Notes to Accounts of Alok Industries Ltd.

Mar 31, 2025

l) Provisions and contingent liabilities:

Provisions are recognised when the Company
has a present obligation (legal or constructive)
as a result of a past event, it is probable that the
Company will be required to settle the obligation,
and a reliable estimate can be made of the amount
of the obligation.

The amount recognised as a provision is the best
estimate of the consideration required to settle the
present obligation at the end of the reporting period,
taking into account the risks and uncertainties
surrounding the obligation. When a provision is
measured using the cash flows estimated to settle
the present obligation, its carrying amount is the
present value of those cash flows (when the effect
of the time value of money is material). When
discounting is used, the increase in the provision
due to the passage of time is recognised as a
finance cost.

When some or all of the economic benefits required
to settle a provision are expected to be recovered
from a third party, a receivable is recognised as an

asset if it is virtually certain that reimbursement
will be received and the amount of the receivable
can be measured reliably.

A contingent liability is:-

a) a possible obligation that arises from past
events and whose existence will be confirmed
only by the occurrence or non-occurrence of
one or more uncertain future events not wholly
within the control of the entity; or

b) a present obligation that arises from past
events but is not recognised because:-

i) it is not probable that an outflow of
resources embodying economic benefits
will be required to settle the obligation; or

ii) the amount of the obligation cannot be
measured with sufficient reliability.

Contingent liability is disclosed in the case of:

• a present obligation arising from past events,
when it is not probable that an outflow of
resources will be required to settle the
obligation;

• a present obligation arising from past events,
when no reliable estimate is possible;

• a possible obligation arising from past events,
unless the probability of outflow of resources
is remote.

A contingent asset is disclosed where an inflow of
economic benefits is probable.

Provisions, contingent liabilities and contingent
assets are reviewed at each balance sheet date

m) Retirement and other employee benefits:

Post-employment benefits

• Payments to defined contribution benefit
plans are recognised as an expense when
employees have rendered service entitling
them to the contributions. For defined benefit
retirement plans, the cost of providing benefits
is determined using the projected unit credit
method, with actuarial valuations being
carried out at the end of each annual reporting
period. Remeasurement, comprising actuarial
gains and losses, the effect of the changes to
the asset ceiling (if applicable) and the return

on plan assets (excluding net interest), is
reflected immediately in the balance sheet
with a charge or credit recognised in other
comprehensive income in the period in which
they occur. Remeasurement recognised in
other comprehensive income is not reclassified
to statement of profit and loss. Past service
cost is recognised in statement of profit and
loss in the period of a plan amendment. Net
interest is calculated by applying the discount
rate at the beginning of the period to the net
defined benefit liability or asset. Defined
benefit costs are categorised as follows:

• Service cost (including current service cost,
past service cost, as well as gains and losses
on curtailments and settlements);

• Net interest expense or income; and

• Re-measurement.

The Company presents the first two components
of defined benefit costs in statement of profit and
loss in the line item "Employee benefits expense”,
and the last component in Other Comprehensive
Income. Curtailment gains and losses are
accounted for as past service costs.

The retirement benefit obligation recognised in
the balance sheet represents the actual deficit
or surplus in the Company''s defined benefit
plans. Any surplus resulting from this calculation
i s limited to the present value of any economic
benefits available in the form of refunds from the
plans or reductions in future contributions to the
plans.

Terminal benefits

A liability for a termination benefit is recognised at
the earlier of when the entity can no longer withdraw
the offer of the termination benefit and when the
entity recognises any related restructuring costs.

Short-term and other long-term employee
benefits

A liability is recognised for benefits accruing
to employees in respect of wages and salaries,
performance incentives and similar benefits other
than compensated absences in the period the
related service is rendered at the undiscounted
amount of the benefits expected to be paid in
exchange for that service.

Liabilities recognised in respect of compensated
absences are measured on the basis of actuarial
valuation as on the balance sheet date.

Liabilities recognised in respect of other long-term
employee benefits are measured at the present
value of the estimated future cash outflows
expected to be made by the Company in respect of
services provided by employees up to the reporting
date.

n) Earnings per share:

Basic earnings per share is calculated by dividing
the profit/loss attributable to the owners of the
Company by the weighted average number of
equity shares outstanding during the financial year.

Diluted earnings per share adjusts the figure used
in determination of basic earnings per share to take
into account the after income tax effect of interest
and other financing costs associated with dilutive
potential equity shares, and the weighted average
number of additional equity shares that would have
been outstanding assuming the conversion of all
dilutive potential equity shares.

o) Operating segment

Identification of segment - Operating segments
are reported in the manner consistent with the
internal reporting provided to the Chief Operating
Decision Maker (CODM) of the Company.

Segment accounting policies - The Board of
Directors of the Company have been identified as
the Chief Operating Decision Maker (CODM) as
defined under Ind AS 108. CODM reviews overall
financial information of the Company together for
performance evaluation and allocation of resources
and does not review any discrete information to
evaluate performance of any individual product or
geography.

The Company prepares its segment information
in conformity with accounting policies adopted for
preparing and presenting the financial statements
of the Company as a whole.

p) Onerous contracts

If the Company has a contract that is onerous, the
present obligation under the contract is recognised
and measured as a provision. However, before

a separate provision for an onerous contract
is established, the Company recognises any
impairment loss that has occurred on assets
dedicated to that contract.

An onerous contract is a contract under which the
unavoidable costs (i.e., the costs that the Company
cannot avoid because it has the contract) of meeting
the obligations under the contract exceed the
economic benefits expected to be received under
it. The unavoidable costs under a contract reflect
the least net cost of exiting from the contract,
which is the lower of the cost of fulfilling it and any
compensation or penalties arising from failure to
fulfil it. The cost of fulfilling a contract comprises
the costs that relate directly to the contract (i.e.,
both incremental costs and an allocation of costs
directly related to contract activities).

q) Key sources of estimation uncertainty and critical
accounting judgements

In the course of applying the accounting policies, the
Company is required to make judgements, estimates
and assumptions about the carrying amount of
assets and liabilities that are not readily apparent
from other sources. The estimates and associated
assumptions are based on historical experience
and other factors that are considered to be relevant.
Actual results may differ from these estimates.
The estimates and underlying assumptions
are reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the period
in which the estimate is revised if the revision
affects only that period, or in the period of the
revision and future period, if the revision affects
current and future periods.

Key sources of estimation uncertainty

a) Useful lives of property, plant and equipment,
intangible assets, investment property and
right-of-use assets

Management reviews the useful lives of
property, plant and equipment at least once
a year. Such lives are dependent upon an
assessment of both the technical lives of the
assets and also their likely economic lives
based on various internal and external factors
including relative efficiency and operating
costs. Refer Note 2 and 30 for further
disclosure.

b) Property, plant and equipment, intangible
assets and investment property

Determining whether the property, plant and
equipment are impaired requires an estimate
in the value in use of cash generating units.
It requires to estimate the future cash flows
expected to arise from the cash generating
units and a suitable discount rate in order to
calculate present value. When the present
value of the cash flows are less than carrying
value of property, plant and equipment a
material impairment loss may arise. Refer
Note 2 for further disclosure.

c) Impairment of investments in and loan given
to subsidiaries and joint ventures

Determining whether the investments in and
loan given to subsidiaries and joint ventures
are impaired requires an estimate of the
value in use / recoverable amount of assets.
In considering the value in use / recoverable
amount of assets, the Management have
anticipated the future cash flows, discount
rates and other factors of the underlying
businesses/companies. In certain cases, the
Company engages third party qualified valuers
to perform the valuation. The management
works closely with the qualified external
valuers to establish the appropriate valuation
techniques and inputs to the model. Refer
Note 5, 6, and 39 for further disclosure.

d) Provisions, liabilities and contingencies

Provisions and liabilities are recognized in the
period when it becomes probable that there will
be a future outflow of funds resulting from past
events that can reasonably be estimated. The
timing of recognition requires application of
judgement to existing facts and circumstances
which may be subject to change.

In the normal course of business, contingent
liabilities may arise from litigation and
other claims against the Company. Potential
liabilities that are possible but not probable of
an outflow of resources embodying economic
benefits are treated as contingent liabilities.
Such liabilities are disclosed in the notes but
are not recognized. Refer Note 37 for further
disclosure.

e) Taxes

Deferred tax assets are recognized for unused
tax losses to the extent that it is probable
that taxable profit will be available against
which the losses can be utilized. Significant
management judgement is required to
determine the amount of deferred tax assets
that can be recognised, based upon the likely
timing and the level of future taxable profits
together with future tax planning strategies.
Refer Note 8 for further disclosure.

f) Employee benefit plans

The cost of defined benefit gratuity plan
and other post-employment benefits are
determined using actuarial valuations. An
actuarial valuation involves making various
assumptions that may differ from actual
developments in the future. These include
the determination of the discount rate, future
salary increases and mortality rates. Due
to the complexities involved in the valuation
and its long-term nature, a defined benefit
obligation is highly sensitive to changes in
these assumptions. All assumptions are
reviewed at each reporting date.

The mortality rate is based on publicly
available mortality tables for India. Those
mortality tables tend to change only at interval
in response to demographic changes. Future
salary increases and gratuity increases are
based on expected future inflation rates. Refer
Note 28 and 41 for further disclosure.

g) Recoverability of trade receivables

Judgements are required in assessing the
recoverability of overdue trade receivables and
determining whether a provision against those
receivables is required. Factors considered
i nclud e the cred it rati ng of the counterparty,
the amount and timing of anticipated future
payments and any possible actions that can
be taken to mitigate the risk of non-payment.
Refer note 11 for further disclosure.

h) Inventories

Inventories are reviewed on a regular basis
and the Company make allowance for aged
or obsolete inventories and write down to net
realizable value primarily based on historical
trends and management estimates of expected
and future product demand and related pricing.
Inventories are stated at the lower of cost and
net realisable value. Judgements are required
in assessing the expected realisable values
of Inventories. Factors considered includes
demand levels and pricing competition in the
industry. Refer note 10 for further disclosure.

i) Changes in accounting policies and
disclosures

New and amended standards

The Company applied for the first-time
certain standards and amendments, which
are effective for annual periods beginning on
or after 1 April 2024. The Company has not
early adopted any standard, interpretation or
amendment that has been issued but is not yet
effective.

The Ministry of Corporate Affairs has notified
Companies (Indian Accounting Standards)
Amendment Rules, 2024 to amend the
following Ind AS which are effective for annual
periods beginning on or after 1 April 2024.

(i) Ind AS 117 Insurance Contracts

These amendments had no significant
impact on the accounting policies and
disclosure made in the standalone
financial statements of the Company.

% change during the year 2024-25 - Nil

Reliance Industries Limited and JM Financial Asset Reconstruction Company Limited (acting in its capacity as

Trustee of JMFARC-March 2018-Trust) are also the only promoters of the Company.

(iii) Rights, preferences and restrictions attached to equity shares

i) The Company has one class of equity shares having a par value of 1 per share. Each holder of equity share is
entitled to one vote per share.

ii) Right to receive dividend as may be approved by the Board of Directors / Annual General Meeting.

iii) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms
of the provisions of the Companies Act, 2013.

iv) Every member of the Company holding equity shares has a right to attend the General Meeting of the Company
and has a right to vote in proportion to his share of the paid-up capital of the Company.

v) In the event of liquidation, the equity shareholders are eligible to receive remaining assets of the Company, after
distribution of all preferential amounts, in proportion to their shareholding.

Notes:

(i) Optionally Convertible Preference Shares :

During the earlier year, as per the Approved Resolution Plan, On 28th February 2020, the Company has issued and
allotted 250,00,00,000 9% Optionally Convertible Preference Shares (OCPS) of Re. 1/- each to Reliance Industries
Limited (RIL). (i) RIL is entitled to convert these OCPS into equity shares of the Company (1:1 basis) at any time on or
before 18 months from their date of allotment i.e. 28th February 2020. (ii) if RIL does not convert the OCPS into equity
shares with in the period of 18 months, OCPS shall be redeemed at the end of 10 years from the date of allotment. (iii)
dividend @9% per annum is payable on cumulative basis.

(ii) Non-Convertible Redeemable Preference Shares :

During the previous year, the Company has issued and allotted 3300,00,00,000 9% Non-Convertible Redeemable
Preference Shares (NCRPS) of Re. 1/- each to Reliance Industries Limited(RIL). (i) These NCRPS shall be redeemable
at par at any time at the option of the Company within a period not exceeding 20 years from the date of allotment i.e.
2 January 2024. (ii) dividend @9% per annum is payable on cumulative basis.

Note a - Term loans from Banks are repayable in 28 quarterly instalments commencing from March 2026.

Note b - As per the approved resolution plan, loans from asset reconstruction company and body corporate are
interest free for a period of 8 years, post which the terms of the assigned debt shall be mutually agreed
among the resolution applicants and the Company (Refer note 34).

(v) During the earlier year (FY 2020-21), in accordance with the Approved Resolution Plan, JMFARC Limited and Reliance
Industries Limited have converted debt amounting to '' 5,298.58 crore into equity, whereby the Company has issued
2,75,46,00,000 equity shares at face value '' 275.46 crore, (refer note 15).

(vi) iany has satisfied all the covenants prescribed in the terms of borrowings.

Notes :

(1) Working capital loans are secured by; (i) first ranking pari-passu charge on the current assets of the Company,
both present and future (ii) second ranking pari-passu charge (after term loan) over the movable fixed assets of the
Company, both present and future. (iii) loan is repayable on demand and carrying interest 7% to 9.5% per annum.

(2) The Company has been sanctioned working capital limits in excess of '' five crores in aggregate from banks during
the year on the basis of security of current assets of the Company. The quarterly returns/statements filed by the
Company with such banks are in agreement with the books of account of the Company.

(3) As at 31 March 2025, the Company had available '' 154.76 crores (Previous Year: 123.75 crores) of undrawn committed
borrowing facilities.

(4) The Company has satisfied all the covenants prescribed in the terms of borrowings.

Performance Obligation

The performance obligation is satisfied upon delivery of the goods and payment is generally due within upto 90 days from
delivery. There are no material unsatisfied performance obligation outstanding at the year end.

The performance obligations of the Company are part of contracts that have an original expected duration of less than
one year and accordingly, the Company has applied the practical expedient and opted not to disclose the information
about it''s remaining performance obligations in accordance with IND AS 115.

a. On July 12, 2024, certain spinning plants of the Company located at Silvassa was struck with tornado, causing
damage to certain assets of the Company. Basis preliminary assessment, management has assessed loss of '' 61.42
crore due to above and recorded a loss relating to property, plant and equipment (as per WDV) and inventories under
the head exceptional items. The Company is of the view that it has adequately covered its assets by insurance policy

and the surveyor''s assessment is in progress, Company has already received on account payment of '' 55 crore
from the Insurance company. Since there is certainty on recovery of loss from insurance company, the Company has
recorded the entire amount of loss as insurance claim receivables under the head exceptional items .

b. During the year, the Company has sold certain Investment properties, leasehold land and building situated at
Mumbai, Pawne and Mahape which resulted into a gain of '' 94.14 crore.

33 In the earlier year, the Company has completed all the steps as laid down in the resolution plan approved by the National
Company Law tribunal vide its order dated 8 March 2019 and the resolution applicants had obtained joint control over
the Company and the Board of Directors had been re-constituted on 14 September 2020, being the closing date as
determined by the Company in terms of the resolution plan.

During the year, the Company incurred a loss of '' 768.81 crore for the year ended 31 March 2025 and has accumulated
losses of '' 22,868.40 crore as on that date, its current assets exceeds its current liabilities by '' 350.70 crore and it has
earned EBITDA of '' 136.69 crore for the year ended 31 March 2025. The market condition is improving and considering
the cash flow projection of the Company, the financial statements have been prepared on a going concern basis.

34 As per Clause 1.2 (xi) of Approved Resolution Plan, the outstanding debt amounting to Rs 17,384.02 crore assigned to
Resolution Applicants shall not carry interest for the first 8 years from the Closing Date (as defined in the Approved
Resolution Plan), hence such debt has been measured at cost. After such period of 8 years, the terms of assigned debt
shall be mutually agreed among the Resolution Applicants and the Company. The Approved Resolution Plan has an
overriding effect on the requirements of Ind AS, as per legal view obtained by the Company in this regard. Hence, had the
Company applied the Ind AS, it would have recognised the assigned debt at its fair value and accordingly recognized the
imputed interest cost over the period of loan in the statement of profit and loss.

35 As on June 2017, the Company had an amount of ''11,623.94 crore receivable from trading debtors on account of sale
of fabric ("Outstanding Trading Dues”). As at 31 March 2019, the Company had created full provision against said
receivables by charging it to the statement of profit and loss in earlier year As per the Approved Resolution Plan, if any
of the trading debtors make payment towards the Outstanding Trading Dues or any person is required to contribute to
the assets of the Company under any legal process against the Outstanding Trading Dues and has contributed the same,
such amounts (net of any income tax payable by the Company on account of such receipt of the Outstanding Trading
Dues) shall be deposited in a designated escrow account ("Escrow Account") to be opened in the name of the Company.
Provided however, nothing contained in the resolution plan shall oblige the Resolution Applicants or the Company to take
steps for recovery of the Outstanding Trading Dues.

Accordingly, the Company has an obligation to deposit into the escrow account any collections received out of the
"Outstanding Trading Dues" or otherwise, as stated above, for the benefit of the Financial Creditors and as a result
therefore, the risk and reward associated with the Outstanding Trading Dues now belong to the Financial Creditor
Accordingly the Company had derecognised the said outstanding trade receivables and related provisions in the books.
The Company has not received any amounts towards Outstanding Trading Dues in the current year.

36 The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post employment
benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. Certain
sections of the Code came into effect on 3 May 2023. However, the final rules/interpretation have not yet been issued.
Based on a preliminary assessment, the entity believes the impact of the change will not be significant.

1 The Company has issued a letter of comfort to Alok Infrastructure Limited, wholly owned subsidiary Company in
order to meet its financial obligations. As on 31 March 2025, management has assessed that the possibility of
outflow of resources embodying economic benefits with respect to the letter of comfort issued is remote.

2 Claims / Debts against the Company up to the closing date which are addressed under the NCLT approved resolution
plan are not included in contingent liabilities though many of such claims / debts may be pending for disposal at
various judicial forums. As per clause 3.3.4 of the aforesaid resolution plan, these liabilities stands extinguished.

Accordingly, the management has assessed that the possibility of outflow of resources embodying economic benefits
with respect to such claims / debts is remote.

3 All direct and indirect tax liabilities relating to assessments of earlier year up to the closing date stand extinguished
as per the NCLT approved resolution plan. Further, the implementation of the resolution plan does not have any
effect over claims or receivables owed to the Company. Accordingly, the Company has assessed that any receivables
due to the Company, evaluated based on merits of underlying litigations, from various governmental agencies
continues to subsist.

(i) Sales to related parties and concerned balances

Sales are made to related parties on the same terms as applicable to third parties in an arm''s length transaction and
in the ordinary course of business. The Company enters into sales transactions with related parties as per business
practice, the Company determines the transaction price considering the amount it expects to be entitled in exchange
of transferring promised goods or services to the customer.

Trade receivables outstanding balances are unsecured and require settlement in cash. No guarantee or other
security has been received against these receivables.

(ii) Purchases of goods and services received from related parties and related balances

Purchases are made / services received (IT Support and related services) from related parties on the same terms
as applicable to third parties in an arm''s length transaction and in the ordinary course of business. Discount for this
purpose is mutually negotiated and agreed between transacting parties.

Trade payable outstanding balances are unsecured and require settlement in cash. No guarantee or other security
has been received against these receivables.

(iii) Services rendered to related parties

The Company has entered into contract with related party for rendering of job work services of Polyester.
The Company mutually negotiates and agrees the price and payment terms with the related parties on a fixed price
based on capacity utilisation.

Outstanding balances are unsecured and require settlement in cash. No guarantee or other security has been
provided against these payables.

(iv) Items of Property, Plant and Equipment (PPE) purchased from the related party

During the year 2024-25, the Company purchased items of PPE from Sintex Industries Limited. The purchase was
made on the same terms as applicable to third parties in an arm''s length transaction and in the ordinary course of
business. The Company mutually negotiated and agreed purchase price and payment terms with Sintex Industries
Limited by benchmarking the same to sale transactions with non-related parties entered into by the counter-party.
The amount was fully paid at the reporting date.

(v) Loans given to related parties

During the earlier years (prior to NCLT period), the Company had given loan to its subsidiaries. These loans are
fully provided for except for loan given to Alok Infrastructure Limited. Loan given to Alok Infrastructure Limited is
'' 1,372.99 crore out of which '' 1,168.93 crore is provided, refer note no. 47 and 49. Further, repayment of this loan
was due in the previous year ended 31 March 2024.

(vi) Loans taken from the related parties

As per the approved resolution plan, outstanding loan as on 31 March 2025''17,384.02 crore is assigned to Reliance
Industries Limited and JMFARC. Further, the Company had issued preference shares worth '' 3,300.00 crore to
Reliance Industries Limited to finance partial repayment of term loan and working capital requirements. Refer note
no. 17 and 34 for additional details.

(vii) Guarantees given by related parties

As on the reporting date, the Company has an outstanding term loan amounting to '' 3,496.39 crore from banks.
The loan is secured with charge over the assets of the Company (refer note no. 17). In addition, Reliance Industries
Limited has given a guarantee to the bank against loan obligation of the Company. As per the Guarantee arrangement,
Reliance Industries Limited will be required to make specified payments to reimburse the bank for the loss incurred
if the Company fails to make payment when due in accordance with the original terms of the loan arrangement.
Reliance Industries Limited is entitled to recover losses from the Company if it needs to make any payment to
bank under the guarantee arrangement. The Company has incurred '' 1.75 crore as commission towards Reliance
Industries Limited for the said guarantee.

(viii) Investment made in subsidiary company and joint ventures

In the previous years (prior to NCLT period), the Company has invested in its subsidiaries and joint ventures. These
investments are fully impaired as on the reporting date. Refer note no. 5 for details of investments. There are not
investments made in current and previous year.

(ix) Investment made by related parties

Refer note 15 and 17. no new investments made during the current year.

(x) Reimbursement of expenses

Alok International Inc. (wholly owned subsidiary) make certain rent payment on behalf of the Company. During the
year ended 31 March 2025, Company has reimbursed an amount of '' 4.72 crore (31 March 2024: '' 7.02 crore) in
respect of expenses paid by Alok International Inc. on behalf of the Company.

(xi) Compensation to KMP of the Company

The amounts disclosed in the table are the amounts recognised as an expense during the financial year related to
KMP. The amounts do not include expense, if any, recognised toward post-employment benefits and other long-term
benefits of KMP unless actually paid during the year. Such expenses are measured based on an actuarial valuation.
Hence, amounts attributable to KMPs are not separately determinable.

Note: Potential ordinary shares shall be treated as dilutive when, and only when, their conversion to ordinary shares
would decrease earnings per share or increase loss per share from continuing operations. If the Potential ordinary
shares are anti-dilutive then Basic EPS is considered for Dilutive EPS.

41 Disclosures Pursuant to - “Employee benefits":

i) Defined contribution plans:

The Company''s contribution to Provident Fund for the year 2024-25 aggregating to '' 8.99 crore (Previous Year: '' 9.74
crore), '' 0.90 crore (Previous Year: '' 0.89 crore) for ESIC has been recognised in the statement of profit and loss
under the head employee benefits expense. (Refer Note 28).

ii) Defined benefit plans:
a) Gratuity Plan:

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed
five years of service is entitled to specific benefit. though the gratuity liability is recognised from the date the
employee commences service, regardless of whether the employee has completed five years of continuous
service. The level of benefits provided depends on the member''s length of service and salary at retirement age.

The Company makes annual contribution to the Employee''s Company Gratuity Assurance Scheme, a funded
defined benefit plan for qualifying employees. The Fund invests in the scheme of insurance with the Life
Insurance Corporation of India, IndiaFirst Life Insurance Company Limited, SBI Life Insurance Company Limited
and Canara HSBC Life Insurance Company Limited. The scheme provides for lump sum payment to vested
employees at retirement, death while in employment or on termination of employment of an amount equivalent
to fifteen days salary payable for each completed year of service or part thereof in excess of six months.

The plans typically expose the Company to actuarial risks such as: interest rate risk, longevity risk and salary
risk.

Interest risk : The plan exposes the Company to the risk off all in interest rates. A fall in interest rates will result
in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value
of the liability.

Longevity Risk : The present value of the defined benefit plan liability is calculated by reference to the best
estimate of the mortality of plan participants both during and after their employment. An increase in the life
expectancy of the plan participants will increase the plan''s liability.

Salary risk: The present value of the defined benefit plan is calculated with the assumption of salary increase
rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from
the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s
liability.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation
were carried out at 31 March, 2025 by KP Actuaries and Consultants LLP. The present value of the defined
benefit obligation, and the related current service cost and past service cost, were measured using the Project
Unit Credit Method as per Ind AS 19.

The following table sets out the status of the gratuity plan for the year ended 31 March 2025 as required under
Ind AS 19.

43 Capital Management and Financial Management Framework:

The Company being in a working capital intensive industry, its objective is to maintain a strong credit rating, healthy
ratios and establish a capital structure that would maximize the return to stakeholders through optimum mix of debt and
equity.

The Company''s capital requirement is mainly to fund its capex, working capital, repayment of principal and interest on its
borrowings. The principal source of funding of the Company has been, and is expected to continue to be, cash generated
from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not subject
to any externally imposed capital requirements.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the
requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided
by total capital plus net debt. Since net worth of the Company is negative, debt equity ratio is not calculated.

The key risks associated with day to day operations of the Company and working capital management are given
below:

A. Credit Risk:

Credit risk is the risk that counter party will not meet its obligation under a financial instrument or customer
contract leading to a financial loss. The Company is exposed to credit risk mainly from trade receivables and other
financial assets.

i) Trade Receivables:

Trade receivables are typically unsecured and are derived from revenue earned from customer '' Credit risk has
been managed by the Company through credit approvals, establishing credit limits and continuously monitoring
the creditworthiness of customers to which the Company grants credit terms in the normal course of business.
On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment
loss or gain. The Company uses a provision matrix and forward-looking information and an assessment of the
credit risk over the expected life of the financial asset to compute the expected credit loss allowance for trade
receivables. Concentrations of credit risk with respect to trade receivables are limited.

ii) Other Financial Assets & loans

The Company has limited credit risk arising from cash and cash equivalents as the deposits are maintained
with banks and financial institutions with high credit rating. Hence, these are low risk items and the Company
evaluates the recoverability of these financial assets at each reporting date and wherever required, a provision
is created against the same.

The Company had in earlier years given loans to its subsidiaries/a Company in which erstwhile directors were
interested of Rs 1,465.99 crore, which are fully provided for in the books. The net exposure of '' 204.06 crore
is with respect of one wholly owned subsidiary whereby the Company has impaired to the extent of the fair
valuation of the subsidiary''s investment properties / inventories.

B. Market Risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of
changes in market prices. Market risk comprises of three types of risks - interest rate risk, currency risk and other
price risk in a fluctuating market environment. Financial instrument affected by market risks includes loans and
borrowings, deposits, derivatives and other financial assets.

i) Currency Risk

The Company''s functional currency is Indian Rupees (INR). The Company undertakes transactions denominated
in foreign currencies; consequently, exposure to exchange rate fluctuations arise. Volatility in exchange rates
affects the Company''s revenue from export markets and the costs of imports. The Company has exports and to
that extent has a natural hedge as a mitigation measure to cover foreign exchange risk on account of imports/
expenses in foreign currency. The Company hedges its foreign currency risk by entering into forward contracts.

Foreign Currency Sensitivity

5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel
and represents management''s assessment of the reasonably possible change in foreign exchange rates. The
sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their
translation at the period end for a 5% change in foreign currency rates. A positive number below indicates an
increase in profit and negative number below indicates a decrease in profit.

ii) Interest rate risk

a. Interest rate risk is the risk that the fair value or future cash flows of a financial instrument wifi fluctuate
because of changes in market interest rates. The Company is exposed to interest rate risk because funds
are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow
sensitivity for changes in variable interest rate. The borrowings of the Company are principally denominated
in rupees with a mix of fixed and floating rates of interest. The Company has exposure to interest rate risk,
arising principally on changes in base lending rate. The Company uses a mix of interest rate sensitive
financial instruments to manage the liquidity and fund requirements for its day to day operations. The risk
is managed by the Company by maintaining a mix between fixed and floating rate borrowings.

iii) Commodity Price Risk

Commodity price risk arises due to fluctuation in prices of raw materials like cotton and yarn. The Company has
a risk management framework aimed at prudently managing the risk arising from the volatility in commodity
prices and freight costs. The Company''s commodity risk is managed centrally through well-established trading
operations and control processes.

C. Financial risk management objectives

The Company has a Risk Management Committee established by its Board of Directors for overseeing the
Risk Management Framework and developing and monitoring the Company''s risk management policies.
The risk management policies are established to ensure timely identification and evaluation of risks,
setting acceptable risk thresholds, identifying and mapping controls against these risks, monitor the risks
and their limits, improve risk awareness and transparency. Risk management policies and systems are
reviewed regularly to reflect changes in the market conditions and the Company''s activities to provide
reliable information to the Management and the Board to evaluate the adequacy of the risk management
framework in relation to the risk faced by the Company.

D. Liquidity Risk:

Liquidity risk refers to the risk of financial distress or extraordinary high financing costs arising due to
shortage of liquid funds in a situation where business conditions unexpectedly deteriorate and requiring
financing. The Company requires funds both for short term operational needs as well as for long term
capital expenditure for capex. The Company generates sufficient cash flow from operations, which together
with the available cash and cash equivalents provide liquidity in the short-term and long-term. The
Company has established an appropriate liquidity risk management framework for the management of the
Company''s short, medium and long-term funding and liquidity management requirements. The Company
manages liquidity risk through cash generated from operations, banking facilities and reserve borrowing
facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles
of financial assets and liabilities. As at 31 March 2025, the Company has undrawn committed borrowing
facilities amounting to '' 154.76 crore and the Company expects to avail all the working capital limits
sanctioned to it in FY 25-26.

The following tables detail the Company''s remaining contractual maturity for its non-derivative financial
liabilities with agreed repayment periods. The amount disclosed in 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 contractual maturity is based on the earliest date on which the Company may be
required to pay.

Fair value hierarchy

The Company uses the following hierarchy for determining and/or disclosing the fair value of financial instrument by
valuation technique:

(i) Level 1 — quoted (unadjusted) market prices in active markets for identical assets or liabilities;

(ii) Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
directly or indirectly observable;

(iii) Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
unobservable.

There has been no transfers between level 1 & level 2 during the period.

45 Lease Disclosures
Company as a lessee

The Company has lease contracts for land used in its operations, which has a lease terms of 95 year As per the terms
of lease, the Company was required to make one-time advance lease payment for the leased land. Hence, following the
terms of the leased agreement, the Company has made the one-time lease payment and consequently, there are no
lease liabilities recorded in the Balance Sheet as at 31 March 2024. further during the current year the Company has sold
these leased lands.

The Company has entered into lease contracts (from 1 October 2022), for factory buildings with tenure of 10 years with a
lock in period of 3 year.

Refer note 2 for disclosure relating to right of use assets.

Set out below are the carrying amounts of lease liabilities (on the face of Balance sheet under Financial Liabilities)
and the movements during the period:

The Company had total cash outflows for leases of INR '' 5.06 crore in 31 March 2025 (Previous Year: '' 5.06 crore).
incremental borrowing rate for lease liabilities is 9%.

Extension and termination option

The lease of building contain termination options exercisable by both the lessor and the lessee after the end of the
non-cancellable contract period. Where practicable, the Company seeks to include termination options in new leases to
provide economic viability. The Company assesses at lease commencement whether it is reasonably certain to exercise
the termination options. The Company reassesses whether it is reasonably certain to exercise the options if there is a
significant event or significant change in circumstances within its control.

Company as a lessor

The Company has entered into leases on its investment property portfolio consisting of certain Residential flats and
commercial buildings (see Note 3). These leases have terms of between 5 and 20 year All leases include a clause to
enable upward revision of the rental charge on an annual basis according to prevailing market conditions. Rental income
recognised by the Company during the year is '' 0.26 crore (2023-24: '' 0.14 crore). There are no non-cancellable leases.

46 During the year the Board of Directors of the Company in their meeting held on 14 October 2024 has approved the sell
/ lease of some of the assets, accordingly; Land of '' 11.74 crore (net block) and Investment properties of '' 1.02 crore
transferred to "Assets held for sale".

47 The Company had granted interest free loan in earlier years (prior to corporate insolvency resolution process) to a
company which is outstanding as at the year-end amounting to '' 233.32 crores (against which an impairment allowance
of '' 233.32 crores is made). Further, the Company had granted interest free loan in earlier years (prior to the corporate
insolvency resolution process) to its wholly owned subsidiaries (''WOS'') which are outstanding as at the year-end
amounting to '' 2,605.66 crores (against which an impairment allowance of Rs 2,401.60 crores is made). Based on legal
opinion obtained by the Company, the provisions of section 186 of the Companies Act, 2013 are not applicable to all such
interest free loans granted under the erstwhile Companies Act, 1956 and by virtue of the resolution plan approved by the
NCLT, any claim from the authorities with respect to the breach / contravention / non-compliance of any Applicable law
is abated, settled and extinguished as at the closing date (i.e. 14 September 2020).

48 As per Section 135 of the Companies Act, 2013, a company meeting the applicability threshold, needs to spend at least
2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR)
activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture,
healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the Company as per the Act. The Company has incurred losses in current and
in previous years, Accordingly, as the average net profit for immediately preceding three financial years is NIL there
are no amounts required to be spend on corporate social responsibility under section 135 of the Companies Act, 2013.
Consequently, there are no unspent amount on ongoing projects / other than ongoing projects.

49 In the earlier year, on 22 March 2021, the NCLT has passed the order for withdrawal of the corporate insolvency resolution
process for Alok Infrastructure Limited ("AIL"), wholly owned subsidiary of the Company. Post this, the subsidiary had
also performed a valuation of its investment properties / inventories with the help of external valuation specialists
and accordingly considered impairment in its books in earlier year AIL do not have significant business operations and
has made a loss of '' 8.08 crore for the year ended 31 March 2025 and has accumulated losses of '' 1526.03 crore as
on 31 March 2025. During the current year, the said subsidiary has also reassessed the valuation of its investment
properties / inventories with the help of external valuation specialist and there is significant change in the valuation,
though the company has incurred losses during the year and considering improved valuations of assets of the company,
the impairment provision has been reversed by '' 32.28 crore and closing provision stands at '' 1,168.93 crore (previous
year ''1,201.21 crore) against gross loan value of ''1,372.99 crore (previous year ''1,372.99 crore) is made as on 31 March
2025 (refer note 6). Further, the aforesaid loan was due for repayment during the previous year and has not been repaid
by AIL.

50 The Company has not advanced or loaned or invested (either from borrowed funds or share premium or any other sources
or kind of funds) to or in any other person or entity, including foreign entities (“Intermediaries"), with the understanding,
whether recorded in writing or otherwise, that the Intermediary shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Further, the Company has not received any funds from any person or entity, including foreign entities (“Funding Parties"),
with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

51 The Company has used accounting software for maintaining its books of account 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. Further, there are no instance of audit trail feature being tampered with. Also, Company has preserved the
audit trail details as per the statutory requirements for record retention.

52 Other Disclosure

a. There are no proceedings initiated or are pending against the Company for holding any benami property under the
Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

b. The Company has not entered into any transactions with struck off companies during the year.

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 does not have any such 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).

f. The Company has not been declared wilful defaulter by any bank or financial institution or government or any
government authority.

55 There are no standards that are notified and not yet effective as on the date.

As per our report of even date For and on behalf of the Board of Directors of

Alok Industries Limited

For S R B C & CO LLP A. Siddharth | (Chairman) (DIN:00016278)

^{Chartered Accountants} Harsh Bapna Mumtaz Bandukwala (Non-Executive, Independent Director) (DIN:07129301)

ICAI firm registration number -

324982E/E300003 ^{(Chief Executive Officer)} Rahul Dutt (Non-Executive, Independent Director) (DIN:08872616)

Anil Kumar Mungad Hemant Desai (Non-Executive, Non Independent Director) (DIN:00008531)

per Pramod Kumar Bapna (Chief Financial Officer) Anil Kumar Rajbanshi (Non-Executive, Non Independent Director) (DIN:03370674)

Partner Hitesh Kanani V. Ramachandran (Non-Executive, Non Independent Director) (DIN:02032853)

Membership Number: 105497 (Company Secretary) Nirav Parekh (Non-Executive, Non Independent Director) (DIN:09505075)

Place: Mumbai Place: Mumbai

Date: 21^st April 2025 Date: 21^st April 2025

Corporate Identity Number of Alok Industries Limited - L17110DN1986PLC000334

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Mar 31, 2024

I) Provisions and contingent liabilities:

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be

required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material). When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably. A contingent liability is:-

a) a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity; or

b) a present obligation that arises from past events but is not recognised because:-

i) it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

ii) the amount of the obligation cannot be measured with sufficient reliability.

Contingent liability is disclosed in the case of:

• a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation;

• a present obligation arising from past events, when no reliable estimate is possible;

• a possible obligation arising from past events, unless the probability of outflow of resources is remote.

A contingent asset is disclosed where an inflow of economic benefits is probable.

Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date.

m) Retirement and other employee benefits:

Post-employment benefits

• Payments to defined contribution benefit plans are recognised as an expense when employees have rendered service entitling them to the contributions. For defined benefit retirement plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Remeasurement, comprising actuarial

gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Remeasurement recognised in other comprehensive income is not reclassified to statement of profit and loss. Past service cost is recognised in statement of profit and loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorised as follows:

• Service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

• Net interest expense or income; and

• Re-measurement.

The Company presents the first two components of defined benefit costs in statement of profit and loss in the line item “Employee benefits expense”, and the last component in Other Comprehensive Income. Curtailment gains and losses are accounted for as past service costs.

The retirement benefit obligation recognised in the balance sheet represents the actual deficit or surplus in the Company''s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.

Terminal benefits

A liability for a termination benefit is recognised at the earlier of when the entity can no longer withdraw the offer of the termination benefit and when the entity recognises any related restructuring costs.

Short-term and other long-term employee benefits

A liability is recognised for benefits accruing to employees in respect ofwages and salaries, performance incentives and similar benefits other than compensated absences in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.

Liabilities recognised in respect of compensated absences are measured on the basis of actuarial valuation as on the balance sheet date.

Liabilities recognised in respect of other long-term employee benefits are measured at the present value of the estimated future cash outflows expected to be made by the Company in respect of services provided by employees up to the reporting date. .

n) Earnings per share:

Basic earnings per share is calculated by dividing the profit/loss attributable to the owners of the Company

by the weighted average number of equity shares outstanding during the financial year.

Diluted earnings per share adjusts the figure used in determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.

q) Operating segment

Identification of segment - Operating segments are reported in the manner consistent with the internal reporting provided to the Chief Operating Decision Maker (CODM) of the Company.

Segment accounting policies - The Board of Directors of the Company have been identified as the Chief Operating Decision Maker (CODM) as defined under Ind AS 108. CODM reviews overall financial information of the Company together for performance evaluation and allocation of resources and does not review any discrete information to evaluate performance of any individual product or geography.

The Company prepares its segment information in conformity with accounting policies adopted for preparing and presenting the financial statements of the Company as a whole.

p) Onerous contracts

If the Company has a contract that is onerous, the present obligation under the contract is recognised and measured as a provision. However, before a separate provision for an onerous contract is established, the Company recognises any impairment loss that has occurred on assets dedicated to that contract.

An onerous contract is a contract under which the unavoidable costs (i.e., the costs that the Company cannot avoid because it has the contract) of meeting the obligations under the contract exceed the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfil it. The cost of fulfilling a contract comprises the costs that relate directly to the contract (i.e., both incremental costs and an allocation of costs directly related to contract activities).

q) Key sources of estimation uncertainty and critical accounting judgements

In the course of applying the accounting policies, the Company is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future period, if the revision affects current and future periods.

Key sources of estimation uncertainty

a) Useful lives of property, plant and equipment, intangible assets, investment property and right-of-use assets

Management reviews the useful lives of property, plant and equipment at least once a year. Such lives are dependent upon an assessment of both the technical lives of the assets and also their likely economic lives based on various internal and external factors including relative efficiency and operating costs. Refer Note 2 and 30 for further disclosure.

b) Property, plant and equipment, intangible assets and investment property

Determining whether the property, plant and equipment are impaired requires an estimate in the value in use of cash generating units. It requires to estimate the future cash flows expected to arise from the cash generating units and a suitable discount rate in order to calculate present value. When the present value of the cash flows are less than carrying value of property, plant and equipment a material impairment loss may arise. Refer Note 2 for further disclosure.

c) Impairment of investments in and loan given to subsidiaries and joint ventures

Determining whether the investments in and loan given to subsidiaries and joint ventures are impaired requires an estimate of the value in use. In considering the value in use, the Management have anticipated the future cash flows, discount rates and other factors of the underlying businesses/ companies. In certain cases, the Company engages third party qualified valuers to perform the valuation. The management works closely with the qualified external valuers to establish the appropriate valuation techniques and inputs to the model. Refer Note 5, 6, and 38 for further disclosure.

d) Provisions, liabilities and contingencies Provisions and liabilities are recognized in the period when it becomes probable that there will be a future outflow of funds resulting from past events that can reasonably be estimated. The timing of recognition requires application of judgement to existing facts and circumstances which may be subject to change.

In the normal course of business, contingent liabilities may arise from litigation and other claims against the Company. Potential liabilities that are possible but not probable of an outflow of resources embodying economic benefits are treated as contingent liabilities. Such liabilities are disclosed in the notes but are not recognized. Refer Note 36 for further disclosure.

e) Taxes

Deferred tax assets are recognized for unused tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilized. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies. Refer Note 8 for further disclosure.

f) Employee benefit plans

The cost of defined benefit gratuity plan and other post-employment benefits are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

The mortality rate is based on publicly available mortality tables for India. Those mortality tables tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based on expected future inflation rates. Refer Note 28 and 40 for further disclosure.

g) Lease

The application of Ind AS 116 requires Company to make judgements and estimates that affect the measurement of right-of-use assets and liabilities. In determining the lease term, the Company consider all facts and circumstances that create an economic incentive to exercise renewal options (or not exercise termination options). Assessing whether a contract includes a lease also requires judgement. Estimates are required to determine the appropriate discount rate used to measure lease liabilities.

The Company cannot readily determine the interest rate implicit in the lease, therefore, it uses its incremental borrowing rate (IBR) to measure lease liabilities. The IBR is the rate of interest that the Company would have to pay to borrow over a similar term, and with a similar security, the funds necessary

to obtain an asset of a similar value to the right-of-use asset in a similar economic environment. The IBR therefore reflects what the Company ‘would have to pay'', which requires estimation when no observable rates are available or when they need to be adjusted to reflect the terms and conditions of the lease. The Company estimates the IBR using observable inputs (such as market interest rates) when available and is required to make certain entity-specific estimates. Refer Note 44 for further disclosure.

h) Recoverability of Trade Receivables

Judgements are required in assessing the recoverability of overdue trade receivables and determining whether a provision against those receivables is required. Factors considered include the credit rating of the counterparty, the amount and timing of anticipated future payments and any possible actions that can be taken to mitigate the risk of non-payment. Refer note 11 for further disclosure.

i) Inventories

Inventories are reviewed on a regular basis and the Company make allowance for aged or obsolete inventories and write down to net realizable value primarily based on historical trends and management estimates of expected and future product demand and related pricing.

Inventories are stated at the lower of cost and net realisable value. Judgements are required in assessing the expected realisable values of Inventories. Factors considered includes demand levels and pricing competition in the industry. Refer note 10 for further disclosure.

j) Changes in accounting policies and disclosures

The Ministry of Corporate Affairs has notified Companies (Indian Accounting Standards) Amendment Rules, 2023 dated 31 March 2023 to amend the following Ind AS which are effective for annual periods beginning on or after 1 April 2023.

(i) Definition of Accounting Estimates -Amendments to Ind AS 8

(ii) Disclosure of Accounting Policies -Amendments to Ind AS 1

(iii) Deferred Tax related to Assets and Liabilities arising from a Single Transaction - Amendments to Ind AS 12

These amendments had no significant impact on the accounting policies and disclosure made in the standalone financial statements of the Company.

Note:

(i) Optionally Convertible Preference Shares :

During the previous year as per the Approved Resolution Plan, On 28^th February 2020, the Company has issued and allotted 250,00,00,000 9% Optionally Convertible Preference Shares (OCPS) of '' 1/- each to Reliance Industries Limited (RIL). (i) RIL is entitled to convert these OCPS into equity shares of the Company (1:1 basis) at any time on or before 18 months from their date of allotment i.e. 28^th February 2020. (ii) if RIL does not convert the OCPS into equity shares with in the period of 18 months, OCPS shall be redeemed at the end of 10 years from the date of allotment. (iii) dividend @9% per annum is payable on cumulative basis.

(ii) Non-Convertible Redeemable Preference Shares :

During the current year, the Company has issued and allotted 3300,00,00,000 9% Non-Convertible Redeemable Preference Shares (NCRPS) of '' 1/- each to Reliance Industries Limited(RIL). (i) These NCRPS shall be redeemable at par at any time at the option of the Company within a period not exceeding 20 years from the date of allotment i.e. 2^nd January 2024. (ii) dividend @9% per annum is payable on cumulative basis.

32 In the earlier year, the Company has completed all the steps as laid down in the resolution plan approved by the National Company Law tribunal vide its order dated 8 March 2019 and the resolution applicants had obtained joint control over the Company and the Board of Directors had been re-constituted on 14 September 2020, being the closing date as determined by the Company in terms of the resolution plan.

During the year, the Company incurred a loss of '' 813.71 crore for the year ended 31 March 2024 and has accumulated losses of '' 22,099.59 crore as on that date, its current assets exceeds its current liabilities by '' 794.12 crore and it has earned EBITDA of '' 84.89 crore for the year ended 31 March 2024. The market condition is improving and considering the cash flow projection of the Holding Company, the financial statements have been prepared on a going concern basis.

33 As per Clause 1.2 (xi) of Approved Resolution Plan, the outstanding debt amounting to '' 17,384.02 crore assigned to Resolution Applicants shall not carry interest for the first 8 years from the Closing Date (as defined in the Approved Resolution Plan), hence such debt has been measured at cost. After such period of 8 years, the terms of assigned debt shall be mutually agreed among the Resolution Applicants and the Company. The Approved Resolution Plan has an overriding effect on the requirements of Ind AS, as per legal view obtained by the Company in this regard. Hence, had the Company applied the Ind AS, it would have recognised the assigned debt at its fair value and accordingly recognized the imputed interest cost over the period of loan in the statement of profit and loss.

34 As on June 2017, the Company had an amount of '' 11,623.94 crore receivable from trading debtors on account of sale of fabric (“Outstanding Trading Dues”). As at 31 March 2019, the Company had created full provision against said receivables by charging it to the statement of profit and loss in earlier years. As per the Approved Resolution Plan, if any of the trading debtors make payment towards the Outstanding Trading Dues or any person is required to contribute to the assets of the Company under any legal process against the Outstanding Trading Dues and has contributed the same, such amounts (net of any income tax payable by the Company on account of such receipt of the Outstanding Trading Dues) shall be deposited in a designated escrow account (“Escrow Account”) to be opened in the name of the Company. Provided however, nothing contained in the resolution plan shall oblige the Resolution Applicants or the Company to take steps for recovery of the Outstanding Trading Dues.

Accordingly, the Company has an obligation to deposit into the escrow account any collections received out of the “Outstanding Trading Dues” or otherwise, as stated above, for the benefit of the Financial Creditors and as a result therefore, the risk and reward associated with the Outstanding Trading Dues now belong to the Financial Creditors. Accordingly the Company had derecognised the said outstanding trade receivables and related provisions in the books. The Company has not received any amounts towards Outstanding Trading Dues in the current year.

Note

1 The Company has issued a letter of comfort to Alok Infrastructure Limited, wholly owned subsidiary Company in order to meet its financial obligations. As on 31 March 2024, management has assessed that the possibility of outflow of resources embodying economic benefits with respect to the letter of comfort issued is remote.

2 Claims / Debts against the Company up to the closing date which are addressed under the NCLT approved resolution plan are not included in contingent liabilities though many of such claims / debts may be pending for disposal at various judicial forums. As per clause 3.3.4 of the aforesaid resolution plan, these liabilities stands extinguished.

Accordingly, the management has assessed that the possibility of outflow of resources embodying economic benefits with respect to such claims / debts is remote.

3 All direct and indirect tax liabilities relating to assessments of earlier year up to the closing date stand extinguished as per the NCLT approved resolution plan. Further, the implementation of the resolution plan does not have any effect over claims or receivables owed to the Company. Accordingly, the Company has assessed that any receivables due to the Company, evaluated based on merits of underlying litigations, from various governmental agencies continues to subsist.

4 The Company had entered into a 15-year Gas Sale Agreement (GSA) dated 27th May 2013 with GAIL India Limited (‘GAIL'') for the supply of re-liquified natural gas (RLNG) which included a Take or Pay (ToP) obligation on the Company. All of GAIL''s claims against the Company were dealt with as per the provisions of the resolution plan which was submitted during the Corporate Insolvency Resolution Process of the Company and which was duly approved by the Hon''ble National Company Law Tribunal, Bench at Ahmedabad (NCLT) vide its dated 08 March 2019. For and in relation to the periods thereafter (post the closing date i.e. 14th September 2020), GAIL had been raising demands purportedly under the ToP regime of the said GSA, despite however the Hon''ble NCLT already having directed a renegotiation of the GSA.

During the current year, the Company has received a letter from GAIL, mentioning termination of agreement for RNLG supply (take of pay agreement), by virtue of NCLT order dated 8 March 2019 and accordingly there are no outstanding obligation under the said contract.

40 Disclosures Pursuant to - “Employee benefits”:

i) Defined contribution plans:

The Company''s contribution to Provident Fund for the year 2023-24 aggregating to '' 9.74 crore (Previous Year: '' 9.30 crore), '' 0.89 crore (Previous Year: '' 0.88 crore) for ESIC has been recognised in the statement of profit and loss under the head employee benefits expense. (Refer Note 28).

ii) Defined benefit plans: a) Gratuity Plan:

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the member''s length of service and salary at retirement age.

The Company makes annual contribution to the Employee''s Company Gratuity Assurance Scheme, a funded defined benefit plan for qualifying employees. The Fund invests in the scheme of insurance with the Life Insurance Corporation of India, IndiaFirst Life Insurance Company Limited, SBI Life Insurance Company Limited and Canara HSBC Life Insurance Company Limited. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months.

The plans typically expose the Company to actuarial risks such as: interest rate risk, longevity risk and salary risk. Interest risk : The plan exposes the Company to the risk off all in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability.

Longevity Risk : The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

Salary risk: The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s liability.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out at 31 March, 2024 by KP Actuaries and Consultants LLP. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the Project Unit Credit Method as per Ind AS 19.

42 Capital Management and Financial Management Framework:

The Company being in a working capital intensive industry, its objective is to maintain a strong credit rating, healthy ratios and establish a capital structure that would maximize the return to stakeholders through optimum mix of debt and equity.

The Company''s capital requirement is mainly to fund its capex, working capital, repayment of principal and interest on its borrowings. The principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not subject to any externally imposed capital requirements.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. Since net worth of the Company is negative, debt equity ratio is not calculated.

The key risks associated with day to day operations of the Company and working capital management are given below:

A. Credit Risk:

Credit risk is the risk that counter party will not meet its obligation under a financial instrument or customer contract leading to a financial loss. The Company is exposed to credit risk mainly from trade receivables and other financial assets.

i) Trade Receivables:

Trade receivables are typically unsecured and are derived from revenue earned from customers. Credit risk has been managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix and forward-looking information and an assessment of the credit risk over the expected life of the financial asset to compute the expected credit loss allowance for trade receivables. Concentrations of credit risk with respect to trade receivables are limited.

ii) Other Financial Assets & loans

The Company has limited credit risk arising from cash and cash equivalents as the deposits are maintained with banks and financial institutions with high credit rating. Hence, these are low risk items and the Company evaluates the recoverability of these financial assets at each reporting date and wherever required, a provision is created against the same.

The Company had in earlier years given loans to its subsidiaries/a Company in which erstwhile directors were interested of '' 1,465.99 crore, which are fully provided for in the books. The net exposure of '' 171.78 crore is with respect of one wholly owned subsidiary whereby the Company has impaired to the extent of the fair valuation of the subsidiary''s investment properties / inventories.

B. Market Risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risks - interest rate risk, currency risk and other price risk in a fluctuating market environment. Financial instrument affected by market risks includes loans and borrowings, deposits, derivatives and other financial assets.

i) Currency Risk

The Company''s functional currency is Indian Rupees (INR). The Company undertakes transactions denominated in foreign currencies; consequently, exposure to exchange rate fluctuations arise. Volatility in exchange rates affects the Company''s revenue from export markets and the costs of imports. The Company has exports and to that extent has a natural hedge as a mitigation measure to cover foreign exchange risk on account of imports/ expenses in foreign currency. The Company hedges its foreign currency risk by entering into forward contracts.

iii) Commodity Price Risk

Commodity price risk arises due to fluctuation in prices of raw materials like PTA, MEG, cotton and yarn. The Company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs. The Company''s commodity risk is managed centrally through well-established trading operations and control processes.

C. Financial risk management objectives

The Company has a Risk Management Committee established by its Board of Directors for overseeing the Risk Management Framework and developing and monitoring the Company''s risk management policies. The risk management policies are established to ensure timely identification and evaluation of risks, setting acceptable risk thresholds, identifying and mapping controls against these risks, monitor the risks and their limits, improve risk awareness and transparency. Risk management policies and systems are reviewed regularly to reflect changes in the market conditions and the Company''s activities to provide reliable information to the Management and the Board to evaluate the adequacy of the risk management framework in relation to the risk faced by the Company.

D. Liquidity Risk:

Liquidity risk refers to the risk of financial distress or extraordinary high financing costs arising due to shortage of liquid funds in a situation where business conditions unexpectedly deteriorate and requiring financing. The Company requires funds both for short term operational needs as well as for long term capital expenditure for capex. The Company generates sufficient cash flow from operations, which together with the available cash and cash equivalents provide liquidity in the short-term and long-term. The Company has established an appropriate liquidity risk management framework for the management of the Company''s short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk through cash generated from operations, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. As at 31 March 2024, the Company has undrawn committed borrowing facilities amounting to '' 123.75 crore and the Company expects to enjoy all the working capital limits sanctioned to it in FY 24-25.

The following tables detail the Company''s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The amount disclosed in 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 contractual maturity is based on the earliest date on which the Company may be required to pay.

Fair value hierarchy

The Company uses the following hierarchy for determining and/or disclosing the fair value of financial instrument by valuation technique:

(i) Level 1 — quoted (unadjusted) market prices in active markets for identical assets or liabilities;

(ii) Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable;

(iii) Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

There has been no transfers between level 1 & level 2 during the period.

44 Lease Disclosures Company as a lessee

The Company has lease contracts for land used in its operations, which has a lease terms of 95 years. As per the terms of lease, the Company was required to make one-time advance lease payment for the leased land. Hence, following the terms of the leased agreement, the Company has made the one-time lease payment and consequently, there are no lease liabilities recorded in the Balance Sheet as at 31 March 2024.

The Company has also entered into new lease contracts (from 1 October 2022), for factory buildings with tenure of 10 years with a lock in period of 3 years.

Refer note 2 for disclosure relating to right of use assets.

The Company had total cash outflows for leases of INR '' 5.06 crore in 31 March 2024 (Previous Year: '' 2.53 crore). incremental borrowing rate for lease liabilities is 9%.

Extension and termination option

The lease of building contain termination options exercisable by both the lessor and the lessee after the end of the non-cancellable contract period. Where practicable, the Company seeks to include termination options in new leases to provide economic viability. The Company assesses at lease commencement whether it is reasonably certain to exercise the termination options. The Company reassesses whether it is reasonably certain to exercise the options if there is a significant event or significant change in circumstances within its control.

Company as a lessor

The Company has entered into leases on its investment property portfolio consisting of certain Residential flats and commercial buildings (see Note 3). These leases have terms of between 5 and 20 years. All leases include a clause to enable upward revision of the rental charge on an annual basis according to prevailing market conditions. Rental income recognised by the Company during the year is '' 0.14 crore (2022-23: '' 0.07 crore). There are no non-cancellable leases.

45 The Company had granted interest free loan in earlier years (prior to corporate insolvency resolution process) to a company which is outstanding as at the year-end amounting to '' 233.32 crores (against which an impairment allowance of '' 233.32 crores is made). Further, the Company had granted interest free loan in earlier years (prior to the corporate insolvency resolution process) to its wholly owned subsidiaries (‘WOS'') which are outstanding as at the year-end amounting to '' 2,605.66 crores (against which an impairment allowance of '' 2,433.88 crores is made). Based on legal opinion obtained by the Company, the provisions of section 186 of the Companies Act, 2013 are not applicable to all such interest free loans granted under the erstwhile Companies Act, 1956 and by virtue of the resolution plan approved by the NCLT, any claim from the authorities with respect to the breach / contravention / non-compliance of any Applicable law is abated, settled and extinguished as at the closing date (i.e. 14 September 2020).

46 As per Section 135 of the Companies Act, 2013, a company meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the Company as per the Act. The Company has incurred losses in current and in previous years, Accordingly, as the average net profit for immediately preceding three financial years is NIL there are no amounts required to be spend on corporate social responsibility under section 135 of the Companies Act, 2013. Consequently, there are no unspent amount on ongoing projects / other than ongoing projects.

47 In the earlier year, on 22 March 2021, the NCLT has passed the order for withdrawal of the corporate insolvency resolution process for Alok Infrastructure Limited (“AIL”), wholly owned subsidiary of the Company. Post this, the subsidiary had also performed a valuation of its investment properties / inventories with the help of external valuation specialists and accordingly considered impairment in its books in earlier years. AIL do not have significant business operations and

has made a loss of '' 12.73 crore for the year ended 31 March 2024 and has accumulated losses of '' 1,517.95 crore as on 31 March 2024. During the current year, the said subsidiary has also reassessed the valuation of its investment properties / inventories with the help of external valuation specialist and there are no significant change in the valuation, however the company has incurred losses during the year and accordingly the impairment provision of '' 1,201.21 crore (previous year '' 1,190.87 crore) against gross loan value of '' 1,372.99 crore (previous year '' 1,372.99 crore) is made as on 31 March 2024 (refer note 6).

48. The Company has not advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) to or in any other person or entity, including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Further, the Company has not received any funds from any person or entity, including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

49. The Company has used accounting software for maintaining its books of account 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. Further, there are no instance of audit trail feature being tampered with.

50 Other Disclosure

a. There are no proceedings initiated or are pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

b. The Company has not entered into any transactions with struck off companies during the year.

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 does not have any such 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).

f. The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

g. The Company has complied with the relevant provisions of the Foreign Exchange Management Act, 1999 (42 of 1999) and the Companies Act for the above transactions and the transactions are not violative of the Prevention of MoneyLaundering Act, 2002 (15 of 2003).

52 There are no standards that are notified and not yet effective as on the date.

53 Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

As per our report of even date For and on behalf of the Board of Directors of

Alok Industries Limited

For S R B C & CO LLP A. Siddharth | (Chairman) (DIN:00016278)

bartered ^Acco^untants Vinod Sureka Mumtaz Bandukwala (Non-Executive, Independent Director) (DIN:07129301)

ICAI firm registration number -

324982E/E300003 ^Chief Finanaal °ffi^cer Rahul Dutt (Non-Executive, Independent Director) (DIN:08872616)

Hitesh Kanani Hemant Desai (Non-Executive, Non Independent Director) (DIN:00008531)

per Pramod Kumar Bapna Company Secretary Anil Kumar Rajbanshi (Non-Executive, Non Independent Director) (DIN:03370674)

Partner V. Ramachandran (Non-Executive, Non Independent Director) (DIN:02032853)

Membership Number: 105497 Nirav Parekh (Non-Executive, Non Independent Director) (DIN:09505075)

Place: Mumbai Place: Mumbai

Date: 20^th April 2024 Date: 20^th April 2024

Corporate Identity Number of Alok Industries Limited - L17110DN1986PLC000334

---

Mar 31, 2023

a) During the earlier year, in accordance with the Approved Resolution Plan, the Company on 10th September, 2020, further allotted on preferential basis:- 115,32,00,000 equity shares of the face value of '' 1/- (Rupee One only) each, fully paid up, to Reliance Industries Limited, pursuant to conversion of debt; and 160,14,00,000 equity shares of the face value of '' 1/- (Rupee One only) each, fully paid up, to JM Financial Asset Reconstruction Company Limited (acting in its capacity as a Trustee of ‘JMFARC- March 2018 - Trust''- (JMFARC)), pursuant to conversion of debt. Accordingly the same has been issued for a consideration other than cash.

b) During the earlier year, In accordance with the Approved Resolution Plan, 10,827 equity shares belonging to the promoters of the Company stand cancelled and extinguished.

Reliance Industries Limited and JM Financial Asset Reconstruction Company Limited (acting in its capacity as Trustee

of JMFARC-March 2018-Trust) are also the only promoters of the Company.

(iii) Rights, preferences and restrictions attached to equity shares

i) The Company has one class of equity shares having a par value of 1 per share. Each holder of equity share is entitled to one vote per share.

ii) Right to receive dividend as may be approved by the Board of Directors / Annual General Meeting.

iii) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the Companies Act, 2013.

iv) Every member of the Company holding equity shares has a right to attend the General Meeting of the Company and has a right to vote in proportion to his share of the paid-up capital of the Company.

v) In the event of liquidation, the equity shareholders are eligible to receive remaining assets of the Company, after distribution of all preferential amounts, in proportion to their shareholding.

(i) Optionally Convertible Preference Shares :

As per the Approved Resolution Plan, the Company had issued and allotted 250,00,00,000 9% Optionally Convertible Preference Shares (OCPS) of '' 1/- each to Reliance Industries Limited(RIL). (i) These OCPS are redeemable at the end of 10 years from the date of allotment i.e. 28 February 2020. (ii) dividend @9% per annum on outstanding amount is payable on cumulative basis.

(1) Working capital loans are secured by; (i) first ranking pari-passu charge on the current assets of the Company, both present and future (ii) second ranking pari-passu charge (after term loan) over the movable fixed assets of the Company, both present and future. (iii) loan is repayable on demand and carrying interest 7% to 9% per annum.

(2) The Company has been sanctioned working capital limits in excess of Rs. five crores in aggregate from banks during the year on the basis of security of current assets of the Company. The quarterly returns/statements filed by the Company with such banks are in agreement with the books of account of the Company.

As at 31 March 2023, the Company had available '' 56.84 crores (Previous Year: '' 107.87 crores) of undrawn committed borrowing facilities.

Performance Obligation

The performance obligation is satisfied upon delivery of the goods and payment is generally due within 7 to 90 days from delivery. There are no material unsatisfied performance obligation outstanding at the year end.

The performance obligations of the Company are part of contracts that have an original expected duration of less than one year and accordingly, the Company has applied the practical expedient and opted not to disclose the information about it''s remaining performance obligations in accordance with IND AS 115.

Trade receivables are non interest bearing and are generally on terms of 7 to 90 days.

Contract assets includes amounts related to contractual right to consideration for completed performance objectives not yet invoiced.

Contract liabilities include payments received in advance of performance under the contract, and are realised with the associated revenue recognised under the contract.

32 Going Concern

In the earlier year, the Company has completed all the steps as laid down in the resolution plan approved by the National Company Law tribunal vide its order dated 8 March 2019 and the resolution applicants had obtained joint control over the Company and the Board of Directors had been re-constituted on 14 September 2020, being the closing date as determined by the Company in terms of the resolution plan.

During the FY 2022-23, owing to extreme volatility in raw material prices, subdued demand from overseas markets with hike in energy prices, the Company incurred a loss of '' 874.89 crore. It has accumulated losses of '' 21,285.88 crore and its current liabilities exceed its current assets by '' 918.44 crore as at 31 March 2023. The market condition is improving and considering the cash flow projection of the Company, the financial statements have been prepared on a going concern basis.

33 As per Clause 1.2 (xi) of Approved Resolution Plan, the outstanding debt amounting to '' 17,384.02 crore assigned to Resolution Applicants shall not carry interest for the first 8 years from the Closing Date (as defined in the Approved Resolution Plan), hence such debt has been measured at cost. After such period of 8 years, the terms of assigned debt shall be mutually agreed among the Resolution Applicants and the Company. The Approved Resolution Plan has an overriding effect on the requirements of Ind AS, as per legal view obtained by the Company in this regard. Hence, had the Company applied the Ind AS, it would have recognised the assigned debt at its fair value and accordingly recognized the imputed interest cost over the period of loan in the statement of profit and loss.

34 As on June 2017, the Company had an amount of '' 11,623.94 crore receivable from trading debtors on account of sale of fabric (“Outstanding Trading Dues”). As at 31 March 2019, the Company had created full provision against said receivables by charging it to the statement of profit and loss in earlier years. As per the Approved Resolution Plan, if any of the trading debtors make payment towards the Outstanding Trading Dues or any person is required to contribute to the assets of the Company under any legal process against the Outstanding Trading Dues and has contributed the same, such amounts (net of any income tax payable by the Company on account of such receipt of the Outstanding Trading Dues) shall be deposited in a designated escrow account (“Escrow Account”) to be opened in the name of the Company. Provided however, nothing contained in the resolution plan shall oblige the Resolution Applicants or the Company to take steps for recovery of the Outstanding Trading Dues.

Accordingly, the Company has an obligation to deposit into the escrow account any collections received out of the “Outstanding Trading Dues” or otherwise, as stated above, for the benefit of the Financial Creditors and as a result therefore, the risk and reward associated with the Outstanding Trading Dues now belong to the Financial Creditors. Accordingly the Company had derecognised the said outstanding trade receivables and related provisions in the books. The Company has not received any amounts towards Outstanding Trading Dues in the current year.

35 The Code on Social Security, 2020 (‘Code'') relating to employee benefits during employment and post employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified and the final rules/interpretation have not yet been issued. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective. Based on preliminary assessment, the Company believes the impact of the change will not be significant.

36 Contingent Liabilities in respect of :		('' in crore)
Sr. particulars No.	As at 31st March, 2023	As at 31st March, 2022
A Customs duty on shortfall in export obligation in accordance with Export Import Policy of India	17.72	23.09
B Claims against the Company not acknowledged as debts	0.12	0.12
C Take or Pay claim filed by GAIL (India) Limited under their long term Gas Sale Agreement (refer note 4 below)	-	343.06

Note

1 The Company has also issued a letter of comfort to Alok Infrastructure Limited, wholly owned subsidiary Company in order to meet its financial obligations. As on 31 March 2023, management has assessed that the possibility of outflow of resources embodying economic benefits with respect to the letter of comfort issued is remote.

2 Claims / Debts against the Company up to the closing date which are addressed under the NCLT approved resolution plan are not included in contingent liabilities though many of such claims / debts may be pending for disposal at various judicial forums. As per clause 3.3.4 of the aforesaid resolution plan, these liabilities stands extinguished.

Accordingly, the management has assessed that the possibility of outflow of resources embodying economic benefits with respect to such claims / debts is remote.

3 All direct and indirect tax liabilities relating to assessments of earlier year up to the closing date stand extinguished as per the NCLT approved resolution plan. Further, the implementation of the resolution plan does not have any effect over claims or receivables owed to the Company. Accordingly, the Company has assessed that any receivables due to the Company, evaluated based on merits of underlying litigations, from various governmental agencies continues to subsist.

4 The Company had entered into a 15-year Gas Sale Agreement (GSA) dated 27 May 2013 with GAIL India Limited (‘GAIL'') for the supply of re-liquified natural gas (RLNG) which included a Take or Pay (ToP) obligation on the Company. All of GAIL''s claims against the Company were dealt with as per the provisions of the resolution plan which was submitted during the Corporate Insolvency Resolution Process of the Company and which was duly approved by the Hon''ble National Company Law Tribunal, Bench at Ahmedabad (NCLT) vide its dated 8 March 2019. For and in relation to the periods thereafter (post the closing date i.e. 14 September 2020), GAIL raised demands (which, as on 31 March 2023, aggregate to '' 717.95 Crores). These demands were made purportedly under the ToP regime of the said GSA, despite however the Hon''ble NCLT already having directed a re-negotiation of the GSA. Aggrieved, GAIL challenged the said order of the Hon''ble NCLT by preferring an appeal before the Hon''ble National Company Law Appellate Tribunal (NCLAT). GAIL''s appeal, however, came to be dismissed by the Hon''ble NCLAT''s order dated 4 October 2021. This order of Hon''ble NCLAT was then challenged by GAIL by preferring an appeal before the Hon''ble Supreme Court. Even this appeal of GAIL was dismissed by the Hon''ble Supreme Court by its order dated 21 March 2022.

In the circumstances, the Hon''ble NCLT''s order, which was effective throughout and which had directed a renegotiation of the GSA under which GAIL made its claims, has thus now attained finality. The Company has since also sought legal opinion in the matter and based on it and the aforesaid circumstances, the Company is of the view that in terms of the order of the Hon''ble NCLT, there is no liability, either contingent or otherwise, under the GSA as claimed by GAIL or otherwise.

The Company has already in terms of the said order of the Hon''ble NCLT initiated the process for renegotiation of the GSA with GAIL and the same is pending finalization.

37 Capital Commitments		('' in crore)
Particulars	31st March, 2023	31st March, 2022
Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances)	16.66	28.65

38 The Company has determined that there is no reasonable certainty that the deferred tax assets will be utilised in near future. On the basis of such assessment, the Company has not recognised any net deferred tax assets as at 31 March 2023.

C. Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year-end are unsecured, interest free and will be settled in cash. There have been no guarantees received or provided for any related party receivables or payables.

No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person. Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member.

41 Disclosures Pursuant to - “Employee benefits”:i) defined contribution plans:

The Company''s contribution to Provident Fund for the year 2022-23 aggregating to '' 9.30 crore (Previous Year: '' 8.04 crore), '' 0.88 crore (Previous Year: '' 0.87 crore) for ESIC has been recognised in the statement of profit and loss under the head employee benefits expense. (Refer Note 28).

ii) defined benefit plans: a) Gratuity plan:

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the member''s length of service and salary at retirement age.

The Company makes annual contribution to the Employee''s Company Gratuity Assurance Scheme, a funded defined benefit plan for qualifying employees. The Fund invests in the scheme of insurance with the Life Insurance Corporation of India, IndiaFirst Life Insurance Company Limited, SBI Life Insurance Company Limited and Canara HSBC Life Insurance Company Limited. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months.

The plans typically expose the Company to actuarial risks such as: interest rate risk, longevity risk and salary risk. Interest risk : The plan exposes the Company to the risk off all in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability.

Longevity Risk : The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

Salary risk: The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s liability.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out at 31 March, 2023 by KP Actuaries and Consultants LLP. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the Project Unit Credit Method as per Ind AS 19.

42 Segment Information:

The Chief Operating Decision Maker (CODM) monitors the operating results at the Company level for the purpose of making decisions about resource allocation and performance assessment. Accordingly, the Company operates in a single primary segment namely “Textiles”, which constitutes a reportable segment as per Ind AS 108.

43 Capital Management and Financial Management Framework:

The Company being in a working capital intensive industry, its objective is to maintain a strong credit rating, healthy ratios and establish a capital structure that would maximize the return to stakeholders through optimum mix of debt and equity.

The Company''s capital requirement is mainly to fund its capex, working capital, repayment of principal and interest on its borrowings. The principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not subject to any externally imposed capital requirements.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. Since net worth of the Company is negative, debt equity ratio is not calculated.

The key risks associated with day to day operations of the Company and working capital management are given below:

A. Credit Risk:

Credit risk is the risk that counter party will not meet its obligation under a financial instrument or customer contract leading to a financial loss. The Company is exposed to credit risk mainly from trade receivables and other financial assets.

i) Trade Receivables:

Trade receivables are typically unsecured and are derived from revenue earned from customers. Credit risk has been managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix and forward-looking information and an assessment of the credit risk over the expected life of the financial asset to compute the expected credit loss allowance for trade receivables. Concentrations of credit risk with respect to trade receivables are limited.

ii) Other Financial Assets & loans

The Company has limited credit risk arising from cash and cash equivalents as the deposits are maintained with banks and financial institutions with high credit rating. Further, other financial assets mainly comprises of Export incentives which are recoverable from Government. Hence, these are low risk items and the Company evaluates the recoverability of these financial assets at each reporting date and wherever required, a provision is created against the same.

The Company had in earlier years given loans to its subsidiaries/a Company in which erstwhile directors were interested of '' 1,465.99 crore, which are fully provided for in the books. The net exposure of '' 182.12 crore is with respect of one wholly owned subsidiary whereby the Company has impaired to the extent of the fair valuation of the subsidiary''s investment properties / inventories.

B. Market Risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risks - interest rate risk, currency risk and other price risk in a fluctuating market environment. Financial instrument affected by market risks includes loans and borrowings, deposits, derivatives and other financial assets.

i) Currency Risk

The Company''s functional currency is Indian Rupees (INR). The Company undertakes transactions denominated in foreign currencies; consequently, exposure to exchange rate fluctuations arise. Volatility in exchange rates affects the Company''s revenue from export markets and the costs of imports. The Company has exports and to that extent has a natural hedge as a mitigation measure to cover foreign exchange risk on account of imports/ expenses in foreign currency. The Company hedges its foreign currency risk by entering into forward contracts.

Foreign Currency Sensitivity

5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management''s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A positive number below indicates an

ii) Interest rate risk

a. Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk because funds are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rate. The borrowings of the Company are principally denominated in rupees with a mix of fixed and floating rates of interest. The Company has exposure to interest rate risk, arising principally on changes in base lending rate. The Company uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements for its day to day operations. The risk is managed by the Company by maintaining a mix between fixed and floating rate borrowings.

iii) Commodity Price Risk

Commodity price risk arises due to fluctuation in prices of raw materials like PTA, MEG, cotton and yarn. The Company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs. The Company''s commodity risk is managed centrally through well-established trading operations and control processes.

C. Financial risk management objectives

The Company has a Risk Management Committee established by its Board of Directors for overseeing the Risk Management Framework and developing and monitoring the Company''s risk management policies. The risk management policies are established to ensure timely identification and evaluation of risks, setting acceptable risk thresholds, identifying and mapping controls against these risks, monitor the risks and their limits, improve risk awareness and transparency. Risk management policies and systems are reviewed regularly to reflect changes in the market conditions and the Company''s activities to provide reliable information to the Management and the Board to evaluate the adequacy of the risk management framework in relation to the risk faced by the Company.

D. Liquidity Risk:

Liquidity risk refers to the risk of financial distress or extraordinary high financing costs arising due to shortage of liquid funds in a situation where business conditions unexpectedly deteriorate and requiring financing. The Company requires funds both for short term operational needs as well as for long term capital expenditure for capex. The Company generates sufficient cash flow from operations, which together with the available cash and cash equivalents provide liquidity in the short-term and long-term. The Company has established an appropriate liquidity risk management framework for the management of the Company''s short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk through cash generated from operations, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. As at 31 March 2023, the Company has undrawn committed borrowing facilities amounting to '' 56.84 crore and the Company expects to enjoy all the working capital limits sanctioned to it in FY 23-24.

During the current year, due to the adverse market situation, the Company''s performance has been impacted, which has led to breach of some of the financial covenants of the term loans. The Company is regular in payment of interest and repayment of loan instalments and expects to meet all future obligations as and when due and hence the said covenant default is not expected to have any adverse impact on the financial statements.

The following tables detail the Company''s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The amount disclosed in 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 contractual maturity is based on the earliest date on which the Company may be required to pay.

Fair value hierarchy

The Company uses the following hierarchy for determining and/or disclosing the fair value of financial instrument by valuation technique:

(i) Level 1 — quoted (unadjusted) market prices in active markets for identical assets or liabilities;

(ii) Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable;

(iii) Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

There has been no transfers between level 1 & level 2 during the period.

45 Lease Disclosures Company as a lessee

The Company has lease contracts for land used in its operations, which has a lease terms of 95 years. As per the terms of lease, the Company was required to make one-time advance lease payment for the leased land. Hence, following the terms of the leased agreement, the Company has made the one-time lease payment and consequently, there are no lease liabilities recorded in the Balance Sheet as at 31 March, 2023.

The Company has also entered into new lease contracts (from 1 October 2022), for factory buildings with tenure of 10 years with a lock in period of 3 years.

The Company had total cash outflows for leases of INR '' 2.53 crore in 31 March, 2023 (Previous Year: '' Nil). incremental borrowing rate for lease liabilities is 9%.

Extension and termination option

The lease of building contain termination options exercisable by both the lessor and the lessee after the end of the non-cancellable contract period. Where practicable, the Company seeks to include termination options in new leases to

provide economic viability. The Company assesses at lease commencement whether it is reasonably certain to exercise the termination options. The Company reassesses whether it is reasonably certain to exercise the options if there is a significant event or significant change in circumstances within its control.

Company as a lessor

The Company has entered into leases on its investment property portfolio consisting of certain Residential flats and commercial buildings (see Note 3). These leases have terms of between 5 and 20 years. All leases include a clause to enable upward revision of the rental charge on an annual basis according to prevailing market conditions. Rental income recognised by the Company during the year is '' 0.46 crore (2021-22: '' 0.25 crore). There are no non-cancellable leases.

46 The Company had granted interest free loan in earlier years (prior to corporate insolvency resolution process) to a company which is outstanding as at the year-end amounting to '' 233.32 crores (against which an impairment allowance of '' 233.32 crores is made). Further, the Company had granted interest free loan in earlier years (prior to the corporate insolvency resolution process) to its wholly owned subsidiaries (‘WOS'') which are outstanding as at the year-end amounting to '' 2,605.66 crores (against which an impairment allowance of '' 2,423.54 crores is made). Based on legal opinion obtained by the Company, the provisions of section 186 of the Companies Act, 2013 are not applicable to all such interest free loans granted under the erstwhile Companies Act, 1956 and by virtue of the resolution plan approved by the NCLT, any claim from the authorities with respect to the breach / contravention / non-compliance of any Applicable law is abated, settled and extinguished as at the closing date (i.e. 14 September 2020).

47 As per Section 135 of the Companies Act, 2013, a company meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the Company as per the Act. The Company has incurred losses in current and in previous years, Accordingly, as the average net profit for immediately preceding three financial years is NIL there are no amounts required to be spend on corporate social responsibility under section 135 of the Companies Act, 2013. Consequently, there are no unspent amount on ongoing projects / other than ongoing projects.

48 In the earlier year, on 22 March 2021, the NCLT has passed the order for withdrawal of the corporate insolvency resolution process for Alok Infrastructure Limited (“AIL”), wholly owned subsidiary of the Company. Post this, the subsidiary had also performed a valuation of its investment properties / inventories with the help of external valuation specialists and accordingly considered impairment in its books in earlier years. AIL do not have significant business operations and has made a loss of '' 12.84 crore for the year ended 31 March 2023 and has accumulated losses of '' 1505.23 crore as on 31 March 2023. During the current year, the said subsidiary has also reassessed the valuation of its investment properties / inventories with the help of external valuation specialist and there are no significant change in the valuation and accordingly the impairment provision made in earlier years is adequate (refer note 6).

49. The Company has not advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) to or in any other person or entity, including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Further, the Company has not received any funds from any person or entity, including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

50 Other Disclosure

a. There are no proceedings initiated or are pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

b. The Company has not entered into any transactions with struck off companies during the year.

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 does not have any such 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).

f. The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

g. The Company has complied with the relevant provisions of the Foreign Exchange Management Act, 1999 (42 of 1999) and the Companies Act for the above transactions and the transactions are not violative of the Prevention of MoneyLaundering Act, 2002 (15 of 2003).

52 Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

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Mar 31, 2022

a) During the previous year, in accordance with the Approved Resolution Plan, the Company on 10th September, 2020, further allotted on preferential basis:- 115,32,00,000 equity shares of the face value of '' 1/- (Rupee One only) each, fully paid up, to RIL, pursuant to conversion of debt; and 160,14,00,000 equity shares of the face value of '' 1/- (Rupee One only) each, fully paid up, to JM Financial Asset Reconstruction Company Limited acting in its capacity as a Trustee of ‘JMFARC- March 2018 - Trust''- (JMFARC), pursuant to conversion of debt. Accordingly the same has been issued for a consideration other than cash.

b) During the previous year, In accordance with the Approved Resolution Plan, 10,827 equity shares belonging to the promoters of the Company stand cancelled and extinguished.

(iii) Rights, preferences and restrictions attached to equity shares

i) The Company has one class of equity shares having a par value of 1 per share. Each holder of equity share is entitled to one vote per share.

ii) Right to receive dividend as may be approved by the Board of Directors / Annual General Meeting.

iii) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the Companies Act, 2013.

iv) Every member of the Company holding equity shares has a right to attend the General Meeting of the Company and has a right to vote in proportion to his share of the paid-up capital of the Company.

v) In the event of liquidation, the equity shareholders are eligible to receive remaining assets of the company, after distribution of all preferential amounts, in proportion to their shareholding.

(i) Optionally Convertible Preference Shares :

As per the Approved Resolution Plan, the Company had issued and allotted 250,00,00,000 9% Optionally Convertible Preference Shares (OCPS) of '' 1/- each to Reliance Industries Limited(RIL). (i) These OCPS are redeemable at the end of 10 years from the date of allotment i.e. 28th February 2020. (ii) dividend @9% per annum on outstanding amount is payable on cumulative basis.

Note a - As per the approved resolution plan, loans from asset reconstruction company and body corporate are interest free for a period of 8 years, post which the terms of the assigned debt shall be mutually agreed among the resolution applicants and the Company (Refer note 34).

(iv) During the previous year, in accordance with the Approved Resolution Plan, JMFARC Limited and Reliance Industries Limited have converted debt amounting to '' 5,298.58 crore into equity, whereby the Company has issued 2,75,46,00,000 equity shares at face value '' 275.46 crore, (refer note 15) . Since it is non cash item; it is not reflected in the statement of cash flow.

(1) Working capital loans are secured by; (i) first ranking pari-passu charge on the current assets of the Company, both present and future (ii) second ranking pari-passu charge (after term loan) over the movable fixed assets of the Company, both present and future. (iii) loan is repayable on demand and carrying interest on overdradft account 3% to 5% and on other working capital loans 7% to 8% per annum.

(2) The Company has been sanctioned working capital limits in excess of Rs. five crores in aggregate from banks during the year on the basis of security of current assets of the Company. The quarterly returns/statements filed by the Company with such banks are in agreement with the books of account of the Company.

Performance Obligation

The performance obligation is satisfied upon delivery of the goods and payment is generally due within 7 to 90 days from delivery. There are no material unsatisfied performance obligation outstanding at the year end.

The performance obligations of the Company are part of contracts that have an original expected duration of less than one year and accordingly, the Company has applied the practical expedient and opted not to disclose the information about it''s remaining performance obligations in accordance with paragraph 121 of IND AS 115

Trade receivables are non interest bearing and are generally on terms of 7 to 90 days.

Contract assets includes amounts related to contractual right to consideration for completed performance objectives not yet invoiced.

Contract liabilities include payments received in advance of performance under the contract, and are realised with the associated revenue recognised under the contract.

32 In the previous year, the Company has completed all the steps as laid down in the resolution plan approved by the National Company Law tribunal vide its order dated 8th March, 2019 and the resolution applicants had obtained joint control over the Company and the Board of Directors had been re-constituted on 14th September, 2020, being the closing date as determined by the Company in terms of the resolution plan.

The re-constituted Board has adopted a business plan with specific focus on utilising the existing capacities and upgrading the efficiency / productivity of the existing machinery at the manufacturing plants. Though the Company has incurred a loss of '' 184.18 crore (before exceptional items) for the year ended 31st March, 2022. The cash flow projections for the next year are adequate to meet the existing financial obligations due in the next year. Further as at 31st March, 2022, the current assets of the Company exceeds its current liabilities by ''169.18 crore. Accordingly, the financial statements have been prepared on a going concern basis.

33 The outbreak of corona virus (Covid-19) pandemic globally and in India is causing significant disturbance and slowdown of economic activity. The Company''s operations and revenue during the current and previous period were impacted due to Covid-19. The Company has taken into account the possible impact of Covid-19 in preparation of the financial statements, including its assessment of the recoverable value of its assets based on the internal and external information up to the date of approval of these financial results and current indicators of future economic conditions.

34 As per Clause 1.2 (xi) of Approved Resolution Plan, the outstanding debt amounting to '' 17,384.02 crore assigned to Resolution Applicants shall not carry interest for the first 8 years from the Closing Date (as defined in the Approved Resolution Plan), hence such debt has been measured at cost. After such period of 8 years, the terms of assigned debt shall be mutually agreed among the Resolution Applicants and the Company. The Approved Resolution Plan has an overriding effect on the requirements of Ind AS, as per legal view obtained by the Company in this regard. Hence, had the Company applied the Ind AS, it would have recognised the assigned debt at its fair value and accordingly recognized the imputed interest cost over the period of loan in the statement of profit and loss.

35 As on June 2017, the Company had an amount of ''11,623.94/- crore receivable from trading debtors on account of sale of fabric (“Outstanding Trading Dues”). As at 31st March 2019 the Company had created full provision against said receivables by charging it to the statement of profit and loss in earlier years. As per the Approved Resolution Plan, if any of the trading debtors make payment towards the Outstanding Trading Dues or any person is required to contribute to the assets of the Company under any legal process against the Outstanding Trading Dues and has contributed the same, such amounts (net of any income tax payable by the

Company on account of such receipt of the Outstanding Trading Dues) shall be deposited in a designated escrow account (“Escrow Account”) to be opened in the name of the Company.

Accordingly, the Company has an obligation to deposit into the escrow account any collections received out of the “Outstanding Trading Dues” or otherwise, as stated above, for the benefit of the Financial Creditors and as a result therefore, the risk and reward associated with the Outstanding Trading Dues now belong to the Financial Creditors. The Company has not received any amounts towards Outstanding Trading Dues in the current year.

1 The Company has also issued a letter of comfort to Alok Infrastructure Limited, wholly owned subsidiary Company in order to meet its financial obligations. As on 31st March, 2022, management has assessed that the possibility of outflow of resources embodying economic benefits with respect to the letter of comfort issued is remote.

2 Claims / Debts against the Company upto the closing date which are addressed under the NCLT approved resolution plan are not included in contingent liabilities though many of such claims / debts may be pending for disposal at various judicial forums. As per clause 3.3.4 of the aforesaid resolution plan, these liabilities stands extinguished.

Accordingly, the management has assessed that the possibility of outflow of resources embodying economic benefits with respect to such claims / debts is remote.

3 All direct and indirect tax liabilities relating to assessments of earlier year upto the closing date stand extinguished as per the NCLT approved resolution plan. Further, the implementation of the resolution plan does not have any effect over claims or receivables owed to the Company. Accordingly, the Company has assessed that any receivables due to the Company, evaluated based on merits of underlying litigations, from various governmental agencies continues to subsist.

4 The Company has entered into Gas Sale Agreement (GSA) / Gas Transmission Agreement (GTA) dated 27th May, 2013 with GAIL India Limited (‘GAIL'') for the supply of re-liquified natural gas (RLNG) to the delivery point and for transmission of gas from the delivery point to the unit. The tenure of the agreements was for a period of 15 years and includes a take or pay clause (ToP) in the contract. Upto the closing date i.e 14th September, 2020, GAIL had raised claims of '' 1,090 crores invoking the ToP clause under the contract. GAIL was covered as an operational creditor under the NCLT approved resolution plan which provides for Nil payment if dues of operational creditors are above '' 3 lacs. Aggrieved by the order, GAIL had filed an appeal with National Company Law Appellate Tribunal (NCLAT), which has been dismissed by the latter by order dated October 4, 2021. Subsequently, the Hon''ble Supreme Court has also dismissed GAIL''s appeal vide its order dated March 21, 2022, however the question of law is kept open. Accordingly, the aforesaid claim / demand upto the closing date has been considered as remote.

The NCLT and NCLAT orders supra with respect to the GAIL matter also state that, post the closing date, if GAIL wishes to continue supply of gas to the Company, it may separately negotiate the same with the Company and the same does not fall within the ambit of the Resolution Plan. Basis this, both the parties are negotiating various operational aspects of the agreement, including those relating to ToP liability post the closing date for which GAIL has raised claims on the Company. The Company has requested GAIL for waiver of all claims raised on the Company towards ToP post the closing date and has assessed that in a situation the ToP liability is not waived by GAIL, the Company has an equal right under the gas sale agreement to pick up equivalent gas upto the end of the Recovery period, as defined in the said agreement. The Company has also assessed that the gas so picked up can be utilised and accordingly no financial loss is expected to arise to the Company. Further, the Company has also taken an independent legal view that pending the conclusion of re-negotiation of the gas sale agreement, the ToP claim, post the closing date, is a contingent liability.

* Claim raised for contract year 2020 and contract year 2021 calculated proportionately from the closing date and upto 31st March 2022.

a) In terms of the Approved Resolution Plan, JM and Reliance Industries Limited (‘RIL'') have converted such portion of their assigned debt into equity, such that their joint equity holding in the Company is 75%. Pursuant to such conversion, the proportionate reduction in Outstanding ARC Debt as per clause 1.2 (xii) of the Approved Resolution Plan is '' 5,240.14 crore. The price at which the conversion has taken place has been determined in accordance with the Approved Resolution Plan and applicable law and consequently, the difference between the issue of 275.46 crore equity shares at face value and the amount by which the assigned debt has been proportionately reduced as stated above has been recognised as exceptional gain in the statement of profit and loss in previous year.

b) In terms of the Approved Resolution Plan, 13,59,11,844 pledged equity shares were transferred to JM Financial Asset Reconstruction Company Limited (acting in its capacity as Trustee for JMFARC-March - 2018 -Trust) (referred as “JM”). Further, as per the aforesaid Plan, the debt assigned to JM has been proportionately reduced by the value of

such shares (? 58.44 crore) determined basis the lower of the trading price prevailing on BSE Limited or National Stock Exchange of India Limited one day before the date of invocation. Accordingly, extinguishment of financial liability amounting to '' 58.44 crore has been recognised as exceptional gain in the statement of profit and loss in previous year.

c) The Company has been incurring operational losses over the past few years working at capacity utilization of about 30-35%. The carrying value of assets is based on a value in use calculation which uses cash flow projections based on financial budgets approved by the management covering a seven year period, and a discount rate of 11.61% per annum. Based on the dynamics of the sector in which Company operates, the management has assumed long term growth rate of 0% to calculate the terminal value. Accordingly, the Company has recognized an impairment loss of '' 8,264.22 crore on tangible assets during the previous year and is included in exceptional items in the Statement of Profit and Loss in previous year.

C. Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year-end are unsecured, interest free and will be settled in cash. There have been no guarantees received or provided for any related party receivables or payables.

Note: Potential ordinary shares shall be treated as dilutive when, and only when, their conversion to ordinary shares would decrease earnings per share or increase loss per share from continuing operations. If the Potential ordinary shares are anti-dilutive then Basic EPS is considered for Dilutive EPS.

42 Disclosures Pursuant to - “Employee benefits”:i) defined contribution plans:

The Company''s contribution to Provident Fund for the year 2021-2022 aggregating to '' 8.04 crore (Previous Year: '' 4.17 crore), '' 0.87 crore (Previous Year: '' 0.74 crore) for ESIC has been recognised in the statement of profit and loss under the head employee benefits expense. (Refer Note 28).

ii) defined benefit plans: a) Gratuity plan:

The Company makes annual contribution to the Employee''s Company Gratuity Assurance Scheme, a funded defined benefit plan for qualifying employees. The Fund invests in the scheme of insurance with the Life Insurance Corporation of India, First Life Insurance Company Limited, SBI Life Insurance Company Limited and Canara HSBC Oriental Bank of Commerce. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

43 Segment Information:

The Chief Operating Decision Maker (CODM) monitors the operating results at the Company level for the purpose of making decisions about resource allocation and performance assessment. Accordingly, the Company operates in a single primary segment namely “Textiles”, which constitutes a reportable segment as per Ind AS 108.

44 Capital Management and Financial Management Framework:

The Company being in a working capital intensive industry, its objective is to maintain a strong credit rating, healthy ratios and establish a capital structure that would maximize the return to stakeholders through optimum mix of debt and equity.

The Company''s capital requirement is mainly to fund its capex, working capital, repayment of principal and interest on its borrowings. The principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not subject to any externally imposed capital requirements.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. Since net worth of the Company is negative, debt equity ratio is not calculated.

The key risks associated with day to day operations of the Company and working capital management are given below:

A. Credit Risk:

Credit risk is the risk that counter party will not meet its obligation under a financial instrument or customer contract leading to a financial loss. The Company is exposed to credit risk mainly from trade receivables and other financial assets.

i) Trade Receivables:

Trade receivables are typically unsecured and are derived from revenue earned from customers. Credit risk has been managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix and forward-looking information and an assessment of the credit risk over the expected life of the financial asset to compute the expected credit loss allowance for trade receivables. Concentrations of credit risk with respect to trade receivables are limited.

ii) Other Financial Assets & loans

The Company has limited credit risk arising from cash and cash equivalents as the deposits are maintained with banks and financial institutions with high credit rating. Further, other financial assets mainly comprises of Export incentives and balances with statutory authorities (GST input credit balances) which are recoverable from Government. Hence, these are low risk items and the Company evaluates the recoverability of these financial assets at each reporting date and wherever required, a provision is created against the same.

The Company had in earlier years given loans to its subsidiaries/a Company in which erstwhile directors were interested of '' 1,465.99 crore, which are fully provided for in the books. The net exposure of '' 182.12 crore is with respect of one wholly owned subsidiary whereby the Company has impaired to the extent of the fair valuation of the subsidiary''s investment properties / inventories.

B. Market Risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risks - interest rate risk, currency risk and other price risk in a fluctuating market environment. Financial instrument affected by market risks includes loans and borrowings, deposits, derivatives and other financial assets.

i) Currency Risk

The Company''s functional currency is Indian Rupees (INR). The Company undertakes transactions denominated in foreign currencies; consequently, exposure to exchange rate fluctuations arise. Volatility in exchange rates affects the Company''s revenue from export markets and the costs of imports. The Company has exports and to that extent has a natural hedge as a mitigation measure to cover foreign exchange risk on account of imports/ expenses in foreign currency.

The Company manages its foreign currency risk by entering into forward contracts.

Foreign Currency Sensitivity

5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management''s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A positive number below indicates an increase in profit and negative number below indicates a decrease in profit.

Following is the analysis of change in profit and pre-tax equity where the Indian Rupee strengthens and weakens by 5% against the relevant currency:

ii) Interest rate risk

a. Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk because funds are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rate. The borrowings of the Company are principally denominated in rupees with a mix of fixed and floating rates of interest. The Company has exposure to interest rate risk, arising principally on changes in base lending rate. The Company uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements for its day to day operations. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings.

iii) Commodity Price Risk

Commodity price risk arises due to fluctuation in prices of raw materials like PTA, MEG, cotton and yarn. The Company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs. The Company''s commodity risk is managed centrally through well-established trading operations and control processes.

C. Financial risk management objectives

The Company has a Risk Management Committee established by its Board of Directors for overseeing the Risk Management Framework and developing and monitoring the Company''s risk management policies. The risk management policies are established to ensure timely identification and evaluation of risks, setting acceptable risk thresholds, identifying and mapping controls against these risks, monitor the risks and their limits, improve risk awareness and transparency. Risk management policies and systems are reviewed regularly to reflect changes in the market conditions and the Company''s activities to provide reliable information to the Management and the Board to evaluate the adequacy of the risk management framework in relation to the risk faced by the Company.

D. Liquidity Risk:

Liquidity risk refers to the risk of financial distress or extraordinary high financing costs arising due to shortage of liquid funds in a situation where business conditions unexpectedly deteriorate and requiring financing. The Company requires funds both for short term operational needs as well as for long term capital expenditure for capex. The Company generates sufficient cash flow for operations, which together with the available cash and cash equivalents provide liquidity in the short-term and long-term. The Company has established an appropriate liquidity risk management framework for the management of the Company''s short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk through cash generated from operations, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. As at 31st March, 2022, the Company''s current assets exceeds its current liabilities by '' 169.18 crore.

The following tables detail the Company''s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The amount disclosed in 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 contractual maturity is based on the earliest date on which the Company may be required to pay.

Fair value hierarchy

The Company uses the following hierarchy for determining and/or disclosing the fair value of financial instrument by valuation technique:

(i) Level 1 — quoted (unadjusted) market prices in active markets for identical assets or liabilities;

(ii) Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable;

(iii) Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

There has been no transfers between level 1 & level 2 during the period.

46 Operating Leases Company as a lessee

The Company has lease contracts for land used in its operations, which has a lease terms of 95 years. Refer note 2 for disclosure relating to right of use assets.

As per the terms of lease, the Company was required to make one-time advance lease payment for the leased land. Hence, following the terms of the leased agreement, the Company has made the one-time lease payment and consequently, there are no lease liabilities recorded in the Balance Sheet as at 31st March, 2022.

Company as a lessor

The Company has entered into leases on its investment property portfolio consisting of certain Residential flats and commercial buildings (see Note 3). These leases have terms of between 5 and 20 years. All leases include a clause to enable upward revision of the rental charge on an annual basis according to prevailing market conditions. Rental income recognised by the Company during the year is ''0.25 crore (2020-21: '' 0.43 crore). There are no non-cancellable leases.

47 The Company had granted interest free loan in earlier years (prior to corporate insolvency resolution process) to a company which is outstanding as at the year-end amounting to '' 233.32 crores (against which an impairment allowance of '' 233.32 crores is made). Further, the Company had granted interest free loan in earlier years (prior to the corporate insolvency resolution process) to its wholly owned subsidiaries (‘WOS'') which are outstanding as at the year-end amounting to '' 2,605.66 crores (against which an impairment allowance of '' 2,423.54 crores is made). Based on legal opinion obtained by the Company, the provisions of section 186 of the Companies Act, 2013 are not applicable to all such interest free loans granted under the erstwhile Companies Act, 1956 and by virtue of the resolution plan approved by the NCLT, any claim from the authorities with respect to the breach / contravention / non-compliance of any Applicable law is abated, settled and extinguished as at the closing date (i.e. September 14, 2020).

48 As per Section 135 of the Companies Act, 2013, a Company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the Company as per the Act. The Company has incurred losses in current and in previous years, Accordingly, as the average net profit for immediately preceding three financial years is NIL there are no amounts required to be spend on corporate social responsibility under section 135 of the Companies Act, 2013. Consequently, there are no unspent amount on ongoing projects / other than ongoing projects.

49 In the previous year, on 22nd March, 2021, the NCLT has passed the order for withdrawal of the corporate insolvency resolution process for Alok Infrastructure Limited, wholly owned subsidiary of the Company. Post this, the subsidiary had also performed a valuation of its investment properties / inventories with the help of external valuation specialists and accordingly considered impairment in its books. Based on the results of such impairment testing, the Company had also impaired its loan given to the said subsidiary further by '' 689.48 crores in the previous year and disclosed the same in Note 31 (also, refer note 6).

50 The Company had unutilised amount of '' 150 crore raised through preferential allotment / private placement of equity shares in earlier years which have been utilised in the current year for capital expenditure and meeting working capital requirements.

51 The Company has not advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) to or in any other person or entity, including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Further, the Company has not received any funds from any person or entity, including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

52 Other Disclosure

a. There are no proceedings initiated or are pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

b. The Company has not entered into any transactions with struck off companies during the year.

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 does not have any such 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).

54 Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

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Mar 31, 2021

a) During the previous year, in accordance with the Approved Resolution Plan, the face value of the Company''s equity has been reduced from '' 10/- per share to '' 1/- per share.

b) During the previous year, in accordance with the Approved Resolution Plan, the Company has issued and allotted 83,33,33,333 equity of '' 1/- each at a premium of '' 2/- per share to Reliance Industries Limited (RIL) on 28th February, 2020.

c) During the year, in accordance with the Approved Resolution Plan, the Company on 10th September, 2020, further allotted on preferential basis:- 115,32,00,000 equity shares of the face value of '' 1/- (Rupee One only) each, fully paid up, to RIL, pursuant to conversion of debt; and 160,14,00,000 equity shares of the face value of '' 1/- (Rupee One only) each, fully paid up, to JM Financial Asset Reconstruction Company Limited acting in its capacity as a Trustee of ‘JMFARC- March 2018 - Trust''- (JMFARC), pursuant to conversion of debt. Accordingly the same has been issued for a consideration other than cash.

d) In accordance with the Approved Resolution Plan, 10,827 equity shares belonging to the erstwhile promoters of the company stand cancelled and extinguished.

(iii) Rights, preferences and restrictions attached to equity shares

i) The Company has one class of equity shares having a par value of 1 per share. Each holder of equity share is entitled to one vote per share.

ii) Right to receive dividend as may be approved by the Board of Directors / Annual General Meeting.

iii) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the Companies Act, 2013.

iv) Every member of the Company holding equity shares has a right to attend the General Meeting of the Company and has a right to vote in proportion to his share of the paid-up capital of the Company.

v) In the event of liquidation, the equity shareholders are eligible to receive remaining assets of the company, after distribution of all preferential amounts, in proportion to their shareholding.

(i) Optionally Convertible Preference Shares :

During the previous year as per the Approved Resolution Plan, On 28th February 2020, the Company has issued and allotted 250,00,00,000 9% Optionally Convertible Preference Shares (OCPS) of '' 1/- each to Reliance Industries Limited (RIL). (i) RIL is entitled to convert these OCPS into equity shares of the Company (1:1 basis) at any time on or before 18 months from their date of allotment i.e. 28th February 2020. (ii) if RIL does not convert the OCPS into equity shares with in the period of 18 months, OCPS shall be redeemed at the end of 10 years from the date of allotment. (iii) dividend @9% per annum on outstanding amount is payable on cumulative basis.

Note a - As per the approved resolution plan, loans from asset reconstruction company and body corporate are interest free for a period of 8 years, post which the terms of the assigned debt shall be mutually agreed among the resolution applicants and the Company (Refer note 34).

(iv) During the current year, in accordance with the Approved Resolution Plan, JMFARC Limited and Reliance Industries Limited have converted debt amounting to '' 5,298.58 crore into equity, whereby the Company has issued 2,75,46,00,000 equity shares at face value '' 275.46 crore, (refer note 15). Since it is non cash item; it is not reflected in the statement of cash flow.

Pursuant to the commencement of the corporate insolvency resolution process (‘CIRP'') in July 2017, in the previous year the National Company Law Tribunal vide its order dated 8th March, 2019 had approved the resolution plan submitted by JM Financial Asset Reconstruction Company Limited, JM Finance ARC - March 19 Trust and Reliance Industries Limited (‘the resolution applicants'') under Section 31 of the Insolvency and Bankruptcy Code, 2016 (‘IBC''). This approved resolution plan shall be binding on the Company, its employees, members, creditors, guarantors and other stakeholders involved in the resolution plan. In the previous year, the Company had commenced the implementation of the steps as required under Annexure 2 of the approved resolution plan vis a vis pay-outs of various CIRP costs and dues to workmen / employees, financial and operational creditors; assignment of debt to resolution applicants; reduction of capital etc.

In the current year, the Company has completed the remaining steps as laid down in Annexure 2 of the resolution plan and the resolution applicants have obtained joint control over the Company and the Board of Directors have been re-constituted on 14th September, 2020, being the closing date as determined by the Company in terms of the resolution plan.

With a view to improve the performance of the Company, the re-constituted Board has adopted a 8 year business plan with specific focus on utilising the existing capacities and upgrading the efficiency / productivity of the existing machinery at the manufacturing plants. Though the Company has incurred a loss of Rs 1,190.78 crore (before exceptional items) for the year ended 31st March, 2021 and has accumulated losses of Rs 16,761.90 crore as on 31st March, 2021, the Company has no immediate loan obligations and its current assets exceed the current liabilities by Rs 443.35 crore. Accordingly, the financial statements have been prepared on a going concern basis.

The World Health Organisation declared outbreak of Coronavirus Disease (COVID-19) as a global pandemic on 11th March, 2020. Consequently, Government of India declared a nation-wide lockdown on 23rd March, 2020 and the Company temporarily suspended operations in all its units in compliance with the lockdown instructions issued by the Central and State Governments. COVID-19 has impacted the normal business operations of the Company by way of interruption in production, supply chain disruption, unavailability of personnel, closure/ lock down of production facilities etc. during the lockdown period which was extended till 17th May, 2020.

However, post this date, production and supply of goods had commenced at manufacturing locations of the Company after obtaining due permissions from the appropriate government authorities. Based on the same, the Company does not expect any material adverse effect on the operations of the Company.

The Company has taken into account the possible impact of Covid-19 in preparation of the financial statements, including its assessment of the recoverable value of its assets based on the internal and external information up to the date of approval of these financial statements and current indicators of future economic conditions.

I As per Clause 1.2 (xi) of Approved Resolution Plan, the outstanding debt assigned to Resolution Applicants shall not carry interest for the first 8 years from the Closing Date (as defined in the Approved Resolution Plan), hence such debt has been measured at cost. After such period of 8 years, the terms of assigned debt shall be mutually agreed among the Resolution Applicants and the Company. The Approved Resolution Plan has an overriding effect on the requirements of Ind AS, as per legal view obtained by the Company in this regard. Hence, had the Company applied the Ind AS, it would have recognised the assigned debt at its fair value and accordingly recognized the imputed interest cost over the period of loan in the statement of profit and loss.

5 As on June 2017, the Company had an amount of '' 11,623.94/- crore receivable from trading debtors on account of sale of fabric (“Outstanding Trading Dues”). As at 31st March 2019 the Company had created full provision against said receivables by charging it to the statement of profit and loss in earlier years. As per the Approved Resolution Plan, if any of the trading debtors make payment towards the Outstanding Trading Dues or any person is required to contribute to the assets of the Company under any legal process against the Outstanding Trading Dues and has contributed the same, such amounts (net of any income tax payable by the Company on account of such receipt of the Outstanding Trading Dues) shall be deposited in a designated escrow account (“Escrow Account”) to be opened in the name of the Company.

Accordingly, the Company has an obligation to deposit into the escrow account any collections received out of the “Outstanding Trading Dues” or otherwise, as stated above, for the benefit of the Financial Creditors and as a result therefore, the risk and reward associated with the Outstanding Trading Dues now belong to the Financial Creditors. The Company has not received any amounts towards Outstanding Trading Dues in the current year.

1 The Company has also issued a letter of comfort to Alok Infrastructure Limited, wholly owned subsidiary company in order to meet its financial obligations. As on March 31, 2021, management has assessed that the possibility of outflow of resources embodying economic benefits with respect to the letter of comfort issued is remote.

2 Claims / Debts against the Company upto the closing date which are addressed under the NCLT approved resolution plan are not included in contingent liabilities though many of such claims / debts may be pending for disposal at various judicial forums. As per clause 3.3.4 of the aforesaid resolution plan, these liabilities stands extinguished. Accordingly, the management has assessed that the possibility of outflow of resources embodying economic benefits with respect to such claims / debts is remote.

3 All direct and indirect tax liabilities relating to assessments of earlier year upto the closing date stand extinguished as per the NCLT approved resolution plan. Further, the implementation of the resolution plan does not have any effect over claims or receivables owed to the Company. Accordingly, the Company has assessed that any receivables due to the Company, evaluated based on merits of underlying litigations, from various governmental agencies continues to subsist.

4 The Company has entered into Gas Sale Agreement (GSA) / Gas Transmission Agreement (GTA) dated 27th May, 2013 with GAIL India Limited (‘GAIL'') for the supply of re-liquified natural gas (RLNG) to the delivery point and for transmission of gas from the delivery point to the unit. The tenure of the agreements was for a period of 15 years and includes a take or pay clause in the contract. Upto the closing date i.e 14th September, 2020, GAIL has raised claims of '' 1,090 crores invoking the take or pay clause under the contract. GAIL was covered as an operational creditor under the NCLT approved resolution plan which provides for Nil payment if dues of operational creditors are above '' 3 lacs. Aggrieved by the order, GAIL has filed an appeal with National Company Law Appellate Tribunal (NCLAT) which is pending for disposal. As stated in Note 36, all claims upto the closing date i.e. 14th September, 2020 stands extinguished as per the approved resolution plan. Further, in light of the various recent judicial pronouncements made by the NCLAT and the Hon''ble Supreme Court of India in IBC related cases, it is established that the provisions of section 32A of the IBC are absolute and binding. Accordingly, Company considers that the aforesaid claim / demand relating to those upto the closing date is remote.

The Company has re-assessed the Deferred Tax assets recognized in earlier years, based on the new management''s business plan and accordingly determined that there is no reasonable certainty that these deferred tax assets will be utilised in future. On the basis of such assessment the parent company has not recognised any deferred tax assets as at March 31, 2021 and has reversed its opening deferred tax assets of '' 1,423.11 crore.

In the opinion of management, the current assets and other non-current assets after necessary provisions / write offs have a value on realisation in the ordinary course of the business, at least equal to the amount at which they are stated.

assumed long term growth rate of 0% to calculate the terminal value. Accordingly, the Company has recognized an impairment loss of Rs. 8,264.22 crore on tangible assets during the year and is included in exceptional items for the year in the Statement of Profit and Loss.

In terms of the Approved Resolution Plan, JM and Reliance Industries Limited (‘RIL'') have converted such portion of their assigned debt into equity, such that their joint equity holding in the Company is 75%. Pursuant to such conversion, the proportionate reduction in Outstanding ARC Debt as per clause 1.2 (xii) of the Approved Resolution Plan is '' 5,240.14 crore. The price at which the conversion has taken place has been determined in accordance with the Approved Resolution Plan and applicable law and consequently, the difference between the issue of 275.46 crore equity shares at face value and the amount by which the assigned debt has been proportionately reduced as stated above has been recognised as exceptional gain in the statement of profit and loss.

In terms of the Approved Resolution Plan, 13,59,11,844 pledged equity shares were transferred to JM Financial Asset Reconstruction Company Limited (acting in its capacity as Trustee for JMFARC-March - 2018 -Trust) (referred as “JM”). Further, as per the aforesaid Plan, the debt assigned to JM has been proportionately reduced by the value of such shares (Rs 58.44 crore) determined basis the lower of the trading price prevailing on BSE Limited or National Stock Exchange of India Limited one day before the date of invocation. Accordingly, extinguishment of financial liability amounting to '' 58.44 crore has been recognised as exceptional gain in the statement of profit and loss.

The Company has been incurring operational losses over the past few years working at capacity utilization of about 30-35%. The carrying value of assets is based on a value in use calculation which uses cash flow projections based on financial budgets approved by the management covering a seven year period, and a discount rate of 11.61% per annum. Based on the dynamics of the sector in which Company operates, the management has

Exceptional Item - for the year ended 31st March, 2020

d) In previous year, as per the resolution plan, in respect of operational creditors of whom erstwhile resolution professional had admitted claims up to '' 3 lakh, the Company has already paid the dues. With respect to other operational creditors outstanding as on the insolvency commencement date, the Company has recognized a gain of '' 938.97 crore on account of extinguishment of such liabilities as an exceptional item in these financial statements.

e) In previous year, in respect of financial creditors the Company has already paid / provided as per the resolution plan. No financial creditor now has any further rights or claim against the Company, in respect of the period prior to the insolvency commencement date or in respect of the amounts written back. Accordingly, the company has recognised a gain of '' 1,093.51 crore on account of extinguishment of such financial liability as an exceptional item.

41 In the current year, management has performed an impairment assessment of the recoverability of the carrying value of its investments in the joint ventures i.e Aurangabad Textiles & Apparel Parks Limited and New City of Bombay Mfg. Mills Limited and accordingly impaired the full value in the books. In doing so, management has taken into consideration the Company''s share in expected recovery of assets of the joint ventures, net of any liabilities and guarantees given by the Company in respect of the joint ventures.

i) Defined contribution plans:

The Company''s contribution to Provident Fund for the year 2020-2021 aggregating to '' 4.17 crore (Previous Year: '' 4.05 crore), '' 0.74 crore (Previous Year: '' 0.88 crore) for ESIC has been recognised in the statement of profit and loss under the head employee benefits expense. (Refer Note 28).

ii) Defined benefit plans: a) Gratuity Plan:

The Company makes annual contribution to the Employee''s Company Gratuity Assurance Scheme, a funded defined benefit plan for qualifying employees. The Fund invests in the scheme of insurance with the Life Insurance Corporation of India, First Life Insurance Company Limited, SBI Life Insurance Company Limited and Canara HSBC Oriental Bank of Commerce. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

46 Capital Management and Financial Management Framework:

The Company being in a working capital intensive industry, its objective is to maintain a strong credit rating, healthy ratios and establish a capital structure that would maximize the return to stakeholders through optimum mix of debt and equity.

The Company''s capital requirement is mainly to fund its capex, working capital, repayment of principal and interest on its borrowings. The principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not subject to any externally imposed capital requirements.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. Since net worth of the Company is negative, debt equity ratio is not calculated.

The key risks associated with day to day operations of the Company and working capital management are given below:

A. Credit Risk:

Credit risk is the risk that counter party will not meet its obligation under a financial instrument or customer contract leading to a financial loss. The Company is exposed to credit risk mainly from trade receivables and other financial assets.

i) Trade Receivables:

Trade receivables are typically unsecured and are derived from revenue earned from customers. Credit risk has been managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix and forward-looking information and an assessment of the credit risk over the expected life of the financial asset to compute the expected credit loss allowance for trade receivables. Concentrations of credit risk with respect to trade receivables are limited.

ii) Other Financial Assets & loans

The Company has limited credit risk arising from cash and cash equivalents as the deposits are maintained with banks and financial institutions with high credit rating. Further, other financial assets mainly comprises of Export incentives and balances with statutory authorities (GST input credit balances) which are recoverable from Government. Hence, these are low risk items and the Company evaluates the recoverability of these financial assets at each reporting date and wherever required, a provision is created against the same.

The Company had in earlier years given loans to its subsidiaries/a company in which erstwhile directors were interested of '' 1,465.99 crore, which are fully provided for in the books. The net exposure of '' 689.48 crore is with respect of one wholly owned subsidiary whereby the company has impaired to the extent of the fair valuation of the subsidiary''s investment properties / inventories.

B. Market Risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risks - interest rate risk, currency risk and other price risk in a fluctuating market environment. Financial instrument affected by market risks includes loans and borrowings, deposits, derivatives and other financial assets.

i) Currency Risk

The Company''s functional currency is Indian Rupees (INR). The Company undertakes transactions denominated in foreign currencies; consequently, exposure to exchange rate fluctuations arise. Volatility in exchange rates affects the Company''s revenue from export markets and the costs of imports. The Company has exports and to that extent has a natural hedge as a mitigation measure to cover foreign exchange risk on account of imports/ expenses in foreign currency.

Foreign Currency Sensitivity

5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management''s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A positive number below indicates an increase in profit and negative number below indicates a decrease in profit.

ii) Interest rate risk

a. Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk because funds are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rate. The borrowings of the Company are principally denominated in rupees with a mix of fixed and floating rates of interest. The Company has exposure to interest rate risk, arising principally on changes in base lending rate. The Company uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements for its day to day operations. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings.

Fair value hierarchy

The Company uses the following hierarchy for determining and/or disclosing the fair value of financial instrument by valuation technique:

(i) Level 1 — quoted (unadjusted) market prices in active markets for identical assets or liabilities;

(ii) Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable;

(iii) Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

There has been no transfers between level 1 & level 2 during the period.

48 Operating Leases Company as a lessee

The Company has lease contracts for land used in its operations, which has a lease terms of 95 years. Refer note 5 for disclosure relating to right of use assets.

As per the terms of lease, the Company was required to make one-time advance lease payment for the leased land. Hence, following the terms of the leased agreement, the Company has made the one-time lease payment and consequently, there are no lease liabilities recorded in the Balance Sheet as at 31st March, 2021.

Company as a lessor

The Company has entered into leases on its investment property portfolio consisting of certain Residential flats and commercial buildings (see Note 3). These leases have terms of between 5 and 20 years. All leases include a clause to enable upward revision of the rental charge on an annual basis according to prevailing market conditions. Rental income recognised by the Company during the year is '' 0.43 crore (2020: '' 0.27 crore). There are no non-cancellable leases.

49 Disclosure pursuant to Security and Exchange board of India (Listing Obligations and Disclosures requirements) regulation, 2015 and section 186(4) of the Companies Act, 2013 are as under:

c. Corporate Guarantees given by the Company in respect of loans taken by subsidiary companies (proposed to be utilised for business) - Nil

d. Security provided - Nil

50 As per Section 135 of the Companies Act, 2013, a Company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the Company as per the Act. The funds were primarily allocated to a corpus and utilized through the year on these activities which are specified in Schedule VII of the Companies Act, 2013.

The Company has incurred losses in current and in previous years, Accordingly, as the average net profit for immediately preceding three financial years is NIL there are no amounts required to be spend on corporate social responsibility under section 135 of the Companies Act, 2013.

AUDITOR’S REPORT on Consolidated Financial Statement

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Mar 31, 2018

CORPORATE INFORMATION

Alok Industries Limited (“The Company”) is a public limited company, domiciled in India and incorporated under the provisions of the Companies Act, 1956. The equity shares of the Company are listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). It is primarily engaged in the business of textile manufacturing including mending and packing activities.

The Company was admitted under NCLT process on 18 July 2017 and Mr. Ajay Joshi has been appointed as Resolution Professional (RP) to manage the operations in terms of the IBC, 2016. Upon admission of the insolvency petition, the powers of the Board of Directors of the Company stand suspended.

The financial statements were certified by Chief Financial Officer and Company Secretary and taken on record by the Resolution Professional at meeting held on 10 August 2018.

(i) Rights, preferences and restrictions attached to equity shares

The Company has single class of equity shares. Each shareholders is eligible for one vote per share held. In the event of liquidation, the equity shareholders are eligible to receive remaining assets of the company, after distribution of all preferential amounts, in proportion to their shareholding.

(iv) During the previous year, the Company was required to amend the Authorized Share Capital of the Company to Rs. 4,000 crore from Rs. 1,500 crore through an Extra Ordinary General Meeting (EOGM) in order to accommodate the conversion of debt into equity under the SDR provisions. A Singapore based bank led consortium through their security trustee, Hong Kong and Shanghai Banking Corporation (HSBC) filed a petition in the Bombay High Court for winding up the company and further prayed for stalling the EOGM to protect their interest. The Court, however, allowed the the EOGM to be conducted on submission of an affidavit by the Company that the resolutions passed at the EOGM for change in capital structure will not be implemented without obtaining prior written approval from HSBC. The Company filed a letter with the Registrar of Companies, Ahmedabad citing the circumstances why the change in capital structure could not be implemented. The petition filed by HSBC has since been disposed as withdrawn by the Bombay High Court. Accordingly, the Company has given effect to the enhanced Authorized Share Capital in the current year

b) All the debentures are secured by pari passu charge on the immovable property situated at Mouje Irana, Taluka Kadi, District Mehsana in the state of Gujarat. Further, Debentures of Rs. 344.98 Crores are secured by first pari passu charge created on fixed assets of the company and Debentures of Rs. 286.01 Crores are secured by subservient charge on fixed and current assets of the Company (excluding Land and Building).

# Includes loans aggregating to Rs. 81.27 Crores (Previous period Rs. 69.82 Crores) which are further secured by personal guarantees of promoter directors / corporate guarantee of promoter group companies

# Includes Bank loans aggregating to Rs. 2284.50 Crores (Previous period Rs. 2,204.20 Crores) & Financial Institution loans aggregating to Rs. 100 Crores (Previous period Rs. 100 Crores) which are further secured by personal guarantees of promoter directors / corporate guarantee of promoter group Companies.

# Includes Bank loans aggregating Rs. 519.88 Crores (Previous period 519.88) secured by charge created on part of the land owned by Alok Infrastructure Limited, wholly owned subsidiary of the Company. The company is taking necessary steps for creation of such charge.

(vi) Currently the company is under IBC process and is not require to meet any loan or interest obligation till approval of final resolution. Hence due to non availability of data of repayments schedule of borrowings, borrowings are classified current / non current based on normal circumstances.

# Includes Bank loans aggregating Rs. 2329.62 Crores (Previous period Rs. 2,295.20 Crores) for which charge is being created on part of the land owned by Alok Infrastructure Limited, wholly owned subsidiary of the Company.

* Includes Bank loans aggregating Rs. 43.69 Crores (Previous period Rs. 43.55 Crores) secured by charge created / is being created on part of the land owned by Alok Infrastructure Limited, wholly owned subsidiary of the Company.

@ Includes loans aggregating Rs. 77.76 Crores (Previous period Rs. 75.50 Crores) secured by charge created on part of the land owned by Alok Infrastructure Limited, wholly owned subsidiary of the Company.

$ Includes Rs. Nil (previous year Rs. 64.60 crore) Secured by first charge on three floors of Peninsula Business Park owned by Alok Infrastructure Limited, wholly owned subsidiary of the Company and Rs. 28.68 crore (previous year Rs. 48.49 crores) secured by second charge on one floor of Peninsula Business Park owned by Alok Infrastructure Limited, wholly owned subsidiary of the Company.

1 Alok Industries Limited (“Company”) was admitted under the corporate insolvency resolution (“CIR”) process in terms of the Insolvency and Bankruptcy Code, 2016 (“Code”), vide an order dated 18 July 2017 of the Hon’ble National Company Law Tribunal, Ahmedabad (“Adjudicating Authority”). Pursuant to the said order, Mr. Ajay Joshi was appointed as the interim resolution professional for the Company and was subsequently confirmed as the resolution professional (“RP”). During the CIR process, only one resolution plan (“Resolution Plan”) was received from JM Financial Asset Reconstruction Company Limited, JM Finance ARC Trust and Reliance Industries Limited jointly (“Resolution Applicants”). This Resolution Plan was not approved by the Committee of Creditors (“COC”) with the requisite majority as required then under Section 30 (4) of the Code (which was 75% of assenting voting share). Under the provisions of the Code, the RP filed a liquidation application on 16^th April, 2018 before the Adjudicating Authority.

Pursuant to promulgation of the Insolvency and Bankruptcy (Amendment) Ordinance dated 6 June 2018 (“Ordinance”), the voting threshold for approval of Resolution Plan was reduced from 75% to 66%. The Adjudicating Authority in an application by Alok Employees Benefit & Welfare Trust passed an order dated 11 June 2018 directing the Resolution Professional to present the Resolution Plan of the sole Resolution Applicants before the COC for a re-look and proper consideration as per the Ordinance. Accordingly, in compliance with the said order, the Resolution Plan submitted jointly by the Resolution Applicants was again placed before the COC for approval under Section 30 (4) of the Code (as amended by the Ordinance). The Resolution Plan was approved by the COC with 72.192% assenting voting share. Subsequently, vide its order dated 25^th June, 2018, the Adjudicating Authority granted liberty to the RP to withdraw the liquidation application filed by it and file an application for approval of Resolution Plan. Accordingly, the RP withdrew the liquidation application and filed the resolution plan for approval of the Adjudicating Authority. Vide an order dated 17 July 2018, the Adjudicating Authority dismissed the liquidation application. The application filed by the RP for approval of Resolution Plan is currently pending adjudication by the Adjudicating Authority.

Post the commencement of the CIR process, the Company is continuing to operate as a going concern in terms of the Code. Currently, the application for approval of the Resolution Plan is pending with the Adjudicating Authority and therefore the financial statements are being presented on a going concern basis.

2 Certain financial creditors of the Company have filed various applications before the Adjudicating Authority as well as the Hon’ble National Company Law Appellate Tribunal, New Delhi (“Appellate Tribunal”), inter alia, challenging the Resolution Plan of the Company. These applications are pending adjudication by the respective tribunals. In the event, the Adjudicating Authority/Appellate Tribunal (or any subsequent appeals) result in the rejection of the Resolution Plan, the Company may be ordered to be liquidated by the Adjudicating Authority/ Appellate Tribunal/subsequent appellate authority.

3 During the year, the Company has incurred a net loss of Rs. 18206.82 crores and as of 31 March 2018, the Company’s accumulated losses amounted to Rs. 17943.92 crores, as against the Company’s Net worth of Rs. 2995.74 crores as at 31 March 2017. Total liabilities of the Company as on 31 March 2018 exceeded total assets by Rs. 15200.53 crores.

4 During the financial year, the Company discontinued its business of trading in fabrics with effect from 01 July 2017. The Management has informed the RP that the trading business with a highly fragmented customer base experienced significant tightening of liquidity and has resulted into continuing payment defaults by customers. The Company has written off Rs. 585.51 crores and made provision for the entire balance amount of outstanding trading debtors of Rs. 10,952.51 crores during the year as per the Accounting policy followed by the Company.

In compliance with his duties under the Code, the RP has made an application under Section 60(5) seeking directions of the Adjudicating Authority for further steps in this matter. The said application is currently pending adjudication before the Adjudicating Authority.

5 The net deferred tax assets as on 31 March 2018 is Rs. 1423.11 crores (Previous Year Rs. 1423.11 crores). The Resolution Plan for the Company is under consideration of the Adjudicating Authority. Reliable projections of future taxable income, therefore, shall be available only when the Resolution Plan is implemented. Accordingly, deferred tax assets for the current period and the Financial Year are presently not recognised and the net deferred tax assets as at the end of the previous financial year has been carried forward.

6 In the opinion of management, the current assets and other non-current assets after necessary provisions / write offs have a value on realisation in the ordinary course of the business, at least equal to the amount at which they are stated; except reported otherwise.

7 Interest includes Penal interest claimed by the financial creditors and admitted by the RP till 18 July, 2017.

8 Revenue from operation for the period up to 30 June 2017 includes excise duty which is discontinued with effect from 01 July 2017 upon implementation of Goods & Service Tax (GST). In accordance with Ind AS 18 Revenue GST is not included in Revenue from operations.

9 Share based payments

Pursuant to the ESOS scheme 2010, the Company granted 23,044,650 options on 28 September 2013. At an exercise price of Rs.10/- each, out of which 17,116,500 options were outstanding as on 31.03.2016 and same have been lapsed on 28^th September 2016. This has been noted in the Board Meeting dated 13.12.2016. Thereafter there are no options granted to the employees.

10 Disclosures Pursuant to - “Employee benefits”:

i) Defined contribution plans:

Amounts recognized in the Statement of Profit and Loss under the head Employee Benefits Expense towards contributions to Provident Fund, and other similar funds by the Company are Rs. 4.57Crores (Previous year Rs. 4.77Crores).

ii) Defined benefit plans:

a) Gratuity Plan: The Company makes annual contribution to the Employee’s Group Gratuity Assurance Scheme, a funded defined benefit plan for qualifying employees. The Fund invests in the scheme of insurance with the Life Insurance Corporation of India, First Life Insurance Company Limited, SBI Life Insurance Company Limited and Canara HSBC Oriental Bank of Commerce. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

b) Compensated absences: Employees’ entitlement to compensated absences in future periods based on leaves not availed as at balance sheet date, as per the policy of the Company, is expected to be a long term benefit and is actuarially valued.

The following table sets out the status of the gratuity plan for the year ended 31 March 2018 as required under Ind AS 19.

* Expected rate of return on plan assets is based on expectation of the average long term rate of return expected to prevail over the estimated term of the obligation on the type of the investments assumed to be held by respective insurance companies, since the fund is managed by Insurer. The estimates of future salary increases, considered in actuarial valuation, takes into account the inflation, seniority, promotions and other relevant factors.

Asset Allocation:

Since the investments are held in the form of deposit with the fund managers, these are not volatile and the market value of assets is the cost value of assets and has been accordingly considered for the above disclosure.

11 Segment Information:

The Company has presented data relating to its segments based on its consolidated financial statements, which are presented in the same annual report. Accordingly, in terms of the provisions of Indian Accounting Standard (Ind AS) 108 “Operating Segments”, no disclosures related to segments are presented in these stand-alone financial statements.

12 Capital Management and Financial Management Framework:

The Company was admitted under the Corporate Insolvency Resolution Process (CIR) Process as per provision of the Insolvency and Bankruptcy Code 2016 (the Code) on 18 July 2017.and Mr. Ajay Joshi has been appointed as the Resolution Professional (RP) in terms of the Code.

A resolution Plan submitted by JM ARC and Reliance Industries has been approved by the Committee of Creditors (CoC) in their meeting held on 20 June 2018 by the requisite votes and an application for approval of the Resolution Plan by the Hon’ble NCLT has been filed by the RP. The said application is currently under adjudication.

If and when the Resolution Plan is approved by the Hon’ble NCLT, the resultant changes in the Capital Structure of the company would be known and the new management would then take steps to implement the same. The framework and the strategies for effective capital management, thus, will be established post the implementation of the Resolution Plan.

Presently, the Capital and Financial Management activities are restricted to management of current assets and liabilities of the company and the day to day cash flow. The company is focused on realization of receivables and inventory management to unlock, to the extent possible, funds blocked in the current assets of the company.

Similarly, the financial risk profile and the strategies for mitigation of such risks will be established by the new management post the implementation of the Resolution Plan. The key risks associated with day to day operations of the company and working capital management are provided below:

A. Credit Risk:

Credit risk is the risk that counter party will not meet it obligation under a financial instrument or customer contract leading to a financial loss. The Company expose to credit risk mainly from trade receivables and other financial assets.

i) Trade Receivables:

Customer credit is managed by each business division subject to the Company’s established policy procedures and control related to customer credit risk management.

The Company considers its export related debtors as low risk area. Most of its export customers are reputed international parties / traders. The major portions of exports are against Letter of Credit and only with old and reputed customers it’s on DA/ DP basis. In some cases, insurance cover on export outstanding is also taken.

During the financial year, the Company discontinued its business of trading in fabrics with effect from 01 July 2017. The Management has informed the RP that the trading business with a highly fragmented customer base experienced significant tightening of liquidity and has resulted into continuing payment defaults by customers. The Company has written off Rs. 585.51 crores and made provision for the entire balance amount of outstanding trading debtors of Rs. 10,952.51 crores during the year as per the Accounting policy followed by the Company.

In compliance with his duties under the Code, the RP has made an application under Section 60(5) seeking directions of the Adjudicating Authority for further steps in this matter. The said application is currently pending adjudication before the Adjudicating Authority.

The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets.

ii) Other Financial Assets

Presently, other financial assets comprise of Fixed Deposits as margin for Letter of Credit/ Bank guarantees, Export incentives, GST refund / rebate on Exports receivable, advance given to vendors etc. These are considered as low risk items in the in the normal course of business and are subject to operational controls deemed sufficient by senior management.

B. Market Risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risks - interest rate risk, currency risk and other price risk in a fluctuating market environment. Financial instrument affected by market risks includes loans and borrowings, deposits, derivatives and other financial assets. Since the company is presently under the CIR process it is not required to meet any loan or interest obligation till the Resolution Plan is implemented if and when approved.

i) Currency Risk

This is the risk that the Company may suffer losses as a result of adverse exchange rate movement during the relevant period. The Company has exports and to that extent it has natural hedge to cover foreign exchange risk on account of imports. Thus to that extent it is able to mitigate fluctuations in currency rates. The company being under the CIR Process, it has no limits available to enter into derivative contracts for mitigation of currency risk on its net exposure.

Foreign Currency Sensitivity

The following tables demonstrate the sensitivity to a reasonably possible change in USD and EUR exchange rates, with all other variables held constant. The impact on the Company’s profit before tax is due to changes in the fair value of monetary assets and liabilities including non-designated foreign currency derivatives. The Company’s exposure to foreign currency changes for all other currencies is not material.

P&L impact during the year including impact on fixed assets and unhedged exposure is as follows:

Impact on P&L of Rs. 72.11 crore (negative if change in rate is upward), on Fixed Assets of Rs. 52.18 crores (positive if change in rate is upward)

In management’s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year.

ii) Interest rate risk

In the normal circumstances, the Company manages interest rate risk by having a balanced portfolio of fixed and variable rate of interest on loans and borrowings. However, since the company is presently under CIR Process, it is not required to meet any interest obligation till the final resolution is reached.

Interest rate sensitivity

Not relevant as explained above.

iii) Investment in Equity Price Risk

The Company is exposed to normal risks associated with equity investments. Equity investments are held for strategic rather than trading purposes. The Company does not actively trade these investments. During the year the company has made provision for diminution in value of its investments in subsidiary companies amounting to Rs. 27.10 crore (Previous year Rs. 132.69 crore).

C. Liquidity Risk:

i) Liquidity risk management

Being under the CIRP, the company does not have any sources of funds infusion save for the Interim Finance of Rs. 150 Crores raised in September 2017 and short term loan of Rs. 20 Crores from State Bank of India prior to commencement of the CIR process. The company has to manage its cash flows on a day to day basis to maintain operations that for the most of the year have been about 30% Capacity Utilization. The company is dependent upon timely receipt of sales proceeds and delays in sales realizations can severely impact the current level of operations.

ii) Maturities of financial liabilities

Since the company is presently under CIR Process, it is not required to meet any loan repayment or interest obligation.

iii) Financing arrangements

Since the company is presently under CIR Process, no banking facilities were available to the company save for the Interim Finance raised of Rs. 150 Crores and a short term loan of Rs. 20 Crores raised prior to the commencement of the CIR Process.

iv) Maturities of financial assets

The following table details the Company’s expected maturity for its non-derivative financial assets. The table has been drawn up based on the undiscounted contractual maturities of the financial assets including interest that will be earned on those assets. The inclusion of information on non-derivative financial assets is necessary in order to understand the Company’s liquidity risk management as the liquidity is managed on a net asset and liability basis.

13 Fair value Measurement

Set out below, is a comparison by class of the carrying amounts and fair value of the Company’s financial instruments that are recognised in the financial statements.

The Company maintains policies and procedures to value financial assets or financial liabilities using the most relevant data available. In addition, the Company as and when required, also engages independent pricing advisors to assist in corroborating the valuations of certain instruments.

The fair value of the financial assets and liabilities are included at the amount at which the instrument that would be received to sell an asset or paid to transfer liability in an orderly transaction between market participants at the measurement date.

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

i) Fair value of security deposits have been estimated using a DCF model. The valuation requires management to make certain assumptions about interest rates, maturity period, credit risk, forecasted cash flows.

ii) Long-term fixed-rate and variable-rate receivables/borrowings are evaluated by the company based on parameters such as interest rates, individual creditworthiness of the customer and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables. As of reporting date the carrying amounts of such receivables, net of allowances are not materially different from their calculated fair values.

iii) Carrying value of loans from banks, other noncurrent borrowings and other financial liabilities is estimated by discounting future cash flows using rates currently available for debt on similar terms, credit risk and remaining maturities. The own non-performance risk as at reporting date was assessed to be insignificant.

Fair value hierarchy

The following table provides the fair value measurement hierarchy of Company’s assets and liabilities grouped into Level 1 to Level 3 as described in significant accounting policies - Note 1(j). Further table describes the valuation techniques used, key inputs to valuations and quantitative information about significant unobservable inputs for fair value measurements.

During the year ended 31 March 2018 and 31 March 2017 there were no transfers between level 1 and level 2 fair value measurements and no transfers into and out of level 3 fair value measurement.

The management assessed that cash and cash equivalents, trade receivables, trade payables, cash credit and all other current financial assets and liabilities approximates their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

- Receivables are evaluated by the company based on parameters such as interest rates and individual credit worthiness of the customer. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

- The fair value of loans from banks and other financial liabilities, security deposit, as well as other financial liabilities is presently considered same as carrying value as the eventual capital structure and associated attributes to determine fair value will be known only when the Resolution Plan is implemented. The Company being under the CIR Process, the treatment of the loans shall be in accordance with the resolution plan and therefore it is not possible to forecast what would be the carrying value of the loans for applying fair value measurement.

- The fair values of the unquoted equity instruments have been estimated using a net adjusted fair value method. The valuation requires management to make certain assumptions about the assets, liabilities, investments of Investee Company. The probabilities of the various assumptions can be reasonably assessed and are used in management’s estimate of fair value for these unquoted equity investments based on the best information available to the Company.

- The fair values of quoted equity instruments are derived from quoted market prices in active markets.

- The Company presently has not entered into any foreign exchange forward contracts.

- Since the company is under CIR Process, there is no obligation to service borrowings. Interest on all borrowings is being accrued as per the interest rate prevailing on the date of the commencement of CIRP viz 18^th July 2017. All the four documents contain lot of factual data as well as discussion on economy and those which does not entail any interpretation and therefore we do not expect you to make any changes there.

14 Operating Lease

The Company has lease agreement for various premises which are in the nature of operating lease. The tenure of Lease arrangement ranges up to 1 year which are cancellable lease. There is no obligation for renewal of these lease agreements and are renewable by mutual consent. Lease payment recognised in the Statement of Profit & Loss is Rs. 9.42crores (previous year Rs. 8.30 crores).

15 Disclosure pursuant to Security and Exchange board of India (Listing Obligations and Disclosures requirements) regulation, 2015 and section 186(4) of the Companies Act, 2013 are as under:

a. Loans and advances in the nature of loans given to subsidiaries/entities under common control utilised for the business purpose are as under :

b. Investments made - Refer Note No. 5

c. Corporate Guarantees given by the Company in respect of loans taken by subsidiary companies (proposed to be utilised for business)

Note:

* During the year on 02.03.2018 the guarantee given for Grabal Alok (UK) Ltd. of USD 14.50 million equivalents to Rs. 96.57 crore was invoked by lender and converted to loan in the books of Alok Industries Ltd.

** During the year on 01.07.2017 the Company received demand notice from lender of Alok International (Middle East) FZE for guarantee given and demanded the outstanding amounts of USD 5.70 million equivalent to Rs. 36.04 crore and the same now converted to loan in the books of Alok Industries Ltd.

d. Security provided - Refer Note no. 12 (utilised for business purpose)

16 Corporate Social Responsibility

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the company as per the Act. For the current financial year 2017-18, as the average profits for the last three years is negative, the Company does not have to spend any amount on CSR.

The Company has not been able to spend any amount towards CSR due to paucity of funds/the company having been admitted for a CIRP.

17 In view of the liquidity crunch since 2014, the Company has stopped paying debenture interest and such interest payment is due for a period beyond one year as at the Balance Sheet date. A clarification was sought by the Regional Director, Ministry of Company Affairs (RD), amongst others, as to why this non-payment for financial year ending 31.03.2016, should not be treated as a violation of Section 164(2) and 167 of the Companies Act, 2013. The Company responded that it had availed financial assistance by way of issuance of non-convertible redeemable debenture on a private placement basis and not a public issue. The Company further stated that a close reading of Section 164(2) would reveal that its provisions would be attracted when the Company accepts debentures and deposits from many (i.e. public at large) and not from a single entity on a private placement basis. Accordingly, directors retiring by rotation at the ensuing Annual General Meeting and eligible for reappointment, continue to render themselves eligible for such reappointment.

18 Impairment of fixed assets

The Company current level of operations, at about 30% of the capacity, may not be an indication of the future performance of the Company. A Resolution Plan for revival of the Company is under consideration of the Adjudicating Authority. Therefore, until a resolution plan has been implemented, reliable projections of availability of future cash flows of the Company supporting the carrying value of Property, Plant and Equipment cannot be determined, hence are not available. Accordingly Impairment testing under Ind AS has not been performed while presenting these results.

19 Unhedged foreign currency exposure

The Company did not take any derivative instruments during the current year / previous year.

20 Reconciliation of tax

A reconciliation of income tax expense applicable to accounting profit / (loss) before tax at the statutory income tax rate to recognised income tax expense for the year indicated are as follows

21 Previous period’s figures have been regrouped / reclassified wherever necessary to correspond with the current period’s classification / disclosure and are given in brackets.

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Mar 31, 2016

1. As a consequence of the prolonged working at depleted levels, the Company''s losses have significantly mounted leading to a decrease in the net worth. The company will take due measures to inform concerned authorities of this development in due course.

Certain events / conditions could possibly impact the ‘going concern'' assumption of the Company. The lenders had invoked the ‘Strategic Debt Restructuring'' (SDR) on 27 Nov 2015 pursuant to Reserve Bank of India guidelines and the implementation thereof is under process. Considering this development, the Company has presented these financial statements on a ‘going concern'' basis.

2. Company has unabsorbed depreciation and business losses as at the Balance Sheet date on which net deferred tax assets of Rs 1051.85 crore has been recognized based on the concrete measures taken by the Company for ramping up operations and enhancing operating efficiency. Based on timely infusion of working capital, running order book position, reliability of raw material supply and the technical viability report prepared by recognized industry experts, the company is virtually certain that there would be sufficient taxable income in future to offset the deferred tax asset.

3. Pursuant to the applicability of Schedule II to the Companies Act, 2013, with effect from April 01, 2015, the Company has aligned the useful lives of its tangible assets with those specified In Schedule II or as assessed based on technical advice. Consequently, the depreciation charge for the year ended 31^st March,2016 is lower by Rs. 290.63 crores.

4. In the opinion of management, the current assets and other non-current assets after necessary provisions / write offs have a value on realization in the ordinary course of the business, at least equal to the amount at which they are stated except otherwise stated.

5. Employee benefit plans:

i) Defined contribution plans:

Amounts recognized as expenses towards contributions to provident fund, and other similar funds by the Company are Rs. 4.83 Crores (Previous period Rs. 6.97 Crores).

ii) Defined benefit plans:

a) Gratuity Plan: The Company makes annual contribution to the Employee''s Group Gratuity Assurance Scheme, a funded defined benefit plan for qualifying employees. The Fund invests in the scheme of insurance with the Life Insurance Corporation of India, First Life Insurance Company Limited, SBI Life Insurance Company Limited and Canara HSBC Oriental Bank of Commerce. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

b) Compensated absences: Employees'' entitlement to compensated absences in future periods based on unveiled leave as at balance sheet date, as per the policy of the Company, is expected to be a long term benefit and is actuarially valued.

6. Operating Lease

The Company has lease agreement for various premises which are in the nature of operating lease. The tenure of Lease arrangement ranges up to 1 year which are cancellable lease. There is no obligation for renewal of these lease agreements and are renewable by mutual consent. Lease payment recognized in the Statement of Profit & Loss is Rs.16.30 crores (previous period Rs. 29.09 crores).

7. Disclosure Pursuant to Security and Exchange board of India ( Listing Obligations and Disclosures requirements) regulation, 2015 and section 186(4) of the Companies Act, 2013 are as under:

a. Loans and advances in the nature of loans given to subsidiaries/entities under common control utilized for the business purpose are as under :

8. Corporate Social Responsibility

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the company as per the Act. The funds were primarily allocated to a corpus and utilized through the year on these activities which are specified in Schedule VII of the Companies Act, 2013.

9. Certain creditors/lenders have filed winding up petitions in the Bombay Court for non-payment of their dues / installments / interest etc. The Company has taken appropriate measures to defend itself in this regard.

10. The Company is yet to pay the debenture interest payment due for a period beyond one year as at the Balance sheet date. This attracts the provisions of Section 164 (2) of the Companies Act, 2013 as per which all directors retiring by rotation at the ensuing Annual General Meeting and eligible for reappointment render themselves ineligible for such reappointment. Further, Section 167 of the said Act appears ambiguous regarding the vacation of the Board, if and when such a contravention continues. The Company is informed that the Company Law Committee appointed by the Government of India has already recommended appropriate amendments to Section 167 to remove the apparent ambiguity. The Company is further informed the recommendation has been incorporated in the Companies (Amendment) Bill, 2016 which has been introduced in the Lok Sabha for discussion and is pending for confirmation.

11. The previous financial year of the Company was for a period of 18 months from 1 October 2013 to 31 March 2015, whereas the current financial year of the Company is for a 12 months from 1 April 2015 to 31 March 2016. The figure of the two periods are therefore not strictly comparable.

12. Previous period''s figures have been regrouped / reclassified wherever necessary to correspond with the current period''s classification / disclosure and are given in brackets.

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Mar 31, 2015

1 BACKGROUND INFORMATION

Alok Industries Limited ("The Company") is a public limited company, domiciled in India and incorporated under the provisions of the Companies Act, 1956. The equity shares of the Company are listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). It is primarily engaged in the business of textile manufacturing including mending and packing activities.

2 Contingent Liabilities in respect of :

(Rs. Crores) Sr.No. Particulars Current Previous Period Period A Custom duty on shortfall in export Amount Amount obligation in accordance with Unascertained Unascertained EXIM Policy (The Company is hopeful of meeting the export obligation within the stipulated period)

B Corporate guarantees given to banks for loans taken by subsidiary companies 1747.44 2,642.48

C Bills discounted 33.77 365.18

D Claims against the Company not acknowledged as debts :

a) Income taxes 6.18 0.31

b) Maharashtra value added tax 8.07 8.07

c) Other tax demands 1.57 1.57

d) Others - disputes under litigation - 19.34

3 Related Party Disclosure

A) Name and Transaction / balances with related parties

I. Name of related parties and nature of relationship

As per Accounting Standard 18 (AS-18) "Related Party Disclosures", Company''s related parties disclosed as below:

(i) Associate companies

Alspun Infrastructure Limited Next Creation Holdings LLC

Ashford Infotech Private Limited (up to 7 April 2014)

(ii) Entities under common control

Alok Denims (India) Private Limited Nirvan Exports

Alok Knit Exports Limited Pramatex Enterprises

Alok Textile Traders Ashok Realtors Private Limited

Buds Clothing Co. D. Surendra & Co. Triumphant Victory Holdings Limited.

(iii) Subsidiaries

Alok Industries International Ltd. @ Alok Infrastructure Limited

Alok New City Infratex Private Limited Springdale Information and Technologies Private Limited #

Alok International, Inc. Kesham Developers & Infotech Private Limited #

Alok International (Middle East) FZE Alok Singapore Pte Ltd.

Alok Worldwide Limited

Grabal Alok (UK) Limited

Mileta, a.s. Grabal Alok International Alok Grabal Trading Limited @ (Middle East) FZE Alok Merchant Singapore Pte. Ltd. (Incorporated on 7 July 2014) (Incorporated on 7 March 2014) Alok Global Singapore Pte. Ltd. Alok Universal Singapore Pte.Ltd. (Incorporated on 7 March 2014) (Incorporated on 7 March 2014) Alok Trading Singapore Pte. Ltd. (Incorporated on 7 March 2014) # Liquidation under process @ Entire stake sold to Alok Infrastructure Limited on 28 March 2012

(iv) Joint Venture

Aurangabad Textiles & Apparel Parks Limited New City Of Bombay Mfg. Mills Limited

(v) Key Management Personnel Ashok B. Jiwrajka Chandrakumar Bubna (Resigned w.e.f 30 September 2013) Dilip B. Jiwrajka Director Surendra B. Jiwrajka Sunil O Khandelwal (appointed as Executive Director Director w.e.f. 10 November 2012) K H Gopal (appointed as Executive Director w.e.f.10 November 2012) Alok A. Jiwrajka - COO (w.e.f.1 December 2012) Varun S Jiwrajka - Joint COO (w.e.f.1 December 2012) Neeraj D. Jiwrajka - Joint COO (w.e.f.1 December 2012)

(vi) Relatives of Key Alok A. Jiwrajka (up to Management Personal 30 November 2012) Suryaprakash Bubna (resigned w.e.f.28 February 2013)

(VII) Firms in which AVAN Packaging & Boards Relatives of Key Linear Design Management Personnel C. J. Corporation are interested

4 Employee benefit plans:

i) Defined contribution plans:

Amounts recognized as expenses towards contributions to provident fund, superannuation and other similar funds by the Company are Rs. 6.97 Crores (Previous period Rs. 9.60 Crores) for the period ended 31 March 2015.

ii) Defined benefit plans:

a) Gratuity Plan: The Company makes annual contribution to the Employee''s Group Gratuity Assurance Scheme, administered by the Life Insurance Corporation of India (''LIC''), a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

b) Compensated absences: Employees'' entitlement to compensated absences in future periods based on unavailed leave as at balance sheet date, as per the policy of the Company, is expected to be a long term benefit and is actuarially valued.

5 Segment Reporting

a) Primary Segment: Geographical Segment

The company has identified geographical segment as its primary segment.

The geographic segment consists of:

a) Domestic (Sales to customers located in India)

b) International (Sales to customers located outside India)

Revenue directly attributable to segments is reported based on items that are individually identifiable to that segment. The company believes that it is not practical to allocate segment expenses, segment results, assets used, except trade receivables, in the company''s business or liabilities contracted since the resources / services / assets are used interchangeably within the segments. Accordingly, no disclosure relating to same is made. All fixed assets are located in India.

6 Exceptional items during the previous period included unrealized exchange fluctuation on foreign currency assets/ liabilities and foreign exchange derivative contracts of Rs. 317.39 crores , considering the unusual volatility of Indian Rupee against US dollar, and Rs. 146.35 crores on write off of investments/ advances in respect of subsidiaries in retail business.

7 The Company has extended the accounting year end from 30 September 2014 to 31 March 2015 to align with the requirements of having 31 March as the year end as required under the Companies Act, 2013. Accordingly, the current accounting period is for 18 months from 1 Oct 2013 to 31 Mar 2015. The previous accounting period of the Company was also for 18 months from 1 April 2012 to 30 September 2013. The figures of the two periods are therefore not strictly comparable.

8 Previous period''s figures have been regrouped / reclassified wherever necessary to correspond with the current period''s classification / disclosure.

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Sep 30, 2013

1) Accounting for Derivatives

i. The company uses derivative instruments like foreign currency forward contracts, foreign currency options and Interest rate swaps to hedge its exposure to movements in foreign exchange rates, interest rates and currency risks. The objective of these derivative instruments is to reduce the risk or cost to the company and is not intended for trading or speculation purposes.

ii. Interest Rate Swaps, Foreign Currency Options and Currency Swaps, entered into by the Company for hedging the risks of foreign currency exposure (including interest rate risk) are accounted based on the principles of prudence as enunciated in Accounting Standard 1 (AS-1) "Disclosure of Accounting Policies". Thus, mark to market loses (net) are accounted for by the company, net gains are ignored.

iii. In respect of foreign currency forward contracts entered into to hedge foreign currency exposure in respect of recognized monetary items, the premium or discount on such contracts is amortized over the life of the contract. The exchange difference measured by the change in exchange rate between the inception dates of the contract/ last reporting date as the case may be and the balance sheet date is recognized in the statement of profit and loss. Any gain / loss on cancellation of such forward contracts are recognised as income / expense of the period.

iv. The Company designates foreign currency forward contracts taken with respect to highly probable forecast transactions and firm commitments as hedges and accounts for the same by applying the recognition and measurement principles set out in the Accounting Standard (AS-30) "Financial Instruments: Recognition and Measurement". Accordingly, the Company records the gain or loss on effective cash flow hedges in the Cash Flow Hedging Reserve account until the forecasted transaction materializes. Gain or loss on ineffective cash flow hedges (if any) is recognized in the statement of profit and loss. (efer Note No. 33(ii)).

2. EMPLOYEE STOCK OPTION SCHEME (ESOS)

All outstanding Options granted under Grant 1 and Grant 2 of ESOS 2010 scheme issued in the previous year are voluntarily surrendered by Employees during the current period and accordingly, Company has reversed employee compensation expenses of Rs. 2.27 crores recognised in previous year.

Pursuant to ESOS scheme 2010 approved by the shareholders, vide postal ballot, in 2011, Company granted 23,044,650 shares (Grant 3) on September 28, 2013. Such options vest over a period of 1 year from grant date. Details of options granted under Grant 3 duly approved by the Remuneration and Compensation Committee under the said scheme are as under:

The Company has followed the intrinsic value-based method of accounting for stock options granted, based on Guidance Note on Accounting for Employee Share-based Payments, issued by the Institute of Charted Accountants of India and accordingly compensation cost has not been recorded during the period on such grant since the market price was less than the exercise price at the date of grant. Had the compensation cost for the Company''s stock based compensation plan been determined in the manner consistent with the fair value approach as described in the Guidance note, Company''s net income would be lower by Rs. 0.03 crore, without any change in the earning per share, as reported.

The Company has adopted Black Scholes option pricing model to determine fair value of stock options. The fair value of each options granted under Grant 3 in current period is estimated on the date of grant based on the following assumptions:

3. EMPLOYEE BENEFIT PLANS:

i) Defined contribution plans:

Amounts recognized as expenses towards contributions to provident fund, superannuation and other similar funds by the Company are Rs. 9.60 crores (Previous Year Rs. 9.27 crores) for the period ended 30 September 2013.

ii) Defined benefit plans:

a) Gratuity Plan: The Company makes annual contribution to the Employee''s Group Gratuity Assurance Scheme, administered mainly by the Life Insurance Corporation of India (''LIC''), a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

b) Compensated absences: Employees'' entitlement to compensated absences in future periods based on unavailed leave as at balance sheet date, as per the policy of the Company, is expected to be a long term benefit and is actuarially valued.

The following table sets out the status of the gratuity plan for the period ended 30 September 2013 as required under AS 15 (Revised)

4. SEGMENT REPORTING

a) Primary Segment: Geographical Segment

The company is in the business of manufacturing of Textile products. Considering its high level of international operations and present internal financial reporting based on geographical location of customer, the company has identified geographical segment as primary segment.

The geographic segment consists of:

a) Domestic (Sales to Customers located in India)

b) International (Sales to Customers located outside India)

Revenue directly attributable to segments is reported based on items that are individually identifiable to that segment. The company believes that it is not practical to allocate segment expenses, segment results, assets used, except trade receivables, in the company''s business or liabilities contracted since the resources/services/assets are used interchangeably within the segments. Accordingly, no disclosure relating to same is made. All fixed assets are located in India.

b) Secondary Segment: Business Segment

The company is operating in a single business i.e. Textile and as such all business activities revolve around this segment. Hence, there is no separate secondary segment to be reported considering the requirement of AS 17 on "Segment Reporting"

5. i. Fair values (Mark to market values) (loss) of Foreign currency options, Interest rate swaps and forward contracts (other than those considered for hedging) as at 30 September 2013 aggregating to Rs. 150.47 crores (previous year Rs. 179.57 crores) has been accounted for by the Company. Such fair values are based on the report of counter parties. MTM gain on such derivatives of Rs. 29.10 crores (previous year loss of Rs. 106.61 crores) have been recognised during the period.

ii. Derivative contracts entered into by the company and outstanding as on 30 September 2013 for hedging currency and interest rate related risks. Nominal amounts of derivative contracts entered into by the company and outstanding as on 30 September 2013 amount to Rs. 1,202.95 crores (previous year Rs. 3,477.99 crores). Category wise break-up is given below.

6 During earlier year, Deutsche Bank, Singapore Branch subscribed to unsecured floating rate compulsory convertible bonds issued by Alok Industries International Limited ("Alok BVI") and Grabal Alok (UK) Ltd, a company incorporated in the United kingdom (subsidiary) of the company, of USD 56.5 million each, with a green shoe option of USD 25 million. These bonds are secured by subservient charge on current and movable assets of the company which was created by executing a Deed of Hypothecation on 28 October 2010 in favour of AXIS Trustee Services Limited, Mumbai, India.

7 The company has transferred investments in the form of equity capital in its wholly owned subsidiary namely, Alok H & A Ltd ("Alok H&A"), Alok Land Holdings Private Ltd ("Alok Landholdings"), Alok Retail (India) Ltd. ("Alok Retail") & Alok Apparel Private Ltd. ("Alok Apparel") to Alok Infrastructure Limited ("Alok Infra"), another wholly owned subsidiary. Consequent to such sale of shares, Alok Infra became the immediate holding Company for these subsidiaries in March 2013. Further, vide scheme of amalgamation approved by the Bombay High Court, all such subsidaries were amalgamated with Alok Infra effective 1 April 2012.

8 In line with the amended Accounting Standard (AS) 11 - ''Effect of changes in Foreign Exchange Rates'', the Company has chosen to exercise the option under paragraph 46 inserted in the Standard by the notification.

i. Added to fixed assets/ capital work-in-progress Rs. 234.73 crores (previous year Rs. 114.47 crores) being exchange difference on long term monetary items relatable to acquisition of fixed assets.

ii. Carried forward Rs. 4.56 crores (previous year Rs. 0.98 crore) in the ''Foreign Currency Monetary Item Translation Difference Account'' being the amount remaining to be amortised as at 30 September 2013.

9 Exceptional Items Include :

i) Exchange loss/ gain arising out of a) restatement of foreign currency liabilities/ assets and b) Mark to market (MTM) losses on foreign exchange derivatives taken by the Company, considering the unusual fluctuation in the Indian Rupee (INR) against US Dollar (USD) aggregating to Rs. 317.39 crores (Previous year Rs. 121.27 crores).

ii) Advances written off Rs. 109.25 crores and loss on sale of investment Rs. 37.10 crores in respect of subsidiaries in the retail business during the period ended 30 September 2013.

10 The Company has extended its accounting year end from 31 March 2013 to 30 September 2013. Accordingly, figures for the current year are for a period of 18 months from 1 April 2012 to 30 September 2013, whereas figures for the previous year are for a period of 12 months and hence such figures are not comparable.

11 Previous year''s figures have been regrouped/reclassified wherever necessary to correspond with the current period''s classification/disclosure.

---

Mar 31, 2012

1 Contingent Liabilities in respect of :

Sr. No. Particulars Current Year Previous Year

A Customs duty on shortfall in export obligation in accordance Amount Amount with EXIM Policy Unascertained Unascertained

(The company is hopeful of meeting the export obligation within the stipulated period)

B Pending Litigation 0.05 0.05

C Guarantees given by banks on behalf of the Company 73.48 24.69

D Corporate Guarantees given to bank for loans taken by 977.62 213.35 Subsidiary Companies

E Bills discounted 214.79 242.94

F Taxation Matters :

a) Income tax demand mainly on account of alleged 1.69 - short deduction of taxes for Ay 2010-11 and AY 2011-

12 on certain payments. The company has filed an appeal with the Commissioner of Income Tax (A) and is hopeful of favourable decision.

b) Income Tax demand during the previous years of 0.23 5.91 Rs 5.91 crore mainly on account of alleged short deposition of TDS amounts arising from wrong TAN numbers mentioned while uploading the TDS return and certain payments not considered by the Tax authorities, although duly paid by the company and short deduction of tax in respect of certain payments with respect to AY 2006-07 to 2009-10. The company had filed an appeal with the Commissioner of Income Tax (A) and also made application for rectification u/s 154 providing details of amounts paid to the bank.

Such rectification was carried out during the year for majority of the amount and for the balance of Rs 0.23 crore mainly pertaining to short deduction of taxes, the company is hopeful of favourable decision.

c) Demands of Works Contract Tax contested not 0.59 0.59 acknowledged as debts as the company is hopeful of favourable decision.

d) Income tax amounting to Rs 11.29 crore, mainly on 11.29 - account of disallowance of interest and expenditure incurred towards exempt income. The company has filed an appeal with the Commissioner of Income Tax (A) and is hopeful of favourable decision.

2 Related Party Disclosure

A) Name and Transaction / balances with related parties

I. Name of related parties and nature of relationship

As per Accounting Standard 18 (AS-18) "Related Party Disclosures", Companys related parties disclosed as below:

3 Employee Stock Option Scheme(ESOS)

In 2011, the shareholders of the Company approved the Employee Stock Option Scheme ("Alok Industries Limited - ESOS 2010 Scheme") vide postal ballot, in accordance with the Securities and Exchange Board of India (ESOP & ESOS) Guidelines, 1999. Such scheme provides for grant of options up to 2,50,00,000 options to the eligible employees and /or directors of the Company and / or its subsidiaries. The exercise price for such options can be up to 50% discount to the market price as per the discretion of the compensation committee. 1,07,91,500 options were granted during the year and 1,05,87,950 options were outstanding as on 31 March 2012. Such options vest over a period of two years, 50% at the end of one year from the date of grant and 50% at the end of two years from the date of grant.

Details of options granted duly approved by the Remuneration and Compensation Committee under the said scheme are as under:

The Company has followed the Intrinsic Value-based method of accounting for stock options granted, based on Guidance Note on Accounting for Employee Share-based Payments, issued by the Institute of Chartered Accountants of India, and accordingly, compensation cost of Rs 4.67 crore has been recorded during the year on such grant. The compensation cost recognised as a charge during the year was Rs 2.27 crore. Had the compensation cost for the Companys stock based compensation plan been determined in the manner consistent with the fair value approach as described in the Guidance note, the Companys net income would be lower by Rs 4.20 crore and earnings per share as reported would be lower as indicated below:

4 Employee benefit plans:

i) Defined contribution plans:

Amounts recognized as expenses towards contributions to provident fund, superannuation and other similar funds by the Company are Rs 10.58 Crore (Previous Year Rs 8.08 crore) for the year ended 31 March 2012.

ii) Defined benefit plans:

a) Gratuity Plan: The Company makes annual contribution to the Employees Group Gratuity Assurance Scheme, administered by the Life Insurance Corporation of India (LIC), a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

b) Compensated absences: Employees entitlement to compensated absences in future periods based on unavailed leave as at balance sheet date, as per the policy of the Company, is expected to be a long term benefit and is actuarially valued.

The following table sets out the status of the gratuity plan for the year ended 31 March 2012 as required under AS 15 (Revised)

* Expected rate of return on plan assets is based on expectation of the average long term rate of return expected to prevail over the estimated term of the obligation on the type of the investments assumed to be held by LIC, since the fund is managed by LIC. The estimates of future salary increases, considered in actuarial valuation, takes into account the inflation, seniority, promotions and other relevant factors.

Asset Allocations

Since the investments are held in the form of deposit with LIC, these are not volatile and the market value of assets is the cost value of assets and has been accordingly considered for the above disclosure.

5 Segment Reporting

a) Primary Segment: Geographical Segment

The company is in the business of manufacturing of Textile products. Considering its high level of international operations and present internal financial reporting based on geographical location of customer, the company has identified geographical segment as primary segment.

The geographic segment consists of:

a) Domestic (Sales to Customers located in India)

b) International (Sales to Customers located outside India)

Revenue directly attributable to segments is reported based on items that are individually identifiable to that segment. The company believes that it is not practical to allocate segment expenses, segment results, assets used, except debtors, in the companys business or liabilities contracted since the resources / services / assets are used interchangeably within the segments. Accordingly, no disclosure relating to same is made. All fixed assets are located in India.

b) Secondary Segment: Business Segment

The company is operating in a single business i.e. Textile and as such all business activities revolve around this segment. Hence, there is no separate secondary segment to be reported considering the requirement of AS 17 on "Segment Reporting"

6 i. Due to unusual depreciation in the value of the Indian Rupee (INR) against US Dollar (USD) during the year, the exchange loss/ gain arising out of:

(i) Restatement of foreign currency liabilities/assets, and;

(ii) Mark to Market (MTM) losses on foreign exchange derivatives taken by the Company, has been presented as an exceptional item with corresponding changes for the previous year.

ii. The Company, during the year, based on the announcement of the ICAI (Accounting for derivatives), has accounted for derivative forward exchange contracts taken towards highly probable forecast transactions and firm commitments, at fair values considering the principles of recognition and measurement stated in AS-30 Financial Instruments: Recognition and Measurement. Consequent upon such change, the profit after tax for the year ended March 31, 2012 is higher by Rs16.78 crore and reserves and surplus are lower by an equivalent amount. Fair value (net loss) of the derivative instruments identified as cash flow hedges is Rs 16.78 crore as at March 31, 2012, which is expected to be reclassified to the profit and loss account over the next year.

iii. Fair values (Mark to market values) (loss) of Foreign currency options , Interest rate swaps and forward contracts (other than those considered for hedging) as at 31 March 2012 aggregating to Rs 179.57 crore (previous year Rs 72.96 crore) has been accounted for by the Company. Such fair values are based on the report of counter parties. MTM losses on such derivatives of Rs 106.61 crore have been recognised during the year.

iv. Derivative contracts entered into by the company and outstanding as on 31 March 2012 for hedging currency and interest rate related risks. Nominal amounts of derivative contracts entered into by the company and outstanding as on 31 March 2012 amount to Rs 3,477.99 Crore (previous year Rs 2,841.73 Crore). Category wise break-up is given below.

7 During the previous year, Deutsche Bank, Singapore Branch subscribed to unsecured floating rate compulsory convertible bonds issued by Alok Industries International Limited ("Alok BVI") and Grabal Alok (UK) Ltd, a company incorporated in the United kingdom (subsidiary) of the company, of USD 56.5 million each, with a green shoe option of USD 25 million. These bonds are secured by subservient charge on current and movable assets of the company which was created by executing a Deed of Hypothecation on 28 October 2010 in favour of AXIS Trustee Services Limited, Mumbai, India.

8 During the year, the company has transferred investments in the form of equity capital and cumulative redeemable preference shares in Alok Industries International Ltd ("Alok BVI") & Grabal Alok International Ltd ("Grabal BVI"), its two wholly owned subsidiary companies to Alok Infrastructure Limited ("Alok Infra"), another wholly owned subsidiary as a strategy to consolidate all investible assets under one umbrella. During the previous year, vide a novation agreement, the Company had taken over the obligation of Grabal Alok (UK) Ltd, (then an associate company of Alok BVI & Grabal BVI in the United Kingdom) towards its liability pertaining to a JPY/USD foreign currency derivative. Consequent to the sale of shares in Alok BVI and Grabal BVI to Alok Infra, Alok Infra has taken over such obligation of Alok Industries Ltd. during the current year.

9 During the year, the Honourable High Court, Bombay sanctioned the scheme of amalgamation (scheme) between the Company (transferee) and Grabal Alok Impex Limited (transferor) with appointed date of 1 April 2011. Grabal Alok Impex is in the business of manufacturing embroidery textiles. The scheme has been effective from 1 March 2012.

The Company issued 2,24,85,000 equity shares of Rs 10 each to shareholders of Grabal Alok Impex Limited (of which 19,00,000 shares were issued to Alok BenefitTrust) considering exchange ratio of 1:1 as per the scheme. There were no significant differences in accounting policies of two companies. The Company has accounted for such amalgamation under pooling of interest method as under;

Pursuant to the scheme, with effect from the Appointed Date up to and including the Effective Date, the transferor company is deemed to have been carrying on all business and activities in trust for Alok Industries Limited. Pending completion of relevant formalities of transfer of certain assets and liabilities pursuant to the Scheme, such assets and liabilities remain under the name of the Grabal Alok Impex Ltd.

On amalgamation of the Company and Grabal Alok Impex Ltd, Grabal Alok (UK) Ltd, an associate company of both companies, has now become a majority owned subsidiary of Alok Industries Ltd.

Current year figures of the Company include amount of revenue of Rs 160.96 crore & profit before tax of Rs 7.58 crore for the year and hence are not strictly comparable.

11 In line with the amended Accounting Standard (AS) 11 - Effect of changes in Foreign Exchange Rates, the Company has chosen to exercise the option under paragraph 46 inserted in the Standard by the notification.

i. Added to fixed assets/ capital work-in-progress Rs 114.47 crore (previous year Rs 23.48 crore) being exchange difference on long term monetary items relatable to acquisition of fixed assets.

ii. Carried forward Rs 0.99 crore (previous year Rs (0.22) crore) in the Foreign Currency Monetary Item Translation Difference Account being the amount remaining to be amortised as at 31 March 2012.

12 The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous years figures have been regrouped / reclassified wherever necessary to correspond with the current years classification / disclosure.

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Mar 31, 2011

1 Contingent Liabilities in respect of : (Rs. Crore)

Sr. No. Particulars Current Year Previous Year

A Customs duty on shortfall in export obligation in accordance with EXIM Amount Amount Policy Unascertained Unascertained (The company is hopeful of meeting the export obligation within the stipulated period)

B Pending Litigation 0.05 0.05

C Guarantees given by banks on behalf of the Company 24.69 43.96

D Corporate Guarantees given to bank for loans taken by Subsidiary 213.35 212.79 Companies

E Bills discounted 242.94 71.47

F Taxation Matters :

a) During the year, the Company received Income Tax demand mainly 5.91 - on account of alleged short deposition of TDS amounts for four years arising from wrong TAN numbers mentioned while uploading the TDS return and certain payments not considered by the Tax authorities, although duly paid by the company. The Company has filed an appeal with the Commissioner of Income Tax (A) and also made application for rectification u/s 154 providing details of amounts paid to the bank and is hopeful of a favourable order.

b) Demands of Works Contract Tax not acknowledged as debts and not 0.59 - provided for. The company has initiated proceedings against such demand and is hopeful of favourable decision.

G Guarantee provided to New City of Bombay Mfg. Mills Limited (Joint 18.00 - Venture company) for loan given to Grabal Alok Impex Limited and another company

2 Related Party Disclosure

A. Name and transaction / balances with related party.

1. Name of related parties and nature of relationship

As per Accounting Standard 18 (AS-18) "Related Party Disclosures", Company's related parties disclosed as below:

I Associate Companies

Grabal Alok (UK) Ltd. (Formerly known as Hamsard 2353 Limited)

Alspun Infrastructure Ltd.

Ashford Infotech Private Limited

Nirvan Builders Private Limited

Next Creation Holdings LLC

II Entities under common control

Alok Denims (India) Private Limited

Alok Finance Private Limited

Alok Knit Exports Limited

Alok Textile Traders

Ashok B. Jiwrajka (HUF)

Ashok Realtors Private Limited

Buds Clothing Co.

D. Surendra & Co.

Dilip B. Jiwrajka (HUF)

Grabal Alok Impex Limited

Grabal Alok International Limited

Gogri Properties Private Limited

Green Park Enterprises

Jiwrajka Associates Private Limited

Jiwrajka Investment Private Limited

Niraj Realtors & Shares Private Limited

Nirvan Exports

Nirvan Holdings Private Limited

Pramatex Enterprises

Pramita Creation Private Limited

Surendra B. Jiwrajka (HUF)

Trumphant Victory Holdings Limited.

III Subsidiaries

Alok Inc.

Alok Industries International Ltd.

Alok Retail (India) Limited (Formerly known as Alok Homes &

Apparel Private Limited)

Alok Land Holdings Private Limited

Alok Aurangabad Infratex Private Limited

Alok H&A Limited

Alok International, Inc.

Alok European Retail, s.r.o. Mileta, a.s.

Alok Infrastructure Limited

Alok Apparels Private Limited

Alok New City Infratex Private Limited

Alok Realtors Private Limited

Alok HB Hotels Private Limited

Alok HB Properties Private Limited

Springdale Information and Technologies

Private Limited

Kesham Developers & Infotech Private Limited

IV Joint Venture

Aurangabad Textiles & Apparel Parks Limited

New City Of Bombay Mfg. Mills Limited

V Key Management Personnel

Ashok B. Jiwrajka

Chandrakumar Bubna

Directors

Dilip B. Jiwrajka

Surendra B. Jiwrajka

VI Relatives of Key Management Personnel

Alok A. Jiwrajka

Suryaprakash Bubna

c. Joint Venture

In compliance with the Accounting Standard 27 on 'Financial Reporting of interest in Joint Ventures' as notified by the (Companies Accounting Standards) Rules, 2006, the Company has interests in the following jointly controlled entities, which are incorporated in India.

3 Employee Stock Option Scheme (ESOS)

During the year, the shareholders of the Company approved the Employee Stock Option Scheme vide postal ballot, in accordance with the Securities and Exchange Board of India (ESOP & ESPS) Guidelines, 1999. Such scheme provides for grant of options to the eligible employees and /or directors of the Company and / or its subsidiaries. The Company is yet to grant any options under the scheme at the balance sheet date.

4 Employee benefit plans:

i) Defined contribution plans:

Amounts recognized as expenses towards contributions to provident fund, superannuation and other similar funds by the Company are Rs. 8.08 Crore (Previous Year Rs. 6.31 crore) for the year ended 31 March 2011.

ii) Defined benefit plans:

a) Gratuity Plan: The Company makes annual contribution to the Employee's Group Gratuity Assurance Scheme, administered by the Life Insurance Corporation of India ('LIC'), a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

b) Compensated absences: Employees' entitlement to compensated absences in future periods based on unavailed leave as at balance sheet date, as per the policy of the Company, is expected to be a long term benefit and is actuarially valued.

The following table sets out the status of the gratuity plan for the year ended 31 March 2011 as required under AS 15 (Revised)

5 Segment Reporting

a) Primary Segment: Geographical Segment

The company, considering its high level of international operations and present internal financial reporting based on geographical location of customer, has identified geographical segment as primary segment.

The geographic segment consists of:

a) Domestic (Sales to Customers located in India)

b) International (Sales to Customers located outside India)

Revenue directly attributable to segments is reported based on items that are individually identifiable to that segment. The company believes that it is not practical to allocate segment expenses, segment results, fixed assets used in the company's business or liabilities contracted since the resources/services/assets are used interchangeably within the segments. Accordingly, no disclosure relating to same is made

b) Secondary Segment: Business Segment

The company is operating in a single business i.e. Textile and as such all business activities revolve around this segment. Hence, there is no separate secondary segment to be reported considering the requirement of AS 17 on "Segment Reporting"

6 Provision for Income Tax of Rs. 120.57 crore (previous year Rs. 63.56 crore) has been computed on the basis of Minimum Alternate Tax (MAT) in accordance with Section 115JB of the Income Tax Act, 1961, in view of deductions available to the company. Considering the future profitability and taxable positions in the subsequent years, the company has recognized 'MAT credit entitlement' amounting to Rs. 42.25 crore (Previous year Rs. 34.26 crore), aggregating to Rs.110.39 crore (previous year Rs. 68.14 crore), as an asset by crediting the Profit and Loss Account for an equivalent amount and disclosed under 'Loans and Advances' (Schedule 11) in accordance with the Guidance Note on "Accounting for credit available in respect of Minimum Alternate Tax under the Income Tax Act, 1961" issued by The Institute of Chartered Accountants of India.

7 Grabal Alok (UK) Ltd, an associate Company, ("Grabal Alok UK") has entered into a JPY/USD foreign currency derivative entailing monthly settlement up to October 2012 with a 'knock-out' feature at a stipulated JPY/USD mark. Vide a Novation agreement, the Company has taken over the obligation to meet the liability which may arise from this derivative. Based on an assessment considering a forecast model, Grabal Alok UK has quantified the probable outgo at GBP 2.151 million in it's audited accounts. The Company has accordingly made a provision for an amount of Rs. 15.47 crore (GBP 2.151 mio) against it's obligation.

8 The Company had invested Rs. 79.15 crore in 1% cumulative redeemable preference shares of Alok Industries International Ltd ("Alok BVI"), its wholly owned subsidiary in an earlier year, which were redeemed during the year. Alok BVI has investments in step down subsidiaries, an associate company and others ("investee companies"). As of the year end an amount of Rs. 62.28 crore is due to the Company from Alok BVI. Based on an objective assessment of expected cash flow from investee companies, Alok BVI considers the provision for diminution made in the books as adequate. Accordingly, the Company has considered such advance as good of recovery.

9 During the previous year, the Company invested in a newly formed company, Triumphant Victory Holding Limited ("TVHL") in the British Virgin Islands, as a strategic long term investment. TVHL has availed of a short term loan facility from Axis Bank-DIFC-Dubai Branch for investment in Alok Industries International Limited by way of Compulsory Convertible Debentures with put option on the Company at the end of due date. The said put option was backed by a lien on fixed deposit of Nil (Previous Year Rs. 444.00 crore) of the Company held by Axis Bank, New Delhi.

10 a) The Company, during the year based on the Announcement of The Institute of Chartered Accountants of India "Accounting for Derivatives" along with the principles of prudence as enunciated in Accounting Standard 1 (AS-1) "Disclosure of Accounting Polices" has accounted for derivative forward contracts at fair values.

On that basis, changes in the fair value / (loss) of the derivative instruments as at 31 March 2011 aggregating to Rs. 72.96 Crore (previous year Rs. 23.95 Crore) has been accounted for by the Company. The charge on account of derivative losses has been computed on the basis of MTM values based on the report of counter parties. Net gain is fair values have been ignored.

b) Derivative contracts entered into by the company and outstanding as on 31 March 2011 for hedging currency and interest rate related risks

11 During the year Deutsche Bank, Singapore Branch has subscribed to unsecured floating rate compulsory convertible bonds issued by Alok Industries International Limited (ALOK BVI), a company incorporated in British Virgin Islands (a wholly owned subsidiary) and Grabal Alok (UK) Ltd (GAUK) a company incorporated in the united kingdom (associate) of the company, of USD 56.5 million each, with a green shoe option of USD 25 million. These bonds are secured by subservient charge on current and movable assets of the company which was created by executing a Deed of Hypothecation on 28 October 2010 in favour of AXIS Trustee Services Limited, Mumbai, India.

12 In line with the notification dated 31 March 2009 issued by the Ministry of Corporate Affairs, amending Accounting Standard (AS) 11 – 'E ffect of changes in Foreign Exchange Rates', the Company has chosen to exercise the option under paragraph 46 inserted in the Standard by the notification.

i) Added to fixed assets/ capital work-in-progress Rs. 23.48 crore (Previous year Rs. 75.00 crore) being exchange difference on long term monetary items relatable to acquisition of fixed assets.

ii) Carried forward Rs. (0.22) crore (previous year Rs. 0.17 crore) in the 'Foreign Currency Monetary Item Translation Difference Account' being the amount remaining to be amortised as at 31 March 2011.

13 The amounts in balance Sheet, Profit and Loss account and cash flow statement are rounded off to the nearest lakh and denominated in crore of rupees. The figures of the previous year have been reclassified / regrouped wherever necessary to correspond with those of the current year.

---

Mar 31, 2010

1 Contingent Liabilities in respect of :

(Rs. Crore)

Sr. No. Particulars Current Year Previous Year

A Customs duty on shortfall in export obligation in accordance with EXIM Amount Amount Policy Unascertained Unascertained

(The company is hopeful of meeting the export obligation within the stipulated period)

B Pending Litigation 0.09 0.04

C Guarantees given by banks on behalf of the Company 43.96 47.94

D Corporate Guarantees given to bank for loans taken by Subsidiary 212.79 214.25

Companies

E Bills discounted 71.74 86.45

2 Related Party Disclosure

1. Name of related parties and nature of relationship

As per Accounting Standard 18 (AS-18) "Related Party Disclosures", Companys related parties disclosed as below:

I Associates

Alok Denims (India) Private Limited

Alok Finance Private Limited

Alok Knit Exports Limited

Alok Textile Traders

Ashok B. Jiwrajka (HUF)

Ashok Realtors Private Limited

Buds Clothing Co.

D. Surendra & Co.

Dilip B. Jiwrajka (HUF)

Grabal Alok Impex Limited

Grabal Alok International Limited

Grabal Alok (UK) Ltd. (Formerly known as Hamsard 2353 Ltd.)

Gogri Properties Private Limited

Green Park Enterprises

Jiwrajka Associates Private Limited

Jiwrajka Investment Private Limited

Niraj Realtors & Shares Private Limited

Nirvan Exports

Nirvan Holdings Private Limited

Pramatex Enterprises

Pramita Creation Private Limited

Surendra B. Jiwrajka (HUF)

Alspun Infrastructure Ltd.

Ashford Infotech Private Limited

Nirvan Builders Private Limited

Triumphant Victory Holdings Limited.



II Subsidiaries

Alok Inc.

Alok Industries International Ltd.

Alok Retail (India) Limited (Formerly known as Alok Homes & Apparel Private Limited)

Alok Land Holdings Private Limited

Alok Aurangabad Infratex Private Limited

Alok H&A Limited

Alok International, Inc.

Alok European Retail, s.r.o. Mileta, a.s.

Alok Infrastructure Limited

Alok Apparels Private Limited

Alok New City Infratex Private Limited

Alok Realtors Private Limited

Alok HB Hotels Private Limited

Alok HB Properties Private Limited

Springdale Information and Technologies Private Limited

Kesham Developers & Infotech Private Limited



III Joint Venture

Aurangabad Textiles & Apparel Parks Limited

New City Of Bombay Mfg. Mills Limited



IV Key Management Personnel Ashok B. Jiwrajka

Chandrakumar Bubna Dilip B. Jiwrajka Directors

Surendra B. Jiwrajka

V Relatives of Key Management Alok A. Jiwrajka

Personnel

3 Qualified Institutional Placements

1. During the year, the Company has issued & allotted 182,100,248 equity shares of Rs. 10 each at a premium of Rs. 13.32 per equity share to Qualified Institutional Buyers in terms of Chapter VIII of Security and Exchange Board of India (Issue of Capital And Disclosure Requirements) Regulation 2009.

2. The Company intends to use the proceeds of issue, after deducting the Issue expenses, for Long term working capital margin and Capex requirements.

4 During the year, the warrant holder aggregating to Rs. 10.20 Crore representing 1,00,00,000 warrants of the face value of Rs. 10 each, had decided not to exercise the option of conversion and the company has forfeited such warrants & transferred the amount to Capital Reserve.

5 475 FCCBs (previous year 475 FCCBs) are carried forward from earlier year and pending conversion/ redemption as at the yearend aggregating Rs.107.21 crore (Previous Year Rs. 121.01 Crore) are disclosed under "Unsecured Loans" (Schedule 4). The total proceeds on this account have been fully utilised during the earlier years. The Company has on 26 May 2010 redeemed these 475 FCCBs

6 Employee benefit plans:

i) Defined contribution plans:

Amounts recognized as expenses towards contributions to provident fund, superannuation and other similar funds by the Company are Rs.11.92 Crore (Previous Year Rs. 9.54 crore) for the year ended 31 March 2010.

ii) Defined benefit plans:

a) Gratuity Plan: The Company makes annual contribution to the Employees Group Gratuity Assurance Scheme, administered by the Life Insurance Corporation of India (LIC), a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs on completion of five years of service.

b) Compensated absences: Employees entitlement to compensated absences in future periods based on unavailed leave as at balance sheet date, as per the policy of the Company, is expected to be a long term benefit and is actuarially valued.

7 Segment Reporting

a) Primary Segment: Geographical Segment

The company, considering its high level of international operations and present internal financial reporting based on geographical location of customer, has identified geographical segment as primary segment.

The geographic segment consists of:

a) Domestic (Sales to Customers located in India)

b) International (Sales to Customers located outside India)

8 In the opinion of the Board, carrying value of all Current assets, loans and advances and other receivables is not less than their realizable value in the ordinary course of business.

9 Provision for Income Tax of Rs. 63.56 crore (previous year Rs. 32.98 crore) has been computed on the basis of Minimum Alternate Tax (MAT) in accordance with Section 115JB of the Income Tax Act, 1961, in view of deductions available to the company. Considering the future profitability and taxable positions in the subsequent years, the company has recognized MAT credit entitlement amounting to Rs. 34.26 crore (Previous year Rs. 28.65 crore), aggregating to Rs. 68.14 crore (previous year Rs. 33.88 crore), as an asset by crediting the Profit and Loss Account for an equivalent amount and disclosed under Loans and Advances (Schedule 11) in accordance with the Guidance Note on "Accounting for credit available in respect of Minimum Alternate Tax under the Income Tax Act, 1961" issued by The Institute of Chartered Accountants of India.

10 Excess provision for dividend of earlier year of Rs. Nil (Previous Year Rs. 0.17 cores) [including dividend tax Rs. Nil (Previous year Rs. 0.02 crore)] represent the difference between the amount provided and paid considering the legal opinion obtained by the company and the amount finally paid on the shares allotted as on outcome of conversion of FCCBs

11 The company has invested in a subsidiary company viz; Alok Industries International Limited aggregating to Rs 79.37 Crore (Previous year Rs. 368.12 Crore) (including share application money) as at year end, which is a strategic long-term investment.

a) The subsidiary company has made investment in Alok European Retail, s.r.o. (AER), a 100% subsidiary, of Rs. 0.06 crore and granted an advance aggregating Rs. 0.74 crore. As per the audited financial statements as at 31 March 2010, the AER has incurred losses. The subsidiary company, for the time being, does not intend to continue with the business plans of investing further in this subsidiary and out of abundant caution, has made provision towards diminution in the value of investment of Rs. 0.06 crore and for doubtful advances Rs. 0.74 crore which would be adjusted, if any, based on future operational results of the subsidiary company. Accordingly, the investment in and advances to such subsidiary stand fully provided for.

b) The subsidiary company has made investment in its subsidiary viz; Mileta, a.s. aggregating Rs. 44.76 crore [Previous year Rs. 39.80 crore] and given interest free loan aggregating Rs. 25.00 crore [Previous year Rs. 58.24 crore] which is outstanding as at the yearend. Mileta has embarked upon a business growth plan for streamlining its opeartion and is expected to generate cash surplus from 2010-11. On that basis and the obective assessment of expected cash flow, investment in Mileta and the loan amount as at the year end is considered good and recoverable.

c) The subsidiary company has investment in an associate viz; Grabal Alok (UK) Limited aggregating to Rs. 314.22 crore (Previous year Rs. 354.66 crore) and given interest free loan of Rs. 7.40 crore (Previous year Rs. Nil) and interest bearing loan of Rs. 16.72 crore (Previous year Rs. Nil) which is a strategic long-term investment. The subsidiary company has also invested Rs. 54.04 crore [Previous year Rs. 38.06 crore] in another associate viz; Grabal Alok International Limited and given interest free loan of Rs. Nil [Previous year Rs. 16.73 crore], which has entirely invested such amounts in Grabal Alok (UK) Limited. Grabal Alok (UK) Ltd. has embarked upon a plan for revamping its retailing operations in Europe through an optimized sourcing strategy and opening of additional stores. On that basis and the obective assessment of expected cash flow, in the opinion of the Company, the aforesaid investments and the loan amounts outstanding as at 31 March 2010 are considered good and recoverable.

d) Rs. 33.43 crore (Previous Year Rs. 37.71 crore), being subscription money paid to PowerCor LLC towards 5% Group B Membership interest, which was made with a view to participate in the probable gains from commercializing of certain niche technology – plans, the said company is yet to commence its operations and has exclusive rights to market, commercialise and sell specific software used in development and implementation of certain products. It is Pre-mature to Re-assess the Potential of this venture, pending full clarity on the starts of their business plans, the subsidiary has made provision for Diminution in value of its investment to the extent of 25%.

e) Rs.5.91 crore (Previous Year Rs.6.67 crore) in 22 (Privious year 22) senior units of the equity capital of Aisle 5 LLC (Aisle), which is in the business of development, marketing and licensing of trade brands. Subsequent to the year end, an involuntary petition for liquidation under chapter 7 was filed against Aisle 5 LLC in the US Bankruptcy Court. Based on such liquidation petition, the Subsidiary Company has considered and made provision for diminution.

On the above basis and objective assessment of the expected cash flow of the subsidiary Company, in opinion of the company the investment in subsidiary company viz Alok Industries International Limited in considered good.

12. During the year, the Company invested in a newly formed company, Triumphant Victory Holding Limited ("TVHL") in the British Virgin Islands, as a strategic long term investment. TVHL has availed of a short term loan facility from Axis Bank-DIFC-Dubai Branch for investment in Alok Industries International Limited by way of Compulsory Convertible Debentures with put option on the Company at the end of due date. The said put option is backed by a lien on fixed deposit of Rs. 444.00 crore of the Company held by Axis Bank, New Delhi.

13. a) The Company, during the year based on the Announcement of The Institute of Chartered Accountants of India "Accounting for Derivatives" along with the principles of prudence as enunciated in Accounting Standard 1 (AS-1) "Disclosure of Accounting Polices" has accounted for derivative forward contracts at fair values.

On that basis, changes in the fair value of the derivative instruments as at 31 March 2010 aggregating to Rs. 23.95 Crore (previous year Rs. 16.85 Crore) have been debited to the Profit and Loss Account. The charge on account of derivative losses has been computed on the basis of MTM values based on the report of counter parties.

b) Derivative contracts entered into by the company and outstanding as on 31 March 2010 For hedging currency and interest rate related risks

c) All derivative and financial instruments acquired by the company are fir heding purpose only.

d) The yearend foreing currency exposure that has not been hedged by derivative instruments or otherwise are as below:

14. During the year the company has received Rs. 42.75 crore towards full & final settlement of insurance claim for material damage of Rs. 190.66 crore filed with the Insurer for fire occurred to its Texturising unit in previous years, and has recognised loss of Rs. 37.91 crore in the Profit & Loss Account.

15. In line with the notification dated 31 March 2009 issued by the Ministry of Corporate Affairs, amending Accounting Standard (AS) 11 – Effect of changes in Foreign Exchange Rates, the Company has chosen to exercise the option under paragraph 46 inserted in the Standard by the notification.

i) In effect of the above the company hasAdded to fixed assets/ capital work-in-progress Rs.75.00 crore (Previous year Rs. 166.46 crore) being exchange difference on long term monetary items relatable to acquisition of fixed assets.

ii) Charged to Profit & Loss Account Rs. 0.17 crore (Previous year Rs. 6.55 crore).

iii) Carried forward Rs. 0.17 crore (previous year Rs. 11.20 crore) in the Foreign Currency Monetary Item Translation Difference Account being the amount remaining to be amortised as at 31 March 2010.

16 The amounts in balance Sheet, Profit and Loss account and cash flow statement are rounded off to the nearest lakh and denominated in crore of rupees.

17. The figures of the previous year have been reclassified regrouped wherever necessary to correspond with those of the current year.