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A Oneindia Venture

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Notes to Accounts of Avenue Supermarts Ltd.

Mar 31, 2025

The Company through Qualified Institutional Placement (QIP) allotted 20,000,000 equity shares to the eligible Qualified Institutional Buyers (QIB) at an issue price of ''2,049 per equity share (including a premium of ''2,039 per equity share) aggregating to ''4,098 crore on 11^th February, 2020. The issue was made in accordance with the SEBl (Issue of Capital and Disclosure Requirements) Regulations, 2018 as amended (the âSEBI ICDR Regulationsâ), and Sections 42 and 62 of the Companies Act, 2013, as amended, including the rules made thereunder (the âIssueâ). Funds received pursuant to QIP are fully utilised towards the object stated in the placement document by 31^st March, 2024.

Expenses incurred by the Company aggregating to ''21.49 crore, in connection with QIP have been adjusted towards securities premium in March 2020.

b) Terms and rights attached to equity shares

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

c) Shares reserved for issue under option

Information relating to Avenue Supermarts limited Employee Stock Option Scheme, 2016, and Employee Stock Option Scheme, 2023 including details of option granted, exercised and lapsed during the financial year and options outstanding at the end of the reporting period, is set out in note 43.

Terms and conditions of transactions with related parties:

Sales and Purchase:

The sales and purchases with related parties are made in the ordinary course of business of the Company and have been done at arm''s length basis between the Company and related parties.

For the year ended 31^st March 2025, the Company has not recorded any impairment of receivables or write back of payables relating to amounts outstanding of related parties.

Corporate Guarantee to subsidiary:

Corporate Guarantee given to the bank for providing security for the performance of the obligations and liabilities of the subsidiary.

All Related Party Transactions entered during the year other than mentioned above are also in ordinary course of the business and on arm''s length basis. Outstanding balances at the year-end are unsecured and settlement occurs in cash.

36 CONTINGENT LIABILITIES AND COMMITMENTS (a) Contingent liabilities Claims against the Company not acknowledged as debts	As at 31^st March, 2025	('' in crore) As at 31^st March, 2024
Income tax matters	1.71	4.84
Indirect tax matters	267.03	121.76
Corporate Guarantee (Refer note 32)	13.01	21.41
Other matters	1.22	0.34

It is not practicable for the Company to estimate the timings of cash outflows , if any in respect of above pending resolutions of the respective proceedings.

The Company has reviewed all its pending litigation and proceedings and has adequately provided for where provisions are required and disclosed in contingent liabilities where applicable in it''s financial statements. The Company does not expect the outcome of these proceedings to have a materially adverse effect on it''s financial statements.

The Company has process whereby periodically all long-term contracts are assessed for material foreseeable losses. At the year end, Company has reviewed and ensured that adequate provision as required under any law/accounting standard for material foreseeable losses on such long-term contracts has been made in the books of accounts.

38 SEGMENT REPORTING

The Company is into the business of retail in India which in the context of Indian Accounting Standards 108 - âSegment Informationâ represents single reportable business segment. Information reported to The Chief Operating Decision Maker, for the purposes of resource allocation and assessment of segment performance focuses on the types of products sold / business conducted. The revenues, total expenses and net profit as per the statement of the profit and loss represents the revenue, total expenses and the net profit of the sole reportable segment. No single customer represents 10% or more of the Company''s total revenue for the year ended 31^st March, 2025 and 31^st March, 2024.

39 The Company has not entered into any derivative transaction during the year. Unhedged foreign currency exposure at the end of the year is NIL.

40 EARNINGS PER SHARE (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders by the weighted average number of Equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on conversion of all the dilutive potential equity shares into equity shares.

41 (a) Capital risk management

For the purpose of the Company''s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders. The primary objective is to maximise the shareholders value.

The Company manages its capital structure and makes adjustments in light of changes in economic condition and the requirements of the financial covenants. The Company has raised capital by issue of equity shares through an Initial Public Offer (IPO) in the year ended 31^st March, 2017 and Qualified Institutional Placement (QIP) in the year ended 31^st March, 2020. Certain proceeds from the IPO and QIP have been used for repayment of borrowings which have significantly reduced the Company''s borrowings and is NIL in the current year.

The capital structure is governed by policies approved by the Board of Directors and is monitored by various matrices, also funding requirements are reviewed periodically.

(b) Dividends

The Company has not paid any dividend since its incorporation.

42 FAIR VALUES AND FAIR VALUE HIERARCHY

The carrying amounts of trade receivables, cash and cash equivalents, bank balance other than cash and cash equivalents, other financial assets, trade payables, capital creditors are considered to be same as their fair values, due to their short-term nature.

The carrying value of lease liabilities, deposits given and taken and other financial assets and liabilities are considered to be reasonably same as their fair values. These are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counter party credit risk.

43 SHARE-BASED PAYMENTS

(a) Employee stock option scheme, 2023

During the year ended 31^st March, 2024, the Company had instituted an Avenue Supermarts Limited Employee Stock Option Scheme, 2023 (âthe Schemeâ) as approved by the Board of Directors dated 15^th July, 2023 for issuance of stock option to eligible employee of the Company and of its subsidiaries.

Pursuant to Avenue Supermarts Limited Employee Stock Option Scheme, 2023 Stock options convertible into 13,62,250 equity shares of ''10/- each were granted to eligible employees at exercise price of ''3,350 - ''3,420. Out of the options granted, 88,000 (31^st March, 2024: 35,000) options lapsed as at 31^st March, 2025.

(b) Employee stock option scheme, 2016

During the year ended 31^st March, 2017, the Company had instituted an Avenue Supermarts Limited Employee Stock Option Scheme, 2016 (âthe Schemeâ) as approved by the Board of Directors dated 23^rd July, 2016 for issuance of stock option to eligible employee of the Company and of its subsidiaries.

Pursuant to Avenue Supermarts Limited Employee Stock Option Scheme, 2016 Stock options convertible into 1,39,73,325 equity shares of ''10/- each were granted to eligible employees at exercise price of ''299/-. Out of the options granted, 55,57,008 options lapsed (31^st March, 2024: 55,39,683 ) and 66,50,367 options were vested (31^st March, 2024: 66,50,367) as at 31^st March, 2025. Against the vested options, 66,48,582 (31^st March, 2024: 66,48,582) equity shares of ''10/- each were allotted pursuant to exercise of options, and balance 1,785 (31^st March, 2024: 1,785) options lapsed as at 31^st March, 2025.

44 POST RETIREMENT BENEFIT PLAN

As per Indian Accounting Standard 19 âEmployee benefitsâ, the disclosures as defined are given below:

Defined Benefit Plan

The Company operates a gratuity plan wherein every employees entitled to the benefit equivalent to fifteen days salary last drawn for each year of service. The same is payable on termination of service or retirement whichever is earlier. The benefit vest after five years of continuous service. The gratuity paid is governed by The Payment of Gratuity Act,1972. The Company contributes to the fund based on actuarial report details of which is available in the table of investment pattern of plan asset, based on which the Company is not exposed to market risk. The following table summarises the component of net benefit expenses recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for respective period.

The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering several applicable factors, mainly the composition of plan assets held, assessed risks, historical results of return on plan assets and the Company''s policy for plan assets management.

There has been no change from the previous year in the method and assumptions used in preparing the sensitivity analysis.

These plans typically exposed the Company to actuarial risks such as Interest risk, salary risk, investment risk, asset liability matching risk and mortality risk.

Gratuity is a defined benefit plan and Company is exposed to the following risks:

Interest rate risk: A fall in the discount rate which is linked to the G.Sec. rate will increase the present value of the liability requiring higher provision. A fall in the discount rate generally increases the mark to market value of the assets depending on the duration of asset.

Salary risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more than assumed level will increase the plan''s liability.

Investment risk: The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. If the return on plan asset is below this rate, it will create a plan deficit. Currently, for the plan in India, it has a relatively balanced mix of investments in government securities, and other debt instruments.

Asset liability matching risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration risk: Plan is having a concentration risk as all the assets are invested with the insurance company and a default will wipe out all the assets. Although probability of this is very low as insurance companies have to follow stringent regulatory guidelines which mitigate risk.

45 FINANCIAL RISK MANAGEMENT

Financial risk management objectives and policies

The Company''s financial principal liabilities comprises lease liabilities, trade payables and other payables. The main purpose of these financial liabilities to finance the Company operation. The Company''s main financial assets includes trade and other receivable, cash and cash equivalent, other bank balances derived from its operations.

In addition to risks inherent to our operations, we are exposed to certain market risks including change in interest rates and fluctuation in currency exchange rates.

A) Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivable) and from its financial activities including deposits with banks and financial institution.

Credit risk from balances with banks is managed by the Company''s treasury department in accordance with Company''s policy.

The Company operates on business model of primarily cash and carry along with sales to subsidiaries and credit risk from receivable perspective is not significant.

B) Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time, or at a reasonable price. Processes and policies related to such risk are overseen by senior management. Management monitors the Company''s net liquidity position through rolling forecasts on the basis of expected cash flows.

(iii) The Company does not have any charges or satisfaction which is yet to be registered with Registrars of Companies beyond the statutory period.

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

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

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiariesâ

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

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

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

(vii) The Company does not have any such transaction which is not recorded in the books of account 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).

(viii) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets during the year ended 31^st March, 2025.

(ix) The Company has not provided loans, advances in the nature of loans, stood guarantee (other than corporate guarantee as disclosed in note 32), or provided security to Companies, Firms, limited liability partnerships.

(x) The Company has not defaulted in repayment of loans, or other borrowings or payment of interest thereon to any lender.

(xi) The Company has not been declared willful defaulter by any bank, financial institution, government or government authority.

(xii) The quarterly returns/statements filed by the Company with the banks are in agreement with the books of account of the Company.

50 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^st April, 2024. The Company has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.

(i) Ind AS 117 Insurance Contracts

The Ministry of corporate Affairs (MCA) notified the Ind AS 117, Insurance Contracts, vide notification dated 12^th August, 2024, under the Companies (Indian Accounting Standards) Amendment Rules, 2024, which is effective from annual reporting periods beginning on or after 1^st April, 2024.

Ind AS 117 Insurance Contracts is a comprehensive new accounting standard for insurance contracts covering recognition and measurement, presentation and disclosure. Ind AS 117 replaces Ind AS 104 Insurance Contracts. Ind AS 117 applies to all types of insurance contracts, regardless of the type of entities that issue them as well as to certain guarantees and financial instruments with discretionary participation features; a few scope exceptions will apply. Ind AS 117 is based on a general model, supplemented by:

â¢ A specific adaptation for contracts with direct participation features (the variable fee approach)

â¢ A simplified approach (the premium allocation approach) mainly for short-duration contracts

The application of Ind AS 117 had no impact on the Company''s financial statements as the Company has not entered any contracts in the nature of insurance contracts covered under Ind AS 117.

(ii) Amendment to Ind AS 116 Leases - Lease Liability in a Sale and Leaseback

The MCA notified the Companies (Indian Accounting Standards) Second Amendment Rules, 2024, which amend Ind AS 116, Leases, with respect to Lease Liability in a Sale and Leaseback.

The amendment specifies the requirements that a seller-lessee uses in measuring the lease liability arising in a sale and leaseback transaction, to ensure the seller-lessee does not recognise any amount of the gain or loss that relates to the right-of-use it retains.

The amendment is effective for annual reporting periods beginning on or after 1^st April, 2024 and must be applied retrospectively to sale and leaseback transactions entered into after the date of initial application of Ind AS 116.

The amendment does not have a material impact on the Company''s financial statements.

51 STANDARDS NOTIFIED BUT NOT EFFECTIVE

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

52 EVENTS AFTER THE REPORTING PERIOD

The Company has evaluated subsequent events from the balance sheet date through 3^rd May, 2025, the date at which the standalone financial statements were available to be issued, and determined that there are no material items to disclose other than those disclosed above.

53 The Company has used accounting software for maintaining its books of account including privileged access management tool 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. Additionally, the audit trail has been preserved by the Company as per the statutory requirements for record retention.

54 The previous year numbers have been reclassified wherever necessary.

Mar 31, 2024

(v) Provisions, contingent liabilities and contingent assets

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources embodying economic benefit will be required to settle the obligation and the amount can be reliably estimated.

Provisions are measured at the present value of management''s best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as finance cost.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events but their existence will be confirmed by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the Company or where any present obligation cannot be measured in terms of future outflow of resources or where a reliable estimate of the obligation cannot be made.

A contingent asset is disclosed, where an inflow of economic benefits is probable. An entity shall not

recognize a contingent asset unless the recovery is virtually certain.

(l) Revenue Recognition

Revenue from operations is recognised to the extent that it is probable that economic benefit will flow to the Company and the revenue can be reliably measured regardless of when the payment is being made as per IND AS 115.

Revenue from contracts with customers is recognised when the control/title of the goods or services are transferred to the customer at an amount of transaction price allocated to that performance obligation that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services excluding government duties collected on behalf of the Government.^ determining the transaction price of goods sold and services rendered, the Company excludes the effect of any variable consideration on account of various discounts and schemes offered by the Company as a part of the Contract.

It is the Company''s policy to sell its products to the end customers with the right of return of 7 days. Historical experience is used to estimate and provide for such returns at the time of sale.

The Company has generally concluded that it is the principal in its revenue arrangements, except for the agency services below, because it typically controls the goods or services before transferring them to the customer.

Principal versus agent consideration

The inventory of third party does not pass to the Company till the product is sold. At the time of sale of such inventory, the sales value along with the cost of inventory is disclosed seprately as sale of goods on approval basis and cost of goods sold on approval basis and forms part of Revenue in the Statement of Profit and Loss. Only the net revenue earned i.e. margin is recorded as a part of revenue.

Rental income

Rental income arising from operating lease on investment properties is accounted for on a straight line basis over lease terms unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases and is included in the Statement of profit and loss due to its operating nature.

Interest income

Interest income is recongnised based on time proportion basis considering the amount outstanding and rate applicable (EIR). Interest income in included in the Other Income in the statement of Profit and Loss.

(m) Retirement and other employee benefits

(i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees'' services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled.

Retirement benefit in the form of provident fund is a defined contribution plan. The Company has no obligation , other than the contribution payable to the provident fund. The Company recognises contribution payable to the provident fund scheme as an expense, when an employee renders the related services. If the Contribution payable to the scheme for service received before the balance sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognised as a liability after deducting the contribution already paid. If the contribution already paid exceeds the contribution due for services received before the balance sheet date,then excess is recognised as an asset to the extent that the prepayment will lead to a reduction in future payment or a cash refund.

ii) Other long-term employee benefit obligations

The liabilities for earned leave and sick leave that are not expected to be settled wholly within 12 months are measured at the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. The benefits are discounted using the Government Securities (G-Sec) at the end of the reporting period that have terms approximating to the terms of the related obligation. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in the Statement of Profit and Loss.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

iii) Post-employment obligations Defined benefit plans Gratuity

The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan

assets. The defined benefit obligation is calculated annually by independent actuary using the projected unit credit method. The present value of the defined benefit obligation denominated in INR is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and Loss. Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in which they occur, directly in other comprehensive income. They are included in retained earnings in the statement of changes in equity and in the balance sheet. Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in the Statement of profit and loss as past service cost.

Share based payment

Equity settled share based payments to employees and other providing similar services are measured at fair value of the equity instruments at grant date.

The fair value determined at the grant date of the equity-settled share based payment is expensed on a straight line basis over the vesting period, based on the Company''s estimate of equity instruments that will eventually vest, with a corresponding increase in equity. At the end of each reporting period , the Company revises its estimates of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any is , recongised in Statement of Profit and Loss such that the cumulative expenses reflects the revised estimate,with a corresponding adjustment to the shared option outstanding account.

No expense is recognised for options that do not ultimately vest because non market performance and/or service conditions have not been met.

The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

Expense relating to options granted to employees of the subsidiaries under the Company''s share based payment plan, is recovered from the subsidiaries. Such recovery is reduced from employee benefit expense.

(n) Foreign currency transactions

(a) Functional and presentation currency:

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the entity operates. The standalone financial statements are presented in I NR, which is functional and presentational currency.

(b) Transaction and balances :

Transaction in currencies other than than entity''s functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transaction.

Exchange differences arising on settlement or translation of monetary items are recognised in the Statement of Profit and Loss.

Non monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item.

(o) Income tax

a) Current Tax

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that enacted or substantively enacted, at the reporting date in the countries where The Company operates and generates taxable income.

b) Deferred tax

Deferred income tax is provided using the liability method on temporary differences arising between the tax bases of assets and liabilities and their carrying amount for financial reporting purpose at the reporting date. Deferred tax assets and liabilities are determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the asset is realised or the liability is settled.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses, only if, it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are off set where The Company has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

Current and deferred tax is recognised in the Statement of Profit and Loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively

(p) Earnings Per Share

Basic earnings per share

Basic earnings per share is calculated by dividing:

- the profit attributable to equity shareholder of the Company

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

Diluted earnings per share

Diluted earnings per share adjusts the figures used in the 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) Fair value measurement

The Company measures financial instrument at fair value at each Balance sheet date.

Fair value is the price that would be received to sell assets or paid to transfer a liability in an orderly transaction between market participant at the measurement date.

The fair values 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:

1. Fair value of cash and deposits, trade and other receivables, trade payables and other current liabilities, approximate their carrying amounts largely due to short term maturities of these instruments.

2. The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

3. For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

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

Level 1 : quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

(r) Significant accounting judgement, estimates and assumption

The preparation of standalone financial statements requires the use of accounting estimates which by definition will seldom equal the actual results. Management also need to exercise judgement in applying the Company''s accounting policies.

Share based payment

The Company initially measures the cost of equity settled transaction with employees using Black Scholes model to determine the fair value of the liability incurred. Estimating fair value for share-based payment transaction requires determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant. The estimates also requires determination of the most appropriate inputs to the valuation model including expected life of the share option, volatility and dividend yield

and making assumptions about them.For equity settled share based payment transaction, the liability needs to be re-measured at the end of each reporting period upto the date of settlement, with any changes in fair value recognised in the Statement of Profit and Loss. This requires a re-assessment of the estimates used at end of each reporting period. The assumption and models used for estimating the fair value for share based-payment transaction are disclosed in note no. 43.

Provision for inventory

The Company has calculated the provision for inventory basis the percentage as per historical experience for inventory lying from the last inventory count date to the reporting date.

An inventory provision is also recognised for cases where the realisable value is estimated to be lower than the inventory carrying value. The inventory provision is estimated taking into account various factors, including prevailing sales prices of inventory item, the seasonality of the item''s sales profile and losses associated with obsolete / slow-moving inventory items.

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and other post-employment medical benefits and the present value of the gratuity obligation 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 parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation.

The mortality rate is based on publicly available mortality tables for the specific countries. 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.

Further details about gratuity obligations are given in note no. 44.

(s) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker being Managing Director of the Company . The Managing Director assesses the financial performance and position of the Company as a whole, and makes strategic decisions.

(t) Cash flow

The investing and financing activities in cash flow statement do not have a direct impact on current cash flows although they do affect the capital and asset structure of an entity. The Company has disclosed these transactions, to the extent material, in notes to cash flow statement.

38 SEGMENT REPORTING

The Company''s business activity falls within a single primary business segment of retail and one reportable geographical segment which is âwithin Indiaâ. Accordingly, the Company is a single segment company in accordance with Indian Accounting Standard 108 âOperating Segmentâ.

39 The Company has not entered into any derivative transaction during the year. Unhedged foreign currency exposure at the end of the year is NIL.

40 EARNINGS PER SHARE (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of equity shares outstanding during the year.

41 (a) Capital risk management

The capital structure is governed by policies approved by the Board of Directors and is monitored by various matrices, also funding requirements are reviewed periodically.

(b) Dividends

The Company has not paid any dividend since its incorporation.

42 FAIR VALUES AND FAIR VALUE HIERARCHY

43 SHARE-BASED PAYMENTS

(a) Employee stock option scheme, 2023

Pursuant to Avenue Supermarts Limited Employee Stock Option Scheme, 2023 Stock options convertible into 13,62,250 equity shares of '' 10/- each were granted to eligible employees at exercise price of '' 3,350 - '' 3,420. Out of the options granted, 35,000 options lapsed as at 31^st March, 2024.

(b) Employee stock option scheme, 2016

Pursuant to Avenue Supermarts Limited Employee Stock Option Scheme, 2016 Stock options convertible into 1,39,73,325 equity shares of '' 10/- each were granted to eligible employees at exercise price of '' 299/-. Out of the options granted, 55,39,683 options lapsed (31^st March, 2023: 53,28,483) and 66,50,367 options were vested (31^st March, 2023: 66,50,367) as at 31^st March, 2024. Against the vested options, 66,48,582 (31^st March, 2023 : 41,79,492) equity shares of '' 10/- each were allotted pursuant to exercise of options, and balance 1,785 (31^st March, 2023 : 900) options lapsed as at 31^st March, 2024.

There has been no change from the previous year in the method and assumptions used in perparing the sensitivity analysis.

These plans typically exposed the Company to actuarial risks such as Interest risk, salary risk, investment risk, asset liability matching risk and mortality risk.

Gratuity is a defined benefit plan and Company is exposed to the following risks:

Asset liability matching risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration risk: Plan is having a concentration risk as all the assets are invested with the insurance Companies.

45 FINANCIAL RISK MANAGEMENT

Financial risk management objectives and policies

In addition to risks inherent to our operations, we are exposed to certain market risks including change in interest rates and fluctuation in currency exchange rates.

A) Credit risk

Credit risk from balances with banks is managed by the Company''s treasury department in accordance with Company''s policy.

The Company operates on business model of primarily cash and carry along with sales to subsidiaries and credit risk from receivable perspective is not significant.

B) Liquidity risk

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

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

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

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

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

(vii) 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)

(viii) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets during the year ended 31^st March,2024.

(x) The Company has not defaulted in repayment of loans, or other borrowings or payment of interest thereon to any lender.

(xi) The Company has not been declared wilful defaulter by any bank, financial institution, government or government authority.

(xii) The quarterly returns/statements filed by the company with the banks are in agreement with the books of accounts

of the company.

50 NEW AND AMENDED STANDARDS

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

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

The amendments clarify the distinction between changes in accounting estimates and changes in accounting policies and the correction of errors. It has also been clarified how entities use measurement techniques and inputs to develop accounting estimates.

The amendments had no impact on the Company''s standalone financial statements.

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

The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their âsignificant'' accounting policies with a requirement to disclose their âmaterial'' accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures. The amendments have had an impact on the Company''s disclosures of accounting policies, but not on the measurement, recognition or presentation of any items in the Company''s standalone financial statements.

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

The amendments narrow the scope of the initial recognition exception under Ind AS 12, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences such as leases. The Company previously recognised for deferred tax on leases on a net basis. As a result of these amendments, the Company has recognised a separate deferred tax asset in relation to its lease liabilities and a deferred tax liability in relation to its right-of-use assets. Since, these balances qualify for offset as per the requirements of paragraph 74 of Ind AS 12,there is no impact in the balance sheet. There was also no impact on the opening retained earnings as at 1^st April, 2023.

51 STANDARDS NOTIFIED BUT NOT EFFECTIVE

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

52 EVENTS AFTER THE REPORTING PERIOD

The Company has evaluated subsequent events from the balance sheet date through 4^th May, 2024, the date at which the standalone financial statements were available to be issued, and determined that there are no material items to disclose other than those disclosed above.

54 The previous year numbers have been reclassified wherever necessary.

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

Avenue Supermarts Limited

For S R B C & CO LLP Ignatius Navil Noronha Ramakant Baheti

Chartered Accountants Managing Director and Whole-time Director and

ICAI firm registration number 324982E/E300003 Chief Executive Officer Group Chief Financial Officer

DIN : 01787989 DIN : 00246480

per Vikram Mehta

Partner Niladri Deb Ashu Gupta

Membership No. : 105938 Chief Financial Officer Company Secretary

Thane, 4^th May, 2024 Thane, 4^th May, 2024

Mar 31, 2023

The Company through Qualified Institutional Placement (QIP) allotted 20,000,000 equity shares to the eligible Qualified Institutional Buyers (QIB) at a issue price of ?2,049 per equity share (including a premium of ?2,039 per equity share) aggregating to ?4,098 crore on 11^th February, 2020. The issue was made in accordance with the SEBl (Issue of Capital and Disclosure Requirements) Regulations, 2018 as amended (the âSEBI ICDR Regulationsâ), and Sections 42 and 62 of the Companies Act, 2013, as amended, including the rules made thereunder (the âIssueâ). Funds received pursuant to QIP are being utilised towards the object stated in the placement document and the balance unutilised as on 31^st March,2023 remain invested in deposits with scheduled commercial banks.

Expenses incurred by the Company aggregating to C21.49 Crores, in connection with QIP have been adjusted towards securities premium in March 2020.

Terms and rights attached to equity shares

The Company has only one class of equity shares having par value of C10 per share. Each holder of equity shares is entitled to one vote per share. The Company if declares dividend would pay dividend in Indian rupees. The dividend if proposed by the Board of Directors would be subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Shares reserved for issue under option

I nformation relating to Avenue Supermarts limited Employee Stock Option Scheme, 2016, including details of option granted, exercised and lapsed during the financial year and options outstanding at the end of the reporting period, is set out in note 43.

It is not practicable for the Company to estimate the timings of cash outflows , if any in respect of above pending resolutions of the respective proceedings.

38 Segment reporting

38 The Company has not entered into any derivative transaction during the year. Unhedged foreign currency exposure at the end of the year is NIL.

40 Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of equity shares outstanding during the year.

41 (a) Capital risk management

The capital structure is governed by policies approved by the Board of Directors and is monitored by various matrices funding requirements are reviewed periodically.

(b) Dividends

The Company has not paid any dividend since its incorporation.

42 Fair values and fair value hierarchy

43 Share-based payments Employee stock option plan

Pursuant to Avenue Supermarts Limited Employee Stock Option Scheme, 2016 Stock options convertible into 1,39,73,325 equity shares of C10/- each were granted to eligible employees at exercise price of C299/-. Out of the options granted, 53,28,483 options

44 Post retirement benefit plan

As per Indian Accounting Standard 19 âEmployee benefitsâ, the disclosures as defined are given below :

Defined Benefit Plan

The Company operates a gratuity plan wherein every employees entitled to the benefit equivalent to fifteen days salary last drawn for each year of service. The same is payable on termination of sevice or retirement whichever is earlier. The benefit vest after five years of continuous service. The gratuity paid is governed by The Payment of Gratuity Act,1972. The Company contributes to the fund based on actuarial report details of which is available in the table of investment pattern of plan asset, based on which the Company is not exposed to market risk. The following table summarises the component of net benefit expenses recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for respective period.

There has been no change from the previous year in the method and assumptions used in perparing the sensitivity analysis.

These plans typically exposed the Company to actuarial risks such as Interest risk, salary risk, investment risk, asset liability matching risk and mortality risk.

Gratuity is a defined benefit plan and Company is exposed to the following risks:

Asset liability matching risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration risk: Plan is having a concentration risk as all the assets are invested with the insurance Companies.

45 Financial risk management

Financial risk management objectives and policies

I n addition to risks inherent to our operations, we are exposed to certain market risks including change in interest rates and fluctuation in currency exchange rates.

A) Credit risk

Credit risk from balances with banks is managed by the Company''s treasury department in accordance with Company''s policy.

The Company operates on business model of primarily cash and carry along with sales to subsidiaries and credit risk from receivable perspective is not significant.

B) Liquidity risk

49 Other Statutory Information

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

(ii) The Company does not have any transactions with companies struck off

(iii) The Company does not have any charges or satisfaction which is yet to be registered with Registrars of Companies beyond

the statutory period

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year

(v) The Company has not advanced or loaned or invested funds to any other person or entity, including foreign entities

(Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

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

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

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

(viii) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets during the year ended 31^st March, 2023.

(x) The Company has not defaulted in repayment of loans, or other borrowings or payment of interest thereon to any lender.

(xi) The Company has not been declared willful defaulter by any bank, financial institution, government or government authority.

(xii) The quarterly returns/statements filed by the Company with the banks are in agreement with the books of account of the Company.

50 New and amended standards

The Ministry of Corporate Affairs has notified Companies (Indian Accounting Standards) Amendment Rules,2022 dated March 23,2022 , to amend the following IND AS which are effective from April 01,2022.

i. Onerous Contracts - Costs of Fulfilling a Contract - Amendments to Ind AS 37

An onerous contract is a contract under which the unavoidable of meeting the obligations under the contract costs (i.e., the costs that the Company cannot avoid because it has the contract) exceed the economic benefits expected to be received under it.

The amendments specify that when assessing whether a contract is onerous or loss-making, an entity needs to include costs that relate directly to a contract to provide goods or services including both incremental costs (e.g., the costs of direct labour and materials) and an allocation of costs directly related to contract activities (e.g., depreciation of equipment used to fulfil the contract and costs of contract management and supervision). General and administrative costs do not relate directly to a contract and are excluded unless they are explicitly chargeable to the counterparty under the contract.

These amendments had no impact on the standalone financial statements of the Company.

ii. Reference to the Conceptual Framework - Amendments to Ind AS 103

The amendments replaced the reference to the ICAI''s âFramework for the Preparation and Presentation of Financial Statements under Indian Accounting Standardsâ with the reference to the âConceptual Framework for Financial Reporting under Indian Accounting Standardâ without significantly changing its requirements.

The amendments also added an exception to the recognition principle of Ind AS 103 Business Combinations to avoid the issue of potential âday 2'' gains or losses arising for liabilities and contingent liabilities that would be within the scope of Ind AS 37 Provisions, Contingent Liabilities and Contingent Assets or Appendix C, Levies, of Ind AS 37, if incurred separately. The exception requires entities to apply the criteria in Ind AS 37 or Appendix C, Levies, of Ind AS 37, respectively, instead of the Conceptual Framework, to determine whether a present obligation exists at the acquisition date.

The amendment also adds a new paragraph to IFRS 3 to clarify that contingent assets do not qualify for recognition on the acquisition date.

These amendments had no impact on the standalone financial statements of the Company.

iii. Property, Plant and Equipment: Proceeds before Intended Use - Amendments to Ind AS 16

The amendments modified paragraph 17(e) of Ind AS 16 to clarify that excess of net sale proceeds of items produced over the cost of testing, if any, shall not be recognised in the profit or loss but deducted from the directly attributable costs considered as part of cost of an item of property, plant, and equipment.

These amendments had no impact on the standalone financial statements of the Company as there were no sales of such items produced by property, plant and equipment made available for use on or after the beginning of the earliest period presented.

iv. Ind AS 101 First-time Adoption of Indian Accounting Standards - Subsidiary as a first-time adopter

The amendment permits a subsidiary that elects to apply the exemption in paragraph D16(a) of Ind AS 101 to measure cumulative translation differences for all foreign operations in its financial statements using the amounts reported by the parent, based on the parent''s date of transition to Ind AS, if no adjustments were made for consolidation procedures and for the effects of the business combination in which the parent acquired the subsidiary. This amendment is also available to an associate or joint venture that uses exemption in paragraph D16(a) of Ind AS 101.

The amendments are effective for annual reporting periods beginning on or after 1 April 2022 but do not apply to the Company as it is not a first-time adopter.

v. Ind AS 109 Financial Instruments - Fees in the â10 per centâ test for derecognition of financial liabilities

The amendment clarifies the fees that an entity includes when assessing whether the terms of a new or modified financial liability are substantially different from the terms of the original financial liability. These fees include only those paid or received between the borrower and the lender, including fees paid or received by either the borrower or lender on the other''s behalf.

In accordance with the transitional provisions, the Company applies the amendment to financial liabilities that are modified or exchanged on or after the beginning of the annual reporting period in which the entity first applies the amendment (the date of initial application).

These amendments had no impact on the standalone financial statements of the Company as there were no modifications of the Company''s standalone financial instruments during the year.

vi. Ind AS 41 Agriculture - Taxation in fair value measurements

The amendment removes the requirement in paragraph 22 of Ind AS 41 that entities exclude cash flows for taxation when measuring the fair value of assets within the scope of Ind AS 41.

The amendments had no impact on the standalone financial statements of the Company as it did not have assets in scope of IAS 41 as at the reporting date.

51 Standards notified but not effective

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 from 01 April 2023.

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

The amendments are effective for annual reporting periods beginning on or after 1 April 2023 and apply to changes in accounting policies and changes in accounting estimates that occur on or after the start of that period.

The amendments are not expected to have a material impact on the Company''s standalone financial statements.

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

The amendments to Ind AS 1 are applicable for annual periods beginning on or after 1 April 2023. Consequential amendments have been made in Ind AS 107.

The Company is currently revisiting their accounting policy information disclosures to ensure consistency with the amended requirements.

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

The amendments should be applied to transactions that occur on or after the beginning of the earliest comparative period presented. In addition, at the beginning of the earliest comparative period presented, a deferred tax asset (provided that sufficient taxable profit is available) and a deferred tax liability should also be recognised for all deductible and taxable temporary differences associated with leases and decommissioning obligations. Consequential amendments have been made in Ind AS 101. The amendments to Ind AS 12 are applicable for annual periods beginning on or after 1 April 2023.

The Company is currently assessing the impact of the amendments.

52 Events after the reporting period

The Company has evaluated subsequent events from the balance sheet date through 13^th May, 2023, the date at which the standalone financial statements were available to be issued, and determined that there are no material items to disclose other than those disclosed above.

53 The previous year numbers have been reclassified wherever necessary.

Mar 31, 2022

b) All the upcoming projects of the Company are within the timelines as estimated during the original plan and the actual cost of projects are within the total cost as estimated by the management of the Company as on 31^st March, 2022.

4 Assets pledged as security for borrowings is disclosed under note 32.

5 Building includes Net book value of plant and equipment fitting of ? 22.06 crores (31^st March, 2021 : ? 27.66 crores).

6 Freehold Land includes one property at Bhamti Nagar, Nagpur of ? 10.65 crores as at 31^st March, 2022 (31^st March, 2021: ? 10.65 crores) purchased by the company. The company has filed an Appeal before Deputy Director of Land Records (DDLR) at Nagpur thereby challenging the Order (by Virtue of which Ownership of the seller is affected) passed by Superintendent of Land Records. Title deed in respect of the said property is held in the name of the Avenue Supermarts Limited.

The Company has no restrictions on the realisability of its investment properties and no contractual obligations to purchase, construct or develop investment properties or for repairs, maintenance and enhancements.

Estimation of fair value

The fair valuation is based on current prices in the active market for similar properties. The main inputs used are quantum, area, location, demand, restrictive entry to the complex, age of building and trend of fair market rent.

This valuation is based on valuations performed by a registered valuer as defined under rule 2 of Companies (Registered Valuers and Valuation) Rules, 2017. Fair valuation is based on replacement cost method. The fair value measurement is categorised in level 2 fair value hierarchy.

The Company through Qualified Institutional Placement (QIP) allotted 20,000,000 equity shares to the eligible Qualified Institutional Buyers (QIB) at a issue price of '' 2,049 per equity share (including a premium of '' 2,039 per equity share) aggregating to '' 4,098 crore on 11^th February, 2020. The issue was made in accordance with the SEBl (Issue of Capital and Disclosure Requirements) Regulations, 2018 as amended (the âSEBI ICDR Regulationsâ), and Sections 42 and 62 of the Companies Act, 2013, as amended, including the rules made thereunder (the âIssueâ). Funds received pursuant to QIP are being utilised towards the object stated in the placement document and the balance unutilised as on 31^st March,2022 remain invested in deposits with scheduled commercial banks.

Expenses incurred by the Company aggregating to '' 21.49 crores, in connection with QIP have been adjusted towards securities premium in March 2020.

b) Terms and rights attached to equity shares

The Company has only one class of equity shares having par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. The Company if declares dividend would pay dividend in Indian rupees. The dividend if proposed by the Board of Directors would be subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

c) Shares reserved for issue under option

It is not practicable for the Company to estimate the timings of cash outflows, if any in respect of above pending resolutions of the respective proceedings.

The Company has process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, Company has reviewed and ensured that adequate provision as required under any law/accounting standard for material foreseeable losses on such long term contracts has been made in the books of accounts.

37 Segment reporting

38 The Company has not entered into any derivative transaction during the year. Unhedged foreign currency exposure at the end of the year is NIL.

39 Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of equity shares outstanding during the year.

40 (a) Capital risk management

The capital structure is governed by policies approved by the Board of Directors and is monitored by various matrices funding requirements are reviewed periodically.

(b) Dividends

The Company has not paid any dividend since its incorporation.

41 Fair values and fair value hierarchy

The carrying value of borrowings, lease liabilities, deposits given and taken and other financial assets and liabilities are considered to be reasonably same as their fair values. These are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counter party credit risk.

42 Share-based payments Employee stock option plan

Pursuant to Avenue Supermarts Limited Employee Stock Option Scheme, 2016 Stock options convertible into 13,973,325 equity shares of '' 10/- each were granted to eligible employees at exercise price of '' 299/-. Out of the options granted, 45,41,945 options lapsed (31^st March, 2021: 44,58,695) and 36,95,605 options were vested (31^st March, 2021 : 36,91,105) as at 31^st March, 2022. Against the vested options, 36,90,205 (31^st March, 2021 : 36,90,205) equity shares of '' 10/- each were allotted pursuant to exercise of options, and balance 900 (31^st March, 2021 : 900) options lapsed.

43 Post retirement benefit plan

As per Indian Accounting Standard 19 âEmployee benefitsâ, the disclosures as defined are given below:

Defined Benefit Plan

The Company operates a gratuity plan wherein every employees entitled to the benefit equivalent to fifteen days salary last drawn for each year of service. The same is payable on termination of sevice or retirement whichever is earlier. The benefit vest after five years of continuous service. The gratuity paid is governed by The Payment of Gratuity Act,1972. The Company contributes to the fund based on actuarial report details of which is available in the table of investment pattern of plan asset, based on which the Company is not exposed to market risk. The following table summarises the component of net benefit expenses recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for respective period.

5 All investment of plan asset are done in M/s Avenue Supermarts Limited Employees Group Gratuity Trust which is governed by Board of Trustees.

There has been no change from the previous year in the method and assumptions used in perparing the sensitivity analysis.

These plans typically exposed the Company to actuarial risks such as Interest risk, salary risk, investment risk, asset liability matching risk and mortality risk.

Gratuity is a defined benefit plan and Company is exposed to the following risks:

Asset liability matching risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration risk: Plan is having a concentration risk as all the assets are invested with the insurance Companies.

44 Financial risk management

Financial risk management objectives and policies

The Company''s financial principal liabilities comprises borrowings, lease liabilities, trade payables and other payables. The main purpose of these financial liabilities to finance the Company operation. The Company''s main financial assets includes trade and other receivable, cash and cash equivalent, other bank balances derived from its operations.

I n addition to risks inherent to our operations, we are exposed to certain market risks including change in interest rates and fluctuation in currency exchange rates.

A) Credit risk

Credit risk from balances with banks is managed by the Company''s treasury department in accordance with Company''s policy.

The Company operates on business model of primarily cash and carry along with sales to Subsidiary and credit risk from receivable perspective is not significant.

B) Liquidity risk

45 Ind AS 115 : Revenue from contracts with customers

The application of Ind AS 115 did not have any significant impact on recognition and measurement of revenue and related items in the standalone financial statements.

48 Other Statutory Information

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

(ii) The Company does not have any transactions with companies struck off

(iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year

(v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities

(Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

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

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

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

(viii) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets during the year ended 31^st March,2022.

(ix) The Company has not provided loans, advances in the nature of loans, stood guarantee, or provided security to Companies, Firms, limited liability partnerships

(x) The Company has not defaulted in repayment of loans, or other borrowings or payment of interest thereon to any lender.

(xi) The Company has not been declared willful defaulter by any bank, financial institution, government or government authority.

(xii) The quarterly returns/statements filed by the company with the banks are in agreement with the books of accounts of the company.

49 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 1st April, 2021. The Company has not early adopted any other standard or amendment that has been issued but is not yet effective:

i. Interest Rate Benchmark Reform - Phase 2: Amendments to Ind AS 109, Ind AS 107, Ind AS 104 and Ind AS 116

The amendments provide temporary reliefs which address the financial reporting effects when an interbank offered rate (IBOR) is replaced with an alternative nearly risk-free interest rate (RFR).

The amendments include the following practical expedients:

â¢ A practical expedient to require contractual changes, or changes to cash flows that are directly required by the reform, to be treated as changes to a floating interest rate, equivalent to a movement in a market rate of interest

â¢ Permit changes required by IBOR reform to be made to hedge designations and hedge documentation without the hedging relationship being discontinued

â¢ Provide temporary relief to entities from having to meet the separately identifiable requirement when an RFR instrument is designated as a hedge of a risk component

These amendments had no impact on the financial statements of the Company. The Company intends to use the practical expedients in future periods if they become applicable.

ii. Conceptual framework for financial reporting under Ind AS issued by ICAI

The Framework is not a Standard and it does not override any specific standard. Therefore, this does not form part of a set of standards pronounced by the standard-setters. While, the Framework is primarily meant for the standard-setter for formulating the standards, it has relevance to the preparers in certain situations such as to develop consistent accounting policies for areas that are not covered by a standard or where there is choice of accounting policy, and to assist all parties to understand and interpret the Standards.

The amendments made in following standards due to Conceptual Framework for Financial Reporting under Ind AS. includes amendment of the footnote to the definition of an equity instrument in Ind AS 102- Share Based Payments, footnote to be added for definition of liability i.e. definition of liability is not revised on account of revision of definition in conceptual framework in case of Ind AS 37 - Provisions, Contingent Liabilities and Contingent Assets etc.

The MCA has notified the Amendments to Ind AS consequential to Conceptual Framework under Ind AS vide notification dated June 18, 2021, applicable for annual periods beginning on or after April 1,2021. Accordingly, the Conceptual Framework is applicable for preparers for accounting periods beginning on or after 1 April 2021.

These amendments had no impact on the financial statements of the Company.

iii. Ind AS 116: COVID-19 related rent concessions

MCA issued an amendment to Ind AS 116 Covid-19-Related Rent Concessions beyond 30 June 2021 to update the condition for lessees to apply the relief to a reduction in lease payments originally due on or before 30 June 2022 from 30 June 2021. The amendment applies to annual reporting periods beginning on or after 1 April 2021. In case a lessee has not yet approved the financial statements for issue before the issuance of this amendment, then the same may be applied for annual reporting periods beginning on or after 1 April 2020.

These amendments had no impact on the financial statements of the Company.

iv. Ind AS 103: Business combination

The amendment states that to qualify for recognition as part of applying the acquisition method, the identifiable assets acquired and liabilities assumed must meet the definitions of assets and liabilities in the Framework for the Preparation and Presentation of Financial Statements in accordance with Indian Accounting Standards* issued by the Institute of Chartered Accountants of India at the acquisition date. Therefore, the acquirer does not recognise those costs as part of applying the acquisition method. Instead, the acquirer recognises those costs in its post-combination financial statements in accordance with other Ind AS.

These amendments had no impact on the financial statements of the Company.

v. Amendment to Ind AS 105, Ind AS 16 and Ind AS 28

The definition of âRecoverable amountâ is amended such that the words âthe higher of an asset''s fair value less costs to sell and its value in useâ are replaced with âhigher of an asset''s fair value less costs of disposal and its value in useâ. The consequential amendments are made in Ind AS 105, Ind AS 16 and Ind AS 28.

These amendments had no impact on the financial statements of the Company.

50. There are no new standards that are notified, but not yet effective, upto the date of issuance of Company''s standalone financial statements

51 Events after the reporting period

The Company has evaluated subsequent events from the balance sheet date through 14th May, 2022, the date at which the standalone financial statements were available to be issued, and determined that there are no material items to disclose other than those disclosed above.

52 We have considered the impact of COVID19 as evident so far in our above standalone financial statements. The Company will also continue to closely monitor any material changes to future economic conditions which necessitate any further modifications.

53. The previous year numbers have been reclassified wherever necessary.

Mar 31, 2021

2 Effective 1^st April, 2019, the company has adopted Ind AS 116 âLeases'' and applied the standard to all lease contracts existing on the date of initial application i.e. 1^st April, 2019. The company has used the modified retrospective approach for transitioning to Ind AS 116 with right-of-use asset recognized at an amount equal to the lease liability adjusted for any prepayments/accruals recognized in the balance sheet immediately before the date of initial application.

At the commencement date of a lease,the Company has recognised a liability to make lease payments (i.e., the lease liability) and an asset representing the right-of-use the underlying asset during the lease term (i.e., the right-of-use asset). The Company has separately recognised the interest expense on the lease liability and the depreciation expense on the right-of-use asset.

The company shall remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The company will generally recognise the amount of the re-measurement of the lease liability as an adjustment to the right-of-use asset.

The operating leases recorded on the balance sheet following implementation of Ind AS 116 are principally in respect of leasehold land and other identified assets representing right-of-use as per contracts excluding low value assets and short term leases of 12 months or less.

Leases previously accounted for as operating leases

The company recognised right of use assets and lease liabilities for those leases previously classified as operating leases, using term of non-cancellable and management intention to extend except for short-term leases and leases of low-value assets.

The right-of-use assets for most leases were recognised based on the carrying amount as if the standard had always been applied, apart from the use of incremental borrowing rate at the date of initial application. In some leases, the right of use assets were recognised based on the amount equal to the lease liabilities, adjusted for any related prepaid and accrued lease payments previously recognised. Lease liabilities were recognised based on the present value of the remaining lease payments, discounted using the incremental borrowing rate at the date of initial application.

The company has also applied the available practical expedients wherein it:

â¢ Used a single discount rate to a portfolio of leases with reasonably similar characteristics

â¢ Relied on its assessment of whether leases are onerous immediately before the date of initial application

â¢ Applied the short-term leases exemptions to leases with lease term that ends within 12 months at the date of initial application

â¢ Excluded the initial direct costs from the measurement of the right-of-use asset at the date of initial application

â¢ Used hindsight in determining the lease term where the contract contains options to extend or terminate the lease

â¢ Used practical expedients which permits lesses not to account for COVID-19 realted rent concessions as a lease modifications.

The company has no restrictions on the readability of its investment properties and no contractual obligations to purchase, construct or develop investment properties or for repairs, maintenance and enhancements.

Estimation of fair value

This valuation is based on valuations performed by an accredited independent valuer. Fair valuation is based on replacement cost method. The fair value measurement is categorized in level 2 fair value hierarchy.

The Company through Qualified Institutional Placement (QIP) allotted 20,000,000 equity shares to the eligible Qualified Institutional Buyers (QIB) at a issue price of '' 2,049 per equity share (including a premium of '' 2,039 per equity share) aggregating to '' 4,098 crore on 11^th February, 2020. The issue was made in accordance with the SEBl (Issue of Capital and Disclosure Requirements) Regulations, 2018 as amended (the âSEBI ICDR Regulationsâ), and Sections 42 and 62 of the Companies Act, 2013, as amended, including the rules made thereunder (the âIssueâ). Funds received pursuant to QIP are being utilised towards the object stated in the placement document and the balance unutilised as on 31^st March,2021 remain invested in deposits with scheduled commercial banks.

Expenses incurred by the company aggregating to '' 21.49 Crores, in connection with QIP have been adjusted towards securities premium in March 2020.

b) Terms and rights attached to equity shares

The company has only one class of equity shares having par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. The company if declares dividend would pay dividend in Indian rupees. The dividend if proposed by the Board of Directors would be subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

c) Shares reserved for issue under option

42 (a) Capital risk management

For the purpose of the company''s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders. The primary objective is to maximize the shareholders value.

The company manages its capital structure and makes adjustments in light of changes in economic condition and the requirements of the financial covenants. The company has raised capital by issue of equity shares through an Initial Public Offer (IPO) in the year ended 31^st March, 2017 and Qualified Institutional Placement (QIP) in the year ended 31^st March, 2020. Certain proceeds from the IPO and QIP have been used for repayment of borrowings which have significantly reduced the company''s borrowings and is NIL in the current year.

The capital structure is governed by policies approved by the Board of Directors and is monitored by various matrices funding requirements are reviewed periodically.

(b) Dividends

The company has not paid any dividend since its incorporation.

43 Fair values and fair value hierarchy

44 Share-based payments Employee stock option plan

During the year ended 31^st March, 2017, the company had instituted an Avenue Supermarts Limited Employee Stock Option Scheme, 2016 (âthe Schemeâ) as approved by the Board of Directors dated 23^rd July, 2016 for issuance of stock option to eligible employee of the company and of its subsidiaries.

45 Post retirement benefit plan

As per Indian Accounting Standard 19 âEmployee benefitsâ, the disclosures as defined are given below :

Defined Benefit Plan

The company operates a gratuity plan wherein every employees entitled to the benefit equivalent to fifteen days salary last drawn for each year of service. The same is payable on termination of sevice or retirement whichever is earlier. The benefit vest after five years of continuous service. The gratuity paid is governed by The Payment of Gratuity Act,1972. The company contributes to the fund based on actuarial report details of which is available in the table of investment pattern of plan asset, based on which the company is not exposed to market risk. The following table summarises the component of net benefit expenses recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for respective period.

There has been no change from the previous year in the method and assumptions used in perparing the sensitivity analysis.

These plans typically exposed the company to actuarial risks such as Interest risk, salary risk, investment risk, asset liability matching risk and mortality risk.

Gratuity is a defined benefit plan and company is exposed to the following risks:

Asset liability matching risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration risk: Plan is having a concentration risk as all the assets are invested with the insurance company and a default will wipe out all the assets. Although probability of this is very less as insurance companies have to follow regulatory guidelines.

46 Financial risk management

Financial risk management objectives and policies

The company''s financial principal liabilities comprises borrowings, lease liabilities, trade payables and other payables. The main purpose of these financial liabilities to finance the company operation. The company''s main financial assets includes trade and other receivable, cash and cash equivalent, other bank balances derived from its operations.

I n addition to risks inherent to our operations, we are exposed to certain market risks including change in interest rates and fluctuation in currency exchange rates.

A) Market Rate Risk

i) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flow of a financial instrument will fluctuate because of changes in market interest rate.

The company''s exposure to the risk of changes in market interest rates relates to primarily to company''s borrowing with floating interest rates. The company''s fixed rates of borrowing are carried at amortized cost. They are not subject to interest rate risk as defined in Ind AS 107, since neither carrying amount not the future cash flows will fluctuate because of a change in market interest rate. The company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings.

B) Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The company is exposed to credit risk from its operating activities (primarily trade receivable) and from its financial activities including deposits with banks and financial institution.

Credit risk from balances with banks is managed by the Company''s treasury department in accordance with Company''s policy. Since company operates on business model of primarily cash and carry, credit risk from receivable perspective is insignificant.

C) Liquidity risk

Liquidity risk is defined as the risk that the company will not be able to settle or meet its obligations on time, or at a reasonable price. Processes and policies related to such risk are overseen by senior management. Management monitors the company''s net liquidity position through rolling forecasts on the basis of expected cash flows.

Ind AS 115 requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when applying each step of the model to contracts with their customers. The standard also specifies the accounting for the incremental costs of obtaining a contract and the costs directly related to fulfilling a contract. In addition, the standard requires extensive disclosures.

The Company adopted Ind AS 115 using the modified retrospective method of adoption with the date of initial application of 1 April 2018. Under this method, the standard can be applied either to all contracts at the date of initial application or only to contracts that are not completed at this date. The Company elected to apply the standard to all contracts as at 1 April 2018.

The application of Ind AS 115 did not have any significant impact on recognition and measurement of revenue and related items in the financial results.

48 Events after the reporting period

The company has evaluated subsequent events from the balance sheet date through 8^th May, 2021, the date at which the financial statements were available to be issued, and determined that there are no material items to disclose other than those disclosed above.

49 The Code on Social Security 2020 has been notified in the Official Gazette on 29th Sep 2020, which could impact the contributions by the company towards certain employment benefits. The effective date from which the changes are applicable is yet to be notified, and the rules are yet to be framed. Impact if any of the change will be assessed and accounted in period of notification of the relevant provisions.

50. We have considered the impact of COVID19 as evident so far in our above published financial results. The Company will also continue to closely monitor any material changes to future economic conditions which necessitate any further modifications.

51. The previous year numbers have been reclassified wherever necessary.

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

Avenue Supermarts Limited

For S R B C & CO LLP Ignatius Navil Noronha Ramakant Baheti

Chartered Accountants Managing Director and Whole-time Director and

ICAI firm registration nuw mber 324982E/E300003 Chief Executive Officer Group Chief Financial Officer

DIN: 01787989 DIN: 00246480

per Vijay Maniar

Partner Niladri Deb Ashu Gupta

Membership No.: 36738 Chief Financial Officer Company Secretary

Mumbai, 8^th May, 2021 Mumbai, 8^th May, 2021

Mar 31, 2019

Corporate Information

Avenue Supermarts Limited (âthe Companyâ) is a company limited by shares and is domiciled in India. The Companyâs registered office is at Anjaneya, Opp. Hiranandani Foundation School, Powai, Mumbai - 400 076, Maharashtra, India.. The Company is primarily engaged in the business of organised retail and operates supermarkets under the brand name of âD-Martâ. Its equity shares are listed in India on BSE Limited and National Stock Exchange of India Limited.

The Financial Statements have been recommended for approval by the audit committee and is approved and adopted by the Board in their meeting held on 11^th May, 2019.

a) Terms and rights attached to equity shares

The Company has only one class of equity shares having par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The Company if declares dividend would pay dividend in Indian rupees. The dividend if proposed by the Board of Directors would be subject to the approval of the shareholders in the ensuing Annual General Meeting.

c) Shares reserved for issue under option

Information relating to Avenue Supermarts limited Employee Stock Option Scheme, 2016, including details of option granted, exercised and lapsed during the financial year and options outstanding at the end of the reporting period, is set out in Note 44.

1 MSME disclosure

The details of amounts outstanding to Micro and Small enterprises under the Micro and Small Enterprises Development Act, 2006 (MSED Act), based on the available information with the Company are as under:

2 Lease disclosure

The Company has entered into agreements for taking on lease certain office/store premises, warehouses. The lease term is for period ranging from 1 year to 30 years.

3 Contingent liabilities and commitments

(a) Contingent liabilities

Claims against the Company not acknowledged as debts

I t is not practicable for the Company to estimate the timings of cash outflows if any in respect of above pending resolutions of the respective proceedings.

The Company has reviewed all its pending litigation and proceedings and has adequately provided for where provisions are required and disclosed in contingent liabilities where applicable in itâs financial statements. The Company does not expect the outcome of these proceedings to have a materially adverse effect on itâs financial results.

The Company has process whereby periodically all long-term contracts are assessed for material foreseeable losses. At the year end, Company has reviewed and ensured that adequate provision as required under any law/accounting standard for material forseeable losses on such long-term contracts has been made in the books of accounts.

The Company is in the process of assessing retrospective applicability of the recent Supreme Court judgement on definition of basic wages for PF contributions. In absence of clarity, the Company has not made any provisions for retrospective application of the said SC ruling.

Amount spent during the year for corporate social responsibility (CSR) activities are in cash.

4 Segment information

The Companyâs business activity falls within a single primary business segment of retail and one reportable geographical segment which is âwithin Indiaâ. Accordingly, the Company is a single segment company in accordance with Indian Accounting Standard 108 âOperating Segmentâ.

5 The Company has not entered into any derivative transaction during the year. Unhedged foreign currency exposure at the end of the year is NIL.

6 Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of equity shares outstanding during the year.

7 (a) Capital risk management

For the purpose of the Companyâs capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders. The primary objective is to maximise the shareholders value.

The Company manages its capital structure and makes adjustments in light of changes in economic condition and the requirements of the financial covenants. The Company has raised capital by issue of equity shares through an IPO in the previous year ended 31^st March, 2017. Certain proceeds from the IPO have been used for repayment of borrowings which have significantly reduced the Companyâs borrowings.

The capital structure is governed by policies approved by the Board of Directors and is monitored by various matrices funding requirements are reviewed periodically.

(b) Dividends

The Company has not paid any dividend since its incorporation.

8 Fair values and fair value hierarchy

The carrying value of borrowings, deposits given and taken and other financial assets and liabilities are considered to be reasonably same as their fair values. These are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobseravable inputs including counter party credit risk.

9 Share-based payments Employee stock option plan

Pursuant to the said scheme, Stock options convertible into Nil (Previous year: Nil) equity shares of Rs.10 each were granted to eligible employee at an exercise prices of Rs.299/- being price at which fresh issue of shares made in initial public offer (IPO).

10 As per Indian Accounting Standard 19 âEmployee benefitsâ, the disclosures as defined are given below:

Defined Benefit Plan

The Company operates a gratuity plan wherein every employees entitled to the benefit equivalent to fifteen days salary last drawn for each year of service. The same is payable on termination of sevice or retirement whichever is earlier. The benefit vest after five years of continuous service. The gratuity paid is governed by The Payment of Gratuity Act,1972. The Company contibutes to the fund based on actuarial report details of which is available in the table of investment pattern of plan asset, based on which the Company is not exposed to market risk. The following table summarises the component of net benefit expenses recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for respective period.

There has been no change from the previous year in the method and assumptions used in perparing the sensitivity analysis.

These plans typically exposed the Company to acturial risks such as Interest risk, salary risk, investment risk, asset liability matching risk and mortality risk.

Gratuity is a defined benefit plan and company is exposed to the following risks:

Asset liability matching risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration Risk: Plan is having a concentration risk as all the assets are invested with the insurance company and a default will wipe out all the assets. Although probability of this is very less as insurance companies have to follow regulatory guidelines.

11 Financial risk management

Financial risk management objectives and policies

The Companyâs financial principal liabilities comprises borrowings, trade payables and other payables. The main purpose of these financial liabilities to finance the Company operation. The Companyâs main financial assets includes trade and other receivable, cash and cash equivalent, other bank balances derived from its operations.

I n addition to risks inherent to our operations, we are exposed to certain market risks including change in interest rates and fluctuation in currency exchange rates.

A) Market Rate Risk i) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flow of a financial instrument will fluctuate because of changes in market interest rate.

The Companyâs exposure to the risk of changes in market interest rates relates to primarily to companyâs borrowing with floating interest rates. The Companyâs fixed rates of borrowing are carried at amortised cost. They are not subject to interest rate risk as defined in Ind AS 107, since neither carrying amount not the future cash flows will fluctuate because of a change in market interest rate. The Company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on affected portion of loans and borrowings taken at floating rates. With all other variables held constant, the Companyâs profit before tax is affected through the impact on floating rate borrowing as follows:

B) Credit risk

Credit risk from balances with banks is managed by the Companyâs treasury department in accordance with Companyâs policy.

Since company operates on business model of primarily cash and carry, credit risk from receivable perspective is insignificant. Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time, or at a reasonable price. Processes and policies related to such risk are overseen by senior management. Management monitors the Companyâs net liquidity position through rolling forecasts on the basis of expected cash flows.

12 Events after the reporting period

The Company has evaluated subsequent events from the balance sheet date through 11^th May, 2019, the date at which the financial statements were available to be issued, and determined that there are no material items to disclose other than those disclosed above.

13 Ind AS issued and effective from current year

Ind AS 115: Revenue from Contracts with Customers

The Company applied Ind AS 115 for the first time. The nature and effect of the changes as a result of adoption of these new accounting standards are described below.

I nd AS 115 supersedes Ind AS 11 Construction Contracts and Ind AS 18 Revenue and it applies, with limited exceptions, to all revenue arising from contracts with customers. Ind AS 115 establishes a five-step model to account for revenue arising from contracts with customers and requires that revenue be recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer.

I nd AS 115 requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when applying each step of the model to contracts with their customers. The standard also specifies the accounting for the incremental costs of obtaining a contract and the costs directly related to fulfilling a contract. In addition, the standard requires extensive disclosures.

The Company adopted Ind AS 115 using the modified retrospective method of adoption with the date of initial application of 1^st April, 2018. Under this method, the standard can be applied either to all contracts at the date of initial application or only to contracts that are not completed at this date. The Company elected to apply the standard to all contracts as at 1^st April, 2018.

The application of Ind AS 115 did not have any significant impact on recognition and measurement of revenue and related items in the financial results.

14 Ind AS issued but not effective

The Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Amendment Rules, 2017 and Companies (Indian Accounting Standards) Amendment Rules, 2018 amending the following standard which the Company intends to adopt, when they become effective.

Appendix C to Ind AS 12 Uncertainty over Income Tax Treatment

The Interpretation addresses the accounting for income taxes when tax treatments involve uncertainty that affects the application of Ind AS 12 and does not apply to taxes or levies outside the scope of Ind AS 12, nor does it specifically include requirements relating to interest and penalties associated with uncertain tax treatments. The Interpretation specifically addresses the following:

- Whether an entity considers uncertain tax treatments separately

- The assumptions an entity makes about the examination of tax treatments by taxation authorities

- How an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates

- How an entity considers changes in facts and circumstances

An entity has to determine whether to consider each uncertain tax treatment separately or together with one or more other uncertain tax treatments. The approach that better predicts the resolution of the uncertainty should be followed. In determining the approach that better predicts the resolution of the uncertainty, an entity might consider, for example, (a) how it prepares its income tax filings and supports tax treatments; or (b) how the entity expects the taxation authority to make its examination and resolve issues that might arise from that examination.

The interpretation is effective for annual reporting periods beginning on or after 1^st April, 2019, but certain transition reliefs are available. These amendments are not applicable to the Company.â

Amendments to Ind AS 109: Prepayment Features with Negative Compensation

Under Ind AS 109, a debt instrument can be measured at amortised cost or at fair value through other comprehensive income, provided that the contractual cash flows are âsolely payments of principal and interest on the principal amount outstandingâ (the SPPI criterion) and the instrument is held within the appropriate business model for that classification. The amendments to Ind AS 109 clarify that a financial asset passes the SPPI criterion regardless of the event or circumstance that causes the early termination of the contract and irrespective of which party pays or receives reasonable compensation for the early termination of the contract.

The amendments should be applied retrospectively and are effective for annual periods beginning on or after 1^st April, 2019. These amendments are not applicable to the Company.

Amendments to Ind AS 19: Plan Amendment, Curtailment or Settlement

The amendments to Ind AS 19 address the accounting when a plan amendment, curtailment or settlement occurs during a reporting period. The amendments specify that when a plan amendment, curtailment or settlement occurs during the annual reporting period, an entity is required to:

- Determine current service cost for the remainder of the period after the plan amendment, curtailment or settlement, using the actuarial assumptions used to remeasure the net defined benefit liability (asset) reflecting the benefits offered under the plan and the plan assets after that event.

- Determine net interest for the remainder of the period after the plan amendment, curtailment or settlement using: the net defined benefit liability (asset) reflecting the benefits offered under the plan and the plan assets after that event; and the discount rate used to remeasure that net defined benefit liability (asset).

The amendments also clarify that an entity first determines any past service cost, or a gain or loss on settlement, without considering the effect of the asset ceiling. This amount is recognised in profit or loss.

An entity then determines the effect of the asset ceiling after the plan amendment, curtailment or settlement. Any change in that effect, excluding amounts included in the net interest, is recognised in other comprehensive income.

The amendments apply to plan amendments, curtailments, or settlements occurring on or after the beginning of the first annual reporting period that begins on or after 1^st April, 2019. These amendments are not applicable to the Company.

Amendments to Ind AS 28: Long-term interests in associates and joint ventures

The amendments clarify that an entity applies Ind AS 109 to long-term interests in an associate or joint venture to which the equity method is not applied but that, in substance, form part of the net investment in the associate or joint venture (long-term interests). This clarification is relevant because it implies that the expected credit loss model in Ind AS 109 applies to such long-term interests. The amendments also clarified that, in applying Ind AS 109, an entity does not take account of any losses of the associate or joint venture, or any impairment losses on the net investment, recognised as adjustments to the net investment in the associate or joint venture that arise from applying Ind AS 28 Investments in Associates and Joint Ventures. The amendments should be applied retrospectively in accordance with Ind AS 8 for annual reporting periods on or after 1^st April, 2019. Since the Company does not have such long-term interests in its associate and joint venture, the amendments will not have an impact on its financial statements.

Annual improvement to Ind AS (2018);

These improvements include:

Amendments to Ind AS 103: Party to a Joint Arrangements obtains control of a business that is a Joint Operation The amendments clarify that, when an party to a joint arrangement obtains control of a business that is a joint operation, it applies the requirements for a business combination achieved in stages, including remeasuring previously held interests in the assets and liabilities of the joint operation at fair value. In doing so, the acquirer remeasures its entire previously held interest in the joint operation.

An entity applies those amendments to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after 1^st April, 2019. These amendments are not applicable to the Company

Amendments to Ind AS 111: Joint Arrangements

A party that participates in, but does not have joint control of, a joint operation might obtain joint control of the joint operation in which the activity of the joint operation constitutes a business as defined in Ind AS 103. The amendments clarify that the previously held interests in that joint operation are not remeasured.

An entity applies those amendments to transactions in which it obtains joint control on or after the beginning of the first annual reporting period beginning on or after 1^st April, 2019. These amendments are not applicable to the Company.

Amendments to Ind AS 12: Income Taxes

The amendments clarify that the income tax consequences of dividends are linked more directly to past transactions or events that generated distributable profits than to distributions to owners. Therefore, an entity recognises the income tax consequences of dividends in profit or loss, other comprehensive income or equity according to where the entity originally recognised those past transactions or events.

An entity applies those amendments for annual reporting periods beginning on or after 1^st April, 2019. Since the Companyâs current practice is in line with these amendments, the Company does not expect any effect on its financial statements.

Amendments to Ind AS 23: Borrowing Costs

The amendments clarify that an entity treats as part of general borrowings any borrowing originally made to develop a qualifying asset when substantially all of the activities necessary to prepare that asset for its intended use or sale are complete.

An entity applies those amendments to borrowing costs incurred on or after the beginning of the annual reporting period in which the entity first applies those amendments. An entity applies those amendments for annual reporting periods beginning on or after 1^st April, 2019. Since the Companyâs current practice is in line with these amendments, the Company does not expect any effect on its financial statements.

Ind AS 116: Leases

I nd AS 116 Leases was notified by MCA on 30^th March, 2019 and it replaces Ind AS 17 Leases, including appendices thereto. Ind AS 116 is effective for annual periods beginning on or after 1^st April, 2019. Ind AS 116 sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the accounting for finance leases under Ind AS 17. The standard includes two recognition exemptions for lessees - leases of âlow-valueâ assets (e.g., personal computers) and short-term leases (i.e. leases with a lease term of 12 months or less).

At the commencement date of a lease, a lessee will recognise a liability to make lease payments (i.e. the lease liability) and an asset representing the right to use the underlying asset during the lease term (i.e. the right-of-use asset). Lessees will be required to separately recognise the interest expense on the lease liability and the depreciation expense on the right-of-use asset.

Lessees will be also required to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognise the amount of the re-measurement of the lease liability as an adjustment to the right-of-use asset.

Lessor accounting under Ind AS 116 is substantially unchanged from todayâs accounting under Ind AS 17. Lessors will continue to classify all leases using the same classification principle as in Ind AS 17 and distinguish between two types of leases: operating and finance leases.

The Company will implement Ind AS 116 from 1^st April, 2019 by applying the modified retrospective approach, meaning that the comparative figures in the financial statements for the year ending 31^st March 2019 will not be restated to show the impact of Ind AS 116.

The operating leases which will be recorded on the balance sheet following implementation of Ind AS 116 are principally in respect of leasehold premises and other identified assets representing right to use as per contracts excluding low value assets and shortterm leases of 12 months or less.

The anticipated impact of the standard on the Company is not yet known though is not expected to be material on the income statement or net assets though assets and liabilities will be grossed up for the net present value of the outstanding operating lease liabilities as at 1^st April, 2019. See note 36 for information on operating lease commitments.

15. The previous year numbers have been reclassified wherever necessary.

Mar 31, 2018

1.Lease disclosure

The company has entered into agreements for taking on lease certain office/store premises, warehouses. The lease term is for period ranging from 1 year to 30 years.

The initial non-cancellable period of lease contracts have been taken for the disclosure above.

2. Contingent liabilities and commitments

(a) Contingent liabilities

Claims against the company not acknowledged as debts

I t is not practicable for the company to estimate the timings of cash outflows, if any in respect of above pending resolutions of the respective proceedings.

The company has reviewed all its pending litigation and proceedings and has adequately provided for where provisions are required and disclosed in contingent liabilities where applicable in it''s financial statements. The company does not expect the outcome of these proceedings to have a materially adverse effect on it''s financial results.

The company has process whereby periodically all long-term contracts are assessed for material foreseeable losses. At the year end, Company has reviewed and ensured that adequate provision as required under any law/accounting standard for material for seeable losses on such long-term contracts has been made in the books of accounts.

Amount spent during the year for corporate social responsibility (CSR) activities are in cash.

3. Segment information

The company''s business activity falls within a single primary business segment of retail and one reportable geographical segment which is âwithin India''. Accordingly, the Company is a single segment company in accordance with Indian Accounting Standard 108 âOperating Segment''.

4. The company has not entered into any derivative transaction during the year. Unhedged foreign currency exposure at the end of the year is NIL.

5. Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of equity shares outstanding during the year.

The following reflects the profit and share data used in the basic and diluted EPS computation:

6. (a) Capital risk management

The company manages its capital structure and makes adjustments in light of changes in economic condition and the requirements of the financial covenants. The company has raised capital by issue of equity shares through an IPO in the previous year ended 31^st March, 2017. Certain proceeds from the IPO have been used for repayment of borrowings which have significantly reduced the company''s borrowings.

The capital structure is governed by policies approved by the Board of Directors and is monitored by various matrices funding requirements are reviewed periodically.

(b) Dividends

The company has not paid any dividend since its incorporation.

7. Fair values and fair value hierarchy

8. Share-based payments Employee stock option plan

During the previous year ended 31^st March, 2017, the company had instituted an Avenue Super marts Limited Employee Stock Option Scheme, 2016 (âthe Scheme'') as approved by the Board of Directors dated 23^rd July, 2016 for issuance of stock option to eligible employee of the company and of its subsidiaries.

Pursuant to the said scheme, Stock options convertible into Nil (Previous year: 13,973,325) equity shares of '' 10 each were granted to eligible employee at an exercise prices of '' 299/- being price at which fresh issue of shares made in initial public offer (IPO).

Exercise period, would commence from the date of options are vested and will expire at the end of three months from the date of vesting.

9. As per Indian Accounting Standard 19 âEmployee benefits'', the disclosures as defined are given below:

Defined Benefit Plan

The company operates a gratuity plan wherein every employees entitled to the benefit equivalent to fifteen days salary last drawn for each year of service. The same is payable on termination of service or retirement whichever is earlier. The benefit vest after five years of continuous service. The gratuity paid is governed by The Payment of Gratuity Act,1972. The company contributes to the fund based on actuarial report details of which is available in the table of investment pattern of plan asset, based on which the company is not exposed to market risk. The following table summarizes the component of net benefit expenses recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for respective period.

There has been no change from the previous year in the method and assumptions used in preparing the sensitivity analysis.

These plans typically exposed the company to acturial risks such as Interest risk, salary risk, investment risk, asset liability matching risk and mortality risk.

Gratuity is a defined benefit plan and company is exposed to the following risks:

Asset liability matching risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

10. Financial risk management

Financial risk management objectives and policies

The company''s financial principal liabilities comprises borrowings, trade payables and other payables. The main purpose of these financial liabilities to finance the company operation. The company''s main financial assets includes trade and other receivable, cash and cash equivalent, other bank balance that derive from its operations.

I n addition to risks inherent to our operations, we are exposed to certain market risks including change in interest rates and fluctuation in currency exchange rates.

A) Market Rate Risk i) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flow of a financial instrument will fluctuate because of changes in market interest rate.

The company''s exposure to the risk of changes in market interest rates relates to primarily to company''s Short-term borrowing with floating interest rates. The company''s fixed rates of borrowing are carried at amortized cost. They are not subject to interest rate risk as defined in Ind AS 107, since neither carrying amount not the future cash flows will fluctuate because of a change in market interest rate. The company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on affected portion of loans and borrowings taken at floating rates. With all other variables held constant, the company''s profit before tax is affected through the impact on floating rate borrowing as follows:

B) Credit risk

Credit risk from balances with banks is managed by the Company''s treasury department in accordance with Company''s policy.

Since company operates on business model of primarily cash and carry, credit risk from receivable perspective is insignificant.

Liquidity risk

11. Events after the reporting period

The company has evaluated subsequent events from the balance sheet date through 5^th May, 2018, the date at which the financial statements were available to be issued, and determined that there are no material items to disclose other than those disclosed above.

12. Ind AS issued but not effective

The Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Amendment Rules, 2017 and Companies (Indian Accounting Standards) Amendment Rules, 2018 amending the following standard which the company intends to adopt, when they become effective.

Ind AS 115: Revenue from Contracts with Customers

I nd AS 115 was notified on 28^th March 2018 and establishes a five-step model to account for revenue arising from contracts with customers. Under Ind AS 115, revenue is recognized at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer.

The new revenue standard will supersede all current revenue recognition requirements under Ind AS. This new standard requires revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions of the company. Ind AS 115 is effective for the company in the first quarter of fiscal 2019 using either one of two methods: (i) retrospectively to each prior reporting period presented in accordance with Ind AS 8 Accounting Policies, Changes in Accounting Estimates and Errors, with the option to elect certain practical expedients as defined within Ind AS 115 (the full retrospective method); or (ii) retrospectively with the cumulative effect of initially applying Ind AS 115 recognized at the date of initial application (1^st April 2018) and providing certain additional disclosures as defined in Ind AS 115 (the modified retrospective method).

The company continues to evaluate the available transition methods and its contractual arrangements. The ultimate impact on revenue resulting from the application of Ind AS 115 will be subject to assessments that are dependent on many variables, including, but not limited to, the terms of the contractual arrangements and the mix of business. The company''s considerations also include, but are not limited to, the comparability of its financial statements and the comparability within its industry from application of the new standard to its contractual arrangements. The company has established an implementation team to implement Ind AS 115 related to the recognition of revenue from contracts with customers and it continues to evaluate the changes to accounting system and processes, and additional disclosure requirements that may be necessary.

Upon adoption the company does not expects to have material changes in the recognition of revenue from the current practice. A reliable estimate of the quantitative impact of Ind AS 115 on the financial statements will only be possible once the implementation project has been completed.

Ind AS 40: Investment property

The amendments clarify when an entity should transfer property, including property under construction or development into, or out of investment property. The amendments state that a change in use occurs when the property meets, or ceases to meet, the definition of investment property and there is evidence of the change in use. A mere change in management''s intentions for the use of a property does not provide evidence of a change in use.

Entities should apply the amendments prospectively to changes in use that occur on or after the beginning of the annual reporting period in which the entity first applies the amendments. An entity should reassess the classification of property held at that date and, if applicable, reclassify property to reflect the conditions that exist at that date. Retrospective application in accordance with Ind AS 8 is only permitted if it is possible without the use of hindsight.

The amendments are effective for annual periods beginning on or after 1^st April, 2018. Upon adoption the company does not expects to have material changes in the recognition of investment property from the current practice. A reliable estimate of the quantitative impact of Ind AS 40 on the financial statements will only be possible once the implementation project has been completed.

Ind AS 28: Investments in associates and joint ventures

Clarification that measuring investees at fair value through profit or loss is an investment-by-investment choice The amendments clarify that:

An entity that is a venture capital organization, or other qualifying entity, may elect, at initial recognition on an investment-by-investment basis, to measure its investments in associates and joint ventures at fair value through profit or loss.

If an entity, that is not itself an investment entity, has an interest in an associate or joint venture that is an investment entity, the entity may, when applying the equity method, elect to retain the fair value measurement applied by that investment entity associate or joint venture to the investment entity associate''s or joint venture''s interests in subsidiaries. This election is made separately for each investment entity associate or joint venture, at the later of the date on which: (a) the investment entity associate or joint venture is initially recognized; (b) the associate or joint venture becomes an investment entity; and (c) the investment entity associate or joint venture first becomes a parent.

The amendments should be applied retrospectively and are effective from 1^st April, 2018. These amendments are not applicable to the company.

Ind AS 12: Recognition of deferred tax assets for unrealized losses

The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how an entity should determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than their carrying amount.

Entities are required to apply the amendments retrospectively. However, on initial application of the amendments, the change in the opening equity of the earliest comparative period may be recognized in opening retained earnings (or in another component of equity, as appropriate), without allocating the change between opening retained earnings and other components of equity. Entities applying this relief must disclose that fact.

These amendments are effective for annual periods beginning on or after 1^st April, 2018. These amendments are not applicable to the company.

14. The previous year numbers have been audited by an audit firm other than S R B C & Co LLP. The previous year numbers have been reclassified wherever necessary.

Mar 31, 2017

Estimation of fair value

(iv) On transition to Ind AS, the Company has elected to continue with the carrying value of all its Investment properties recognized as at 1^st April, 2015 measured as per the previous GAAP and use that carrying value as the deemed cost of Investment properties.

b) Terms and rights attached to equity shares

Equity shares have a par value of Rs. 10. They entitle the holder to participate in dividends, and to share in the proceeds of winding up the company in proportion to the number of and amounts paid on the shares held.

c) Shares reserved for issue under option

information relating to Avenue Supermarts limited Employee Stock Option Scheme, 2016, including details of option granted, exercised and lapsed during the financial year and options outstanding at the end of the reporting period, is set out in note 44.

1 The Company''s business activity falls within a single primary business segment of retail and one reportable geographical segment which is âwithin India". Accordingly, the Company is a single segment company in accordance with Indian Accounting Standard 108 âOperating Segment".

2. As per the requirement of Section 149 of the Companies Act, 2013 and the rules made thereunder, the Company is required to appoint two independent directors. The Board of Directors, vide resolution dated 11^th August, 2014, recognized Mr. Ramesh Damani as independent Director duly confirmed by vide shareholders approval at their meeting convened on 30^th September, 2014. However, considering the business in which the Company deals in the expertise required in various fields, the process of appointing on more independent directors was completed only on 17^th May, 2016. Based on the Company''s application to the Central Government, the delay has been compounded under the order of Ministry of Corporate Affairs.

3 (A) CAPITAL RISK MANAGEMENT

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

The Company manages its capital structure and makes adjustments in light of changes in economic condition and the requirements of the financial covenants. The Company has raised capital by issue of equity shares through an IPO (Refer Note : 16). Certain proceeds from the IPO are proposed to be used for repayment of loans which shall significantly reduce the Company''s borrowings.

(B) DIVIDENDS

The Company has not paid any dividend since its incorporation.

4 SHARE-BASED PAYMENTS

Employee stock option plan

During the year, the Company has instituted an Avenue Supermarts Limited Employee Stock Option Scheme, 2016 (âthe Scheme") as approved by the Board of Directors for issuance of stock option to eligible employee of the Company and of its subsidiaries.

Pursuant to the said scheme, Stock options convertible into 1,39,73,325 (Previous year Nil) equity shares of Rs. 10 each were ganted to eligible employee at an exercise prices of Rs. 2997-being price at which fresh issue of shares made in IPO.

5 POST RETIREMENT BENEFIT PLANS

As per Actuarial Valuation as on 31^st March, 2017, 2016 and 1^st April, 2015 and recognized in the financial statements in respect of Employee Benefit Schemes:

E. Assumptions

With the objective of presenting the plan assets and plan liabilities of the defined benefits plans and post retirement benefits at their fair value on the balance sheet, assumptions under Ind AS 19 are set by reference to market conditions at the valuation date

The sensitivity analyses above have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period and may not be representative of the actual change. It is based on a change in the key assumption while holding all other assumptions constant. When calculating the sensitivity to the assumption, the same method used to calculate the liability recognized in the balance sheet has been applied. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared with the previous period.

6 FINANCIAL RISK MANAGEMENT

Financial risk management objectives and policies

in addition to risks inherent to our operations, we are exposed to certain market risks including change in interest rates and fluctuation in currency exchange rates.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flow of a financial instrument will fluctuate because of changes in market interest rate.

The Company''s exposure to the risk of changes in market interest rates relates to primarily to Company''s short term borrowing with floating interest rates. The Company''s fixed rates of borrowing are carried at amortized cost. They are not subject to interest rate risk as defined in Ind AS 107, since neither carrying amount not the future cash flows will fluctuate because of a change in market interest rate.

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flow of an exposure will fluctuate because of change in foreign exchange rates. The Company''s exposure to risk of changes in foreign exchange rates primarily relates to its import activity with respect to US$.

The Company believes that its business operating model is capable of managing it''s exposure to foreign exchange risk and hence the Company does not hedge its foreign commercial transaction.

Foreign currency sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in USD and other exchange rates, with all other variable held constant. The impact on the Company''s profit before tax is due to change in foreign exchange rate for its import activity and unable to recover the same through price increase.

Credit risk

Credit risk is the risk that counter party will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivable) and from its financial activities including deposits with banks and financial institution.

The Company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis through each reporting period. To assess whether there is a significant increase in credit risk the Company compares the risk of default occurring on asset as at the reporting date with the risk of default as at the date of initial recognition. It considers reasonable and supportive forwarding-looking information such as:

i) Actual or expected significant adverse changes in business,

ii) Actual or expected significant changes in the operating results of the counterparty,

iii) Financial or economic conditions that are expected to cause a significant change to the counterparty''s ability to meet its obligations,

iv) Significant increase in credit risk on other financial instruments of the same counterparty,

v) Significant changes in the value of the collateral supporting the obligation or in the quality of the third-party guarantees or credit enhancements .

Financial assets where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognized as income in the statement of profit and loss.

Since Company operates on business model of primarily cash and carry, credit risk from receivable perspective is insignificant.

Liquidity Risk

7 FAIR VALUE MEASUREMENT

Financial Instrument by category and hierarchy

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

1. Fair value of cash and deposits, trade and other receivables, trade payables, other current liabilities, short term loans from banks approximate their carrying amounts largely due to short term maturities of these instruments.

3. For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

8 FIRST-TIME ADOPTION OF IND AS

The Company has adopted Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs with effect from 1^st April, 2016, with a transition date of 1^st April, 2015. The adoption of Ind AS has been carried out in accordance with Ind AS 101, First-time Adoption of Indian Accounting Standards. Ind AS 101 requires that all Ind AS standards and interpretations that are issued and effective for the first Ind AS financial statements for the year ended 31^st March, 2017, be applied retrospectively and consistently for all financial years presented. However, in preparing these Ind AS financial statements, the Company has availed of certain exemptions and exceptions in accordance with Ind AS 101, as explained below. The resulting difference between the carrying values of the assets and liabilities in the financial statements as at the transition date under Ind AS and Previous GAAP have been recognized directly in equity (retained earnings or another appropriate category of equity).

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

A. Optional Exemptions

(a) Deemed Cost

The Company has opted and accordingly considered the carrying value of property, plant and equipment, Intangible assets and Investment properties as deemed cost as at transition date.

(b) Investments in subsidiaries and associate

The Company has opted para D14 and D15 and accordingly considered the cost of Investments as deemed cost as at transition date.

B. Mandatory Exceptions

(a) Estimates

An entity''s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies).

(b) Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

C. Transition to Ind AS - Reconciliations

The following reconciliations provide a quantification of the effect of significant differences arising from the transition from previous GAAP to Ind AS in accordance with Ind AS 101:

I. Reconciliation of Balance sheet as at 1^st April, 2015 (Transition Date)

II. A. Reconciliation of Balance sheet as at 31^st March, 2016

B. Reconciliation of Statement of total Comprehensive Income for the year ended 31^st March, 2016

III. Reconciliation of Equity as at 1^st April, 2015 and 31^st March, 2016

IV Adjustments to Statement of Cash Flows

The presentation requirements under Previous GAAP differs from Ind AS and hence Previous GAAP information has been regrouped for ease of reconciliation with Ind AS. The Regrouped Previous GAAP information is derived from the Financial Statements of the Company prepared in accordance with Previous GAAP.

Notes to first time adoption

The following explains the material adjustments made while transition from previous accounting standards to Ind AS,

A As required under Paragraph (10C) of Ind AS 101 the Company has reclassified items that it recognized in accordance with previous GAAP as one type of asset, liability or component of equity, but are a different type of asset, liability or component of equity in accordance with Ind AS.

B Remeasurements of post employment benefit obligation Under Ind AS, remeasurements i.e. acturial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognized in other comprehensive income instead of profit and loss. Under the previous GAAP, these remeasurements were forming part of the profit and loss for the year. As a result of this change, the profit for the year ended 31^st March, 2016 increase by Rs. 42.69 Lakhs There is no impact on the total equity as at 1^stApril, 2015.

C Bank Overdrafts

Under Ind AS, bank overdrafts repayable on demand and which form an integral part of the cash management process are included in cash and cash equivalents for the purpose of presentation of statement of cash flows. Under previous GAAP, bank overdrafts were considered as part of borrowings and movements in bank overdrafts were shown as part of financing activities. Consequently, cash and cash equivalents have reduced by Rs. 19.76 Lakhs as at 31^st March 2016 (1^st April, 2015 - Rs. 23.52 Lakhs) and cash flows from financing activities for the year ended 31^st March 2017 have also reduced by Rs. 0.19 Lakhs to the effect of the movements in bank overdrafts.

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