or software. In such cases,revenue for supply of such third partyproducts are recorded at gross ornet basis depending on whether theCompany is acting as the principalor as an agent of the customer. TheCompany recognises revenue in thegross amount of consideration whenit is acting as a principal and at netamount of consideration when it isacting as an agent.
Revenue is measured based on thetransaction price, which is the consideration,adjusted for volume discounts, servicelevel credits, performance bonuses, priceconcessions and incentives, if any, asspecified in the contract with the customer.
Revenue also excludes taxes collected fromcustomers.
Contract assets are recognised when thereis excess of revenue earned over billings oncontracts. Contract assets are classified asunbilled receivables (only act of invoicing ispending) when there is unconditional rightto receive cash, and only passage of time isrequired, as per contractual terms.Unearned and deferred revenue ("contractliability”) is recognised when there is billingsis in excess of revenues.
In accordance with Ind AS 37 , the Companyrecognises an onerous contract provisionwhen the unavoidable costs of meeting theobligations under a contract exceed theeconomic benefits to be received.
Contracts are subject to modification toaccount for changes in contract specificationand requirements. The Company reviewsmodification to contract in conjunctionwith the original contract, basis which thetransaction price could be allocated to anew performance obligation, or transactionprice of an existing obligation could undergoa change. In the event transaction price isrevised for existing obligation, a cumulativeadjustment is accounted for. The Companydisaggregates revenue from contractswith customers by geography and natureof services.
Use of significant judgements in revenuerecognition
• The Company’s contracts with
customers could include promises totransfer multiple products and servicesto a customer. The Company assessesthe products/services promised ina contract and identifies distinctperformance obligations in the contract.Identification of distinct performanceobligation involves judgement todetermine the deliverables and theability of the customer to benefitindependently from such deliverables.
• Judgement is also required to determinethe transaction price for the contract.The transaction price could be either afixed amount of customer considerationor variable consideration with elementssuch as volume discounts, servicelevel credits, performance bonuses,price concessions and incentives. Thetransaction price is also adjusted for theeffects of the time value of money if thecontract includes a significant financingcomponent. Any consideration payableto the customer is adjusted to thetransaction price, unless it is a paymentfor a distinct product or service fromthe customer. The estimated amount ofvariable consideration is adjusted in thetransaction price only to the extent thatit is highly probable that a significantreversal in the amount of cumulativerevenue recognised will not occur and isreassessed at the end of each reportingperiod. The Company allocates theelements of variable considerations toall the performance obligations of thecontract unless there is observableevidence that they pertain to one ormore distinct performance obligations.
• The Company uses judgement todetermine an appropriate standaloneselling price for a performanceobligation. The Company allocates thetransaction price to each performanceobligation on the basis of the relativestand-alone selling price of each distinctproduct or service promised in thecontract. Where standalone selling priceis not observable, the Company uses theexpected cost plus margin approach toallocate the transaction price to eachdistinct performance obligation.
• The Company exercises judgement indetermining whether the performanceobligation is satisfied at a point in timeor over a period of time. The Company
considers indicators such as howcustomer consumes benefits as servicesare rendered or who controls the assetas it is being created or existenceof enforceable right to payment forperformance to date and alternate useof such product or service, transferof significant risks and rewards to thecustomer, acceptance of delivery bythe customer, etc.
• Contract fulfilment costs are generallyexpensed as incurred except forcertain software licence costs whichmeet the criteria for capitalisation. Theassessment of this criteria requires theapplication of judgement, in particularwhen considering if costs generateor enhance resources to be used tosatisfy future performance obligationsand whether costs are expected to berecovered (Refer note 8).
I nterest income is accounted for using theeffective interest method.
Export benefits are accounted for, in the yearof exports, based on eligibility and whenthere is no uncertainty in receiving the same.Foreign currency gains and losses arereported on net basis
A contract is, or contains, a lease if thecontract conveys the right to control theuse of an identified asset for a period oftime in exchange for consideration. Toassess whether a contract conveys the rightto control the use of an identified asset, theCompany assesses whether:
• the contract involves the use of anidentified asset;
• t he Company has the right to obtainsubstantially all the economic benefitsfrom use of the asset throughout theperiod of use; and
• the Company has the right to direct theuse of the asset
The Company accounts for each leasecomponent within the contract as a leaseseparately from non-lease components ofthe contract and allocates the considerationin the contract to each lease componenton the basis of the relative stand-aloneprice of the lease component and theaggregate stand-alone price of the non¬lease components.
The Company recognises right-of-useasset representing its right to use theunderlying asset for the lease term at thelease commencement date. The cost of theright-of-use asset measured at inceptionshall comprise of the amount of the initialmeasurement of the lease liability adjustedfor any lease payments made at or beforethe commencement date less any leaseincentives received, plus any initial directcosts incurred and an estimate of costs tobe incurred by the lessee in dismantlingand removing the underlying asset orrestoring the underlying asset or site onwhich it is located. The right-of-use assetsis subsequently measured at cost less anyaccumulated depreciation, accumulatedimpairment losses, if any and adjusted forany remeasurement of the lease liability.The right-of-use assets is depreciatedusing the straight-line method from thecommencement date over the shorter oflease term or useful life of right-of-use asset.The estimated useful lives of right-of-useassets are determined on the same basisas those of property, plant and equipment.Right-of-use assets are tested for impairmentwhenever there is any indication that theircarrying amounts may not be recoverable.Impairment loss, if any, is recognised in thestatement of profit and loss.
The Company measures the lease liability atthe present value of the lease payments that
are not paid at the commencement date ofthe lease. The lease payments are discountedusing the interest rate implicit in the lease,i f that ra te can be rea di ly determined. Ifthat rate cannot be readily determined,the Company uses incremental borrowingrate. For leases with reasonably similarcharacteristics, the Company, on a lease bylease basis, may adopt either the incrementalborrowing rate specific to the lease or theincremental borrowing rate for the portfolioas a whole. The lease payments shall includefixed payments, variable lease payments,residual value guarantees, exercise price ofa purchase option where the Company isreasonably certain to exercise that optionand payments of penalties for terminatingthe lease, if the lease term reflects the lesseeexercising an option to terminate the lease.The lease liability is subsequently remeasuredby increasing the carrying amount to reflectinterest on the lease liability, reducingthe carrying amount to reflect the leasepayments made and remeasuring thecarrying amount to reflect any reassessmentor lease modifications or to reflect revised in¬substance fixed lease payments.
The Company recognises the amount ofthe re-measurement of lease liability asan adjustment to the right-of-use asset.Where the carrying amount of the right-of-use asset is reduced to zero and there is afurther reduction in the measurement of thelease liability, the Company recognises anyremaining amount of the re-measurement instatement of profit and loss.
The Company has elected not to recogniseright-of-use assets and lease liabilities forshort-term leases of all assets that have alease term of 12 months or less and leases oflow-value assets. The Company recognizesthe lease payments associated with theseleases as an expense on a straight-line basisover the lease term.
The functional currency of the Company isIndian Rupee.
I ncome and expenses in foreign currenciesa re recorded at excha nge ra tes preva i li ngon the date of the transaction. Foreigncurrency monetary assets and liabilities aretranslated at the exchange rate prevailingon the balance sheet date and exchangegains and losses arising on settlement andrestatement are recognized in the statementof profit and loss.
Non-monetary assets and liabilities thatare measured in terms of historical cost inforeign currencies are not translated.
I ncome tax expense comprises current taxexpense and the net change in the deferredtax asset or liability during the year.Current and deferred tax are recognized instatement of profit or loss, except when theyrelate to items that are recognized in othercomprehensive income or directly in equity,in which case, the current and deferred taxare also recognized in other comprehensiveincome or directly in equity, respectively.Current income taxes
Current income tax for the current andprior periods are measured at the amountexpected to be recovered from or paidto the taxation authorities based on thetaxable income for that period and reflectsthe uncertainty related to income tax, if any.The tax rates and tax laws used to computethe amount are those that are enactedby the balance sheet date. The Companyoffsets current tax assets and current taxliabilities, where it has a legally enforceableright to set off the recognized amounts andwhere it intends either to settle on a netbasis, or to realize the asset and settle theliability simultaneously.
The current income tax expense includesincome taxes payable by the Company
and its branches in India and overseas. Thecurrent tax payable by the Company inIndia is Indian income tax payable for theirworldwide income after taking credit fortax relief available for export operations inSpecial Economic Zones (SEZs).
Current income tax payable by overseasbranches of the Company is computed inaccordance with the tax laws applicablein the jurisdiction in which the respectivebranch operates. The taxes paid aregenerally available for set off against theIndian income tax liability of the Company’sworldwide income.
Advance taxes and provisions for currentincome taxes are presented in the balancesheet after off-setting advance tax paid andincome tax provision arising in the sametax jurisdiction and where the relevant taxpaying units intends to settle the asset andliability on a net basis.
Deferred income taxesDeferred income tax is recognized using thebalance sheet approach. Deferred incometax assets and liabilities are recognized fordeductible and taxable temporary differencesarising between the tax base of assets andliabilities and their carrying amount, exceptwhen the deferred income tax arises fromthe initial recognition of goodwill or anasset or liability in a transaction that is nota business combination and affects neitheraccounting nor taxable profit or loss at thetime of the transaction.
Deferred income tax assets are recognizedto the extent that it is probable that taxableprofit will be available against which thedeductible temporary differences and thecarry forward of unused tax credits andunused tax losses can be utilized.
The carrying amount of deferred incometax assets is reviewed at each reportingdate and reduced to the extent that it isno longer probable that sufficient taxable
profit will be available to allow all or part ofthe deferred income tax asset to be utilized.Deferred tax assets and liabilities aremeasured using substantively enacted taxrates expected to apply to taxable income inthe years in which the temporary differencesare expected to be received or settled.
For operations carried out in SEZs, deferredtax assets or liabilities, if any, have beenestablished for the tax consequences ofthose temporary differences between thecarrying values of assets and liabilities andtheir respective tax bases that reverse afterthe tax holiday ends.
Deferred tax assets and liabilities are offsetwhen they relate to income taxes levied bythe same taxation authority and the relevantentity intends to settle its current tax assetsand liabilities on a net basis.
Minimum Alternative Tax (MAT) paid inaccordance with the tax laws in India, whichis likely to give future economic benefitsin the form of availability of set off againstfuture income tax liability. Accordingly,MAT is recognized as deferred tax asset inthe balance sheet when the asset can bemeasured reliably and it is probable that thefuture economic benefit associated with theasset will be realized.
Special Economic Zone re-investmentA portion of the profits of the Company’sIndia operations are exempt from Indianincome taxes being profits attributableto export operations from undertakingssituated in SEZ. Under the Special EconomicZone Act, 2005 scheme, units in designatedspecial economic zones providing serviceon or after April 1, 2005 will be eligible fora deduction of 100 percent of profits orgains derived from the export of servicesfor the first five years from commencementof provision of services and 50 percentof such profits and gains for a further fiveyears. The tax benefits are also available for
a further five years post the initial ten yearssubject to the creation of SEZ ReinvestmentReserve which is required to be spentwithin 3 financial years in accordance withrequirements of the tax regulations in India.During the year, the Company has created' 2,456,44 lakhs (March 2024 - ' 2,533.58lakhs) as SEZ reinvestment reserve for oneits such unit which entered 12th year ofoperations.
Inventory comprise of computer systemsand software, components and spares.Components and spares are valued at lowerof cost and net realizable value.
Cost is determined on the basis of specificidentification method.
Computer systems and software,components and spares intended forcustomer support are written off over theeffective life of the systems maintained, asestimated by the management.
Financial assets and liabilities are recognizedwhen the Company becomes a party to thecontractual provisions of the instrument.Financial assets and liabilities are initiallymeasured at fair value, except for tradereceivables which are initially measured attransaction price. Transaction costs thatare directly attributable to the acquisitionor issue of financial assets and financialliabilities (other than financial assets andfinancial liabilities at fair value through profitor loss) are added to or deducted from thefair value measured on initial recognition offinancial asset or financial liability.
Cash and cash equivalentsCash comprises cash on hand and demanddeposits with banks. Cash equivalentsare short- term balances (with an originalmaturity of three months or less from thedate of acquisition), highly liquid investments
that are readily convertible into knownamounts of cash and which are subject toinsignificant risk of changes in value.Financial assets at amortized costFinancial assets are subsequently measuredat amortized cost if these financial assetsare held within a business whose objectiveis to hold these assets in order to collectcontractual cash flows and the contractualterms of the financial asset give rise onspecified dates to cash flows that are solelypayments of principal and interest on theprincipal amount outstanding.
Financial assets at fair value through othercomprehensive incomeFinancial assets are measured at fair valuethrough other comprehensive income ifthese financial assets are held within abusiness whose objective is achieved byboth collecting contractual cash flows andselling financial assets and the contractualterms of the financial asset gives rise onspecified dates to cash flows that are solelypayments of principal and interest on theprincipal amount outstanding.
Financial assets are measured at fair valuethrough profit or loss ('FVTPL’’) unless it ismeasured at amortized cost or at fair valuethrough other comprehensive income oninitial recognition. The transaction costsdirectly attributable to the acquisition offinancial assets and liabilities at fair valuethrough profit or loss are immediatelyrecognized in profit or loss.
Financial liabilities at fair value throughprofit or loss
Financial liabilities are classified asmeasured at amortised cost or FVTPL. Afinancial liability is classified as at FVTPLif it is classified as held for trading, or it isa derivative or it is designated as such oninitial recognition. Financial liabilities at
FVTPL are measured at fair value and netgains and losses, including any interestexpense, are recognised in profit or loss.Other financial liabilities are subsequentlymeasured at amortised cost using theeffective interest method. Interest expenseand foreign exchange gains and losses arerecognised in profit or loss. Any gain or losson derecognition is also recognised in profitor loss.
Derivative financial instruments
The Company is exposed to foreign currencyfluctuations on foreign currency assets andliabilities. The Company holds derivativefinancial instruments such as foreignexchange forward contracts to mitigate therisk of changes in exchange rates on foreigncurrency exposures. The counterpartyfor these contracts is generally a bank.Derivatives are recognized and measured atfair value. Attributable transaction costs arerecognized in the statement of profit andloss as expenses. Subsequent changes infair value of such derivative instruments arerecognized in profit or loss.
Offsetting of financial instrumentsFinancial assets and financial liabilities areoffset and the net amounts are presented inthe standalone balance sheet when, and onlywhen, the Company currently has a legallyenforceable right to set off the amounts andit intends either to settle them on a net basisor to realize the asset and settle the liabilitysimultaneously.
DerecognitionFinancial assets
The Company derecognises a financial assetwhen the contractual rights to the cash flowsfrom the financial asset expire, or it transfersthe rights to receive the contractual cashflows in a transaction in which substantiallyall of the risks and rewards of ownershipof the financial asset are transferred or inwhich the Company neither transfers nor
retains substantially all of the risks andrewards of ownership and does not retaincontrol of the financial asset.
If the Company enters into transactionswhereby it transfers assets recognised onits balance sheet, but retains either all orsubstantially all of the risks and rewardsof the transferred assets, the transferredassets are not derecognised.
The Company derecognises a financialliability when its contractual obligations aredischarged or cancelled, or expire.
The Company also derecognises a financialliability when its terms are modified and thecash flows under the modified terms aresubstantially different. In this case, a newfinancial liability based on the modifiedterms is recognised at fair value. Thedifference between the carrying amount ofthe financial liability extinguished and thenew financial liability with modified terms isrecognised in profit or loss.
Property, plant and equipment are statedat costs less accumulated depreciation(other than freehold land) and impairmentloss, if any.
The cost includes purchase price net ofany trade discounts and rebates, anyimport duties and other taxes (other thanthose subsequently recoverable from thetax authorities), any directly attributableexpenditure on making the asset ready forits intended use, other incidental expensesand interest on borrowings attributable toacquisition of qualifying fixed assets up tothe date the asset is ready for its intendeduse. The cost of an item of property, plantand equipment shall be recognised as anasset if, and only if it is probable that futureeconomic benefits associated with the itemwill flow to the Company and the cost of theitem can be measured reliably. Subsequent
expenditure on fixed assets after itspurchase/completion is capitalized onlyif such expenditure results in an increasein the future benefits from such assetbeyond its previously assessed standard ofperformance.
The Company identifies and determinescost of each component/part of property,plant and equipment separately, if thecomponent/part has a cost which issignificant to the total cost of the property,plant and equipment and has useful lifethat is materially different from that of theremaining asset.
An item of property, plant and equipmentand any significant part initially recognisedis derecognised upon disposal or whenno future economic benefits are expectedfrom its use. Gains or losses arising fromde-recognition of property, plant andequipment and intangible assets aremeasured as the difference between the netdisposal proceeds and the carrying amountof property, plant and equipment and arerecognized in the statement of profit andloss when the property, plant and equipmentis derecognized.
Depreciation is provided for property, plantand equipment on the straight-line basisover the estimated useful life from the datethe assets are ready for intended use. Theestimated useful lives, residual values anddepreciation method are reviewed at theend of each reporting period, with the effectof any changes in estimate accounted for ona prospective basis.
The estimated useful life on a straightlinebasis of amortization is mentioned below:
*The Management believes that the usefullives as given below best represents theperiod over which the management expectsto use these assets based on an internalassessment and technical evaluation wherenecessary. Hence, the useful lives of some ofthese assets is different from the useful livesas prescribed under part C of Schedule II ofthe Companies Act.
Leasehold improvements are depreciatedover the lower of the lease term and theiruseful lives.
Advances paid towards the acquisition ofproperty, plant and equipment outstandingat each balance sheet date are disclosedunder 'other assets’. The cost of property,plant and equipment not ready to use beforethe balance sheet date is disclosed under'Capital work in progress’. Subsequentexpenditures relating to property, plantand equipment is capitalized only when itis probable that future economic benefitsassociated with these will flow to theCompany and the cost of the item can bemeasured reliably. The cost and relatedaccumulated depreciation are eliminatedfrom the financial statements upon sale orretirement of the asset.
Changes in the expected useful life or theexpected pattern of consumption of futureeconomic benefits embodied in the assetare considered to modify the amortizationperiod or method, as appropriate, and aretreated as changes in accounting estimates.Capital work-in-progressAmount paid towards the acquisition ofproperty, plant and equipment outstandingas of each reporting date and the cost of
property, plant and equipment not ready forintended use before such date are disclosedunder capital work-in-progress.
The capital work- in-progress is carriedat cost, comprising direct cost, relatedincidental expenses and attributable interest.
I ntangible assets purchased are measuredat cost as of the date of acquisition, asapplicable, less accumulated amortizationand accumulated impairment, if any.Intangible assets are amortized on a straightline basis over their estimated useful livesfrom the date that they are available for use.The estimated useful lives of the intangibleassets and the amortization period arereviewed at the end of each financial yearand the amortization period is revised toreflect the changed pattern, if any.
Employee benefits include contributionto provident fund, superannuation fund,gratuity fund, compensated absences,pension and employee state insurancescheme.
Short-term employee benefits
All employee benefits payable wholly withintwelve months of rendering the service areclassified as short-term employee benefits.Benefits such as salaries, wages etc. and theexpected cost of ex-gratia are recognised inthe period in which the employee rendersthe related service. A liability is recognisedfor the amount expected to be paid whenthere is a present legal or constructiveobligation to pay this amount as a result ofpast service provided by the employee andthe obligation can be estimated reliably.
Gratuity and Pension are defined benefitplans, the cost of providing benefits isdetermined using the Projected Unit CreditMethod, with actuarial valuations, beingcarried out at the date of each balancesheet date. Remeasurement, comprisingactuarial gains and losses, the effect ofthe changes to the asset ceiling and thereturn on plan assets (excluding interest),is reflected immediately in the balancesheet with a charge or credit recognised inother comprehensive income in the periodin which they occur. Past service cost, bothvested and unvested, is recognized asan expense at the earlier of (a) when theplan amendment or curtailment occurs;and (b) when the entity recognises relatedrestructuring costs or termination benefits.The retirement benefit obligationsrecognized in the balance sheet representsthe present value of the defined obligationsreduced by the fair value of schemeassets. Any, asset resulting from thiscalculation is limited to the present valueof available refunds and reductions infuture contributions to the scheme. Undera defined benefit plan, it is the Company’sobligation to provide agreed benefits tothe employees. The related actuarial andinvestment risks fall on the Company.Defined contribution plansContributions to defined contribution planslike provident fund and superannuation,funds are recognized as expense whenemployees have rendered services entitlingthem to such benefits.
Compensated absencesCompensated absences which are expectedto occur within twelve months after theend of the period in which the employeerenders the related services are stated asundiscounted liability at the balance sheetdate. Compensated absences which are not
expected to occur within twelve monthsafter the end of the period in which theemployee renders the related servicesare stated as an actuarially determinedliability at the present value of the definedbenefit obligation at the balance sheet date.Actuarial gains/losses are immediatelytaken to the statement of profit and loss.Share based paymentsThe Company measures compensation costrelating to share-based payments usingthe fair valuation method in accordancewith Ind AS 102, Share Based Payment.Compensation expense is amortized overthe vesting period of the option on agraded basis. The units generally vest in agraded manner over the vesting period.The fair value determined at the grant dateis expensed over the vesting period of therespective tranches of such grants.
The cost of equity-settled transactions isdetermined by the fair value at the date whenthe grant is made using the Black-Scholesvaluation model. Expected volatility duringthe expected term of the option is based onthe historical volatility of share price of theCompany. Risk free interest rates are basedon the government securities yield in effectat the time of the grant.
The cost of equity settled transactions isrecognised, together with a correspondingincrease in share-based payment reservein equity, over the period in which theperformance and/or service conditions arefulfilled. The cumulative expense recognisedfor equity-settled transactions at eachreporting date until the vesting date reflectsthe extent to which the vesting period hasexpired and the Company’s best estimate ofthe number of equity instruments that willultimately vest. Debit or credit in statementof profit and loss for a period representsthe movement in cumulative expenserecognized as at the beginning and end of
that period and is recognized in employeebenefits expense.
The dilutive effect of outstanding optionsis reflected in the computation of dilutedearnings per share.
Basic earnings per share is computedby dividing profit or loss attributable toequity shareholders of the Company by theweighted average number of equity sharesoutstanding during the year.
Diluted Earnings Per ShareDiluted earnings per share is computedby dividing the profit (considered indetermination of basic earnings per share)after considering the effect of interestand other financing costs or income (netof attributable taxes) associated withdilutive potential equity shares by theweighted average number of equity sharesconsidered for deriving basic earnings pershare adjusted for the weighted averagenumber of equity shares that would havebeen issued upon conversion of all dilutivepotential equity shares.
Financial assets (other than those carriedat fair value)
The Company assesses at each date ofbalance sheet whether a financial asset ora group of financial assets is impaired. IndAS 109 requires expected credit losses tobe measured through a loss allowance. TheCompany recognizes lifetime expectedlosses for all contract assets and/or alltrade receivables that do not constitute afinancing transaction. For all other financialassets, expected credit losses are measuredat an amount equal to the 12 month expectedcredit losses or at an amount equal to thelife time expected credit losses if the credit
risk on the financial asset has increasedsignificantly since initial recognition.Non-financial assets
Property, plant and equipment andIntangible assets
Property, plant and equipment and
intangible assets with finite life are evaluatedfor recoverability whenever there is anyindication that their carrying amounts maynot be recoverable. If any such indicationexists, the recoverable amount (i.e. higher ofthe fair value less cost to sell and the value-in-use) is determined on an individual assetbasis unless the asset does not generatecash flows that are largely independent ofthose from other assets. In such cases, therecoverable amount is determined for thecash generating unit (CGU) to which theasset belongs.
If the recoverable amount of an asset(or CGU) is estimated to be less than itscarrying amount, the carrying amount of theasset (or CGU) is reduced to its recoverableamount. An impairment loss is recognized inthe statement of profit and loss.
Ministry of Corporate Affairs ("MCA”)notifies new standard or amendments tothe existing standards under Companies(Indian Accounting Standards) Rules asissued from time to time. For the year endedMarch 31, 2025, MCA has notified Ind AS -117 Insurance Contracts and amendmentsto Ind AS 116 - Leases, relating to sale andleaseback transactions, applicable to theCompany w.e.f. April 1, 2024. The Companyhas reviewed the new pronouncements andbased on its evaluation has determinedthat it does not have any significant impactin its financial statements. standards oramendments to the existing standardsapplicable to the Company.
The tax rate used for 2024-25 reconciliation above is the corporate tax rate of 34.944% (PY 34.944%)payable by corporate entities in India on taxable profits under Indian tax law.
The Company benefits from the tax holiday available for units set up under the Special Economic ZoneAct, 2005. These tax holidays are available for a period of fifteen years from the date of commencementof operations. Under the SEZ scheme, the units which begins providing services on or after April 1, 2005will be eligible for deductions of 100% of profits or gains derived from export of services for the first fiveyears, 50% of such profit or gains for a further period of five years and 50% of such profits or gains for thebalance period of five years subject to fulfilment of certain conditions. Pune unit 1, Thiruvananthapuram,Chennai unit and Pune Unit 2, will be eligible for deductions of 100% of profits or gains derived from exportof services for the first five years, 50% of such profit or gains for a further period of five years and 50% ofsuch profits or gains for the balance period of five years subject to fulfilment of certain conditions.
The Company makes contribution to Provident Fund, Superannuation Fund and Employee StateInsurance fund for qualifying employees. Under the Schemes, the Company is required to contribute aspecified percentage of the payroll costs to fund the benefits.
The Company recognised i) ' 5,408.21 lakhs and ' 4,846.56 lakhs for Provident Fund contributionsfor the year ended March 31, 2025 and March 31, 2024, respectively. ii) ' 1,116.80 lakhs and ' 1,083.33lakhs for Superannuation Fund contributions for the year ended March 31, 2025 and March 31, 2024,respectively. The contributions payable to these plans by the Company are at the rates specified in therules of the schemes.
The Company offers gratuity (included as part of Contribution to Provident and other funds in Note 25Employee benefit expenses) to its eligible employees under defined benefit plans.
The gratuity plan provides for a lump sum payment to vested employees at retirement, death whilein employment or on termination of employment of an amount equivalent to 15 days basic salarypayable for each completed year of service. Vesting occurs upon completion of five continuous yearsof service. The gratuity fund is managed by third party fund (Life Insurance Corporation of India).
Future mortality assumptions are taken based on the published statistics by the Insurance Regulatory andDevelopment Authority of India.
The expected benefits are based on the same assumptions as are used to measure the Company’s definedbenefit plan obligations as at March 31, 2025. The Company is expected to contribute ' 3,662.42 lakhs todefined benefit obligations funds for the year ended March 31, 2026.
The discount rate is based on the prevailing market yields of Government of India securities as at the Balancesheet date for the estimated term of the obligations. The estimate of future salary increases considered, takesinto account the inflation, seniority, promotion, increments and other relevant factors.
The significant actuarial assumptions for the determination of the defined benefit obligations are discount rate,expected salary increase and employee attrition. The sensitivity analysis below have been determined based onreasonably possible changes of the respective assumptions occurring at the end of the reporting period, whileholding all other assumptions constant.
If the discount rate increases (decreases) by 1%, the defined benefit obligations would decrease by ' 704.15lakhs (increase by ' 806.16 lakhs) as at March 31, 2025. If the expected salary growth increases (decreases) by1%, the defined benefit obligations would increase by ' 805.03 lakhs (decrease by ' 715.81 lakhs) as at March 31,2025. If the employee attrition rate increases (decreases) by 1%, the defined benefit obligation would decreaseby ' 3.60 lakhs (decrease by ' 2.01 lakhs).
The sensitivity analysis has been performed based on reasonably possible changes of the respective assumptionsoccurring at the end of the reporting period, while holding all other assumptions constant.
The sensitivity analysis presented above may not be representative of the actual change in the defined benefitobligations as it is unlikely that the change in assumptions would occur in isolation of one another as some ofthe assumption may be correlated.
Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligationshas been calculated using the Projected Unit Credit Method at the end of the reporting period, which is thesame as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.There was no change in the methods and assumptions used in preparing the sensitivity analysis from prioryears.
Each year an Asset - Liability matching study is performed in which the consequences of the strategic investmentpolicies are analysed in terms of risk and return profiles. Investment and contribution policies are integratedwithin this study.
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair valuethat are either observable or unobservable and consists of the following three levels:
• Level 1 - Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
• Level 2 - Inputs are other than quoted prices included within Level 1 that are observable for theasset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
• Level 3 - Inputs are not based on observable market data (unobservable inputs). Fair values aredetermined in whole or in part using a valuation model based on assumptions that are neithersupported by prices from observable current market transactions in the same instrument nor arethey based on available market data.
The investments included in Level 2 of fair value hierarchy have been valued using quotes availablefor similar assets and liabilities in the active market. The investments included in Level 3 of fair valuehierarchy have been valued using the cost approach to arrive at their fair value. The cost of unquotedinvestments approximate the fair value because there is a range of possible fair value measurementsand the cost represents estimate of fair value within that range.
The following table summarises financial assets and liabilities measured at fair value on a recurring basisand financial assets that are not measured at fair value on a recurring basis (but fair value disclosuresare required):
The Company is exposed primarily to fluctuations in credit, liquidity and market risks, which mayadversely impact the fair value of its financial instruments. The Company has a risk management policywhich covers risks associated with the financial assets and financial liabilities. The risk managementpolicy is approved by the Board of Directors. The focus of risk management committee is to assess theunpredictability of the financial environment and to mitigate potential adverse effects on the financialperformance of the Company.
(d) Interest rate risk
The Company’s investments are primarily in fixed rate interest bearing fixed deposits with banks. Hencethe Company is not significantly exposed to interest rate risk.
Credit risk is the risk of financial loss arising from counter party failure to repay or service debtaccording to the contractual terms or obligations. Credit risk encompasses of both, the direct risk ofdefault and the risk of deterioration of creditworthiness as well as concentration of risks. Credit risk iscontrolled by analyzing credit limits and creditworthiness of customers on a continuous basis to whomthe credit has been granted after necessary approvals for credit.
Financial instruments that are subject to concentrations of credit risk principally consist of tradereceivables, unbilled revenue, derivative financial instruments, cash and cash equivalents, other bankbalances and other financial assets. Other bank balances include bank deposits include an amountof ' 1,58,310 lakhs (Previous year ' 1,36,400.00 lakhs) held with four scheduled banks having highcredit-rating which are individually in excess of 10% or more of the Company bank deposits for theyear ended March 31, 2025. Trade receivables- billed and Trade receivables-unbilled include an amountof ' 26,559.60 lakhs (Previous year ' 22,967.74 lakhs) held with two customers having high credit¬rating which are individually in excess of 10% or more of Company Trade receivables- billed and Tradereceivables- unbilled for the year ended March 31, 2025.
The carrying amount of financial assets represents the maximum credit exposure. The maximumexposure to the credit risk was ' 3,00,238.66 lakhs and ' 2,57,976.60 lakhs as at March 31, 2025 andMarch 31, 2024, respectively, being the total of the carrying amount of balances principally with banks,other bank balances, Trade receivables- billed and Trade receivables- unbilled and other financial assets.The Company’s exposure to customers is diversified and except two customers, no single customercontributes to more than 10% and 10% of Trade receivables- billed and Trade receivables- unbilled asat March 31, 2025 and March 31, 2024, respectively.
The Company also has a geographic concentration of Trade receivables- billed and Trade receivables¬unbilled (gross and net of allowances) as given below:
Liquidity risk refers to the risk that Company cannot meet its financial obligations. The objective ofliquidity risk management is to maintain sufficient liquidity and to ensure that sufficient funds areavailable for use as per requirements.
The Company consistently generates sufficient cash flows from operations to meet its financialobligations as and when they fall due.
The table below provides details regarding the contractual maturities of significant financial liabilitiesas at March 31, 2025
(a) Foreign currency exchange rate risk:
The fluctuation in foreign currency rates may have potential impact on the statement of profit orloss and other comprehensive income and equity, where any transaction references more thanone currency or where assets/liabilities are denominated in a currency other than the functionalcurrency of the Company.
Considering the countries and economic environment in which the Company operates, itsoperations are subject to risks arising from fluctuations in exchange rates in those countries.The risks primarily relate to fluctuations in US Dollar, Great Britain Pound and Euro against thefunctional currency of the Company.
The Company, as per its risk management policy, uses derivative instruments primarily to cover theexchange rate risks. Further, any movement in the foreign currency of the various operations of theCompany against major foreign currencies may impact Company’s revenue in international business.The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposureto exchange risk. It covers a part of these risks by using derivative financial instruments in line withits risk management policies.
The foreign exchange rate sensitivity is calculated by aggregation of the net foreign exchangerate exposure and a simultaneous parallel foreign exchange rates shift of all the currencies by 10%against the functional currency of the Company.
The following analysis has been worked out based on the net exposures of the Company as of thedate of balance sheet which could affect the statement of profit and loss and other comprehensiveincome and equity. Further the exposure indicated below is mitigated by some of the derivativecontracts entered into by the Company.
The following table sets forth information relating to foreign currency exposures as at March 31,2025 and March 31, 2024.
1 0% appreciation/depreciation of the respective foreign currencies with respect to functionalcurrency of the Company would result in decrease/increase in the Company’s profit before tax byapproximately ' 6,635.62 lakhs for the year ended March 31, 2025 and ' 7,427.54 lakhs for the yearended March 31, 2024 respectively.
-Others include AED, AUD, CAD, JPY, KRW, MYR, SGD, ZAR etc.
The Company uses various derivative financial instruments governed by policies approved by theboard of directors such as foreign exchange forward and option contracts to manage and mitigateits exposure to foreign exchange rates. The counter party is generally a bank. The Company canenter into contracts for period up to one year.
The following table presents the aggregate contracted principal amounts of the Company’sderivative contracts outstanding:
During the years ended March 31, 2025 and March 31, 2024'23,474.13 and ' 14,461.10 of unbilledrevenue (including Contract assets) pertaining to fixed price and fixed time frame contracts as ofApril 01, 2024 and April 01, 2023, respectively, has been reclassified to trade receivables upon billingto customers on completion of milestones. During the years ended March 31, 2025 and March 31, 2024the Company recognised revenue of ' 5,276.56 and ' 4,203.83 arising from opening uneared revenueas of April 01, 2024 and April 01, 2023, respectively.
The remaining performance obligation disclosure provides the aggregate amount of the transactionprice yet to be recognised as at the end of the reporting period and an explanation as to when theCompany expects to recognise these amounts in revenue. Remaining performance obligation estimatesare subject to change and are affected by several factors, including terminations, changes in the scopeof contracts, periodic revalidations, adjustment for revenue that has not materialised and adjustmentsfor currency.
Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the remainingperformance obligation related disclosures for contracts where the revenue recognised correspondsdirectly with the value to the customer of the Company’s performance completed to date, typicallythose contracts where invoicing is on time and material, unit price basis and no information is providedabout remaining performance obligations at March 31, 2025 that have an original expected duration ofone year or less, as allowed by Ind AS 115.
The aggregate value of performance obligations that are completely or partially unsatisfied as ofMarch 31, 2025 is ' 18,656.24 lakhs (March 31, 2024: ' 48,798.43 lakhs). Out of this, the Companyexpects to recognise revenue of around 89.97% (March 31, 2024: 50.60%) within the next one yearand the remaining thereafter. This includes contracts that can be terminated for convenience withouta substantive penalty since, based on current assessment, the occurrence of the same is expected tobe remote.
Dues to micro and small enterprises have been determined to the extent such parties have been identifiedon the basis of information collected by the Management.
The Chief Executive Officer and Managing Director of the Company has been identified as the ChiefOperating Decision Maker (CODM) as defined by Ind AS 108 - operating segments. The CODM evaluates theCompany’s performance and allocates resources based on an analysis of various performance indicators byindustry classes. Accordingly, the segment information has been presented for industry classes.
The Company has identified business segments as its primary segment. Business segments are primarilysystem integration & support and software development & services.
Each segment item reported is measured at the measure used to report to the CODM for the purposes ofmaking decisions about allocating resources to the segment and assessing its performance.
Revenues and expenses directly attributable to segments are reported under each reportable segment. All otherexpenses which are not attributable or allocable to segments have been disclosed as unallocable expenses.Assets and liabilities of the Company are used interchangeably amongst segments. Allocation of such assetsand liabilities is not practicable and any forced allocation would not result in any meaningful segregation.Hence, assets and liabilities have not been identified to any of the reportable segments.
The revenues of ' 3,62,329.70 lakhs (Previous year ' 3,45,625.73 lakhs) arising from the software developmentand services segment includes ' 1,35,323.92 lakhs (Previous year ' 1,13,865.89 lakhs) representing revenueof more than 10% of the total revenue of the Company is from two customers.
Performance Stock Option Plan (PSOP) - 2023 (the Plan)
Effective March 04, 2023, the Company instituted the Plan. The Board of Directors of the Company andshareholders authorised to introduce, offer, issue and provide share based options to eligible employeesof the Company at its meeting held on January 25, 2023 and March 04, 2023 respectively. The maximumnumber of shares under the 2023 plan shall not exceed 3,11,000 equity shares. Further, the maximumnumber of Options that can be granted to any specific Employee during the tenure of this Plan shall notexceed 20,000 Options.
The options would vest on achievement of defined performance parameters as determined by Nominationand Remuneration committee. The performance parameters are based on operating performance metricsof the Company as decided by Nomination and Remuneration committee. Each of the performanceparameters will be distinct for the purpose of calculation of the quantity of the shares to vest based on
43. The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributionsby the Company towards Provident Fund and Gratuity. The Ministry of Labour and Employment hadreleased draft rules for the Code on Social Security, 2020 on November 13, 2020, and invited suggestionsfrom stakeholders which are under consideration by the Ministry. The Company will assess the impact andits evaluation once the subject rules are notified. The Company will give appropriate impact in its financialstatements in the period in which, the Code becomes effective and the related rules to determine thefinancial impact are published.
The Company does not have any benami property, where any proceeding has been initiated or pendingagainst the Company for holding any Benami property.
The Company has not traded or invested in Crypto currency or Virtual currency during the financial year.
The Company has not any such transaction which is not recorded in the books of accounts that has beensurrendered 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).
The Company has not been declared wilful defaulter by any bank or financial institution or government orany government authority.
44. No funds have been advanced/loaned/invested (from borrowed funds or from share premium or from anyother sources/kind of funds) by the Company to any other person(s) or entity(ies), including foreign entities(Intermediaries), with the understanding (whether recorded in writing or otherwise) that the Intermediaryshall (i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoeverby or on behalf of the Company (Ultimate Beneficiaries) or (ii) provide any guarantee, security or the liketo or on behalf of the Ultimate Beneficiaries.
No funds have been received by the Company from any person(s) or entity(ies), including foreign entities(Funding Parties), with the understanding (whether recorded in writing or otherwise) that the Companyshall (i) directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoeverby or on behalf of the Funding Party (Ultimate Beneficiaries) or (ii) provide any guarantee, security or thelike on behalf of the Ultimate Beneficiaries.
On April 17, 2025, the Board of Directors of the Company have proposed a dividend of ' 75.00 per sharein respect of the year ended March 31, 2025 subject to the approval of shareholders at the Annual GeneralMeeting.
For B S R & Co. LLP
Chartered Accountants N G Subramaniam Manoj Raghavan
Firm Registration No.: 101248W/W-100022 Chairman Managing Director
DIN: 07006215 DIN: 08458315
Ashish Chadha
Partner Gaurav Bajaj Cauveri Sriram
Membership No.: 500160 Chief Financial Officer Company Secretary