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Notes to Accounts of AVT Natural Products Ltd.
Mar 31, 2025
3.11 Provisions & contingent liability:
Provisions are recognized, when there is a present legal or constructive obligation as a result of a past event, it is
probable that an outflow of resources will be required to settle the obligation, and when a reliable estimate of the
amount of the obligation can be made. If the effect of the time value of money is material, the non - current provisions
are discounted using a pre-tax rate that reflects current market assessments of the time value of money and the risks
specific to the obligation and the unwinding of the discount is recognised as interest expense.
Contingent liabilities are recognized only when there is a possible obligation arising from past events, due to 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. Obligations are assessed on an ongoing basis and only those having a largely probable
outflow of resources are provided for. The Company does not recognise contingent liability but discloses its existence
in financial statements.
3.12 Dividends:
Final Dividends on shares are recorded as a liability on the date of approval by the shareholders and interim dividends
are recorded as liability on the date of declaration by the Company''s Board of Directors.
3.13 segment Reporting:
The Company identifies operating segments based on the internal reporting provided to the chief operating decision¬
maker.
The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the
operating segments, has been identified as the Board of Directors that makes strategic decisions.
The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.
Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on
the basis of their relationship to the operating activities of the segment. The Company operates in a single segment
namely solvent extracted products and geographically operates primarily in a single segment.
3.14 Research and development:
Expenditure on research phase is recognised as an expense as and when it is incurred. Expenditure on development
phase is recognized as intangible assets if it is identifiable, capable of being controlled and from which future economic
benefits are expected to flow to the enterprise. Intangible assets are stated at cost net of tax / duty credits availed, if
any, less accumulated amortisation and cumulative impairment.
Note 5.1 - Amortisation
Amortisation is calculated over the estimated useful life of the asset. Refer Accounting policy no. 3.1.2 of the company
for the method of amortisation. The company is amortizing the other intangible assets - software over a period of 5 years
Note 5.2 - Impairment of assets
Refer Note No. 49 for disclosure relating to impairment of assets
Note 5.3 - Restriction on title - Nil
Note 5.4 - Contractual Commitments
Refer Note No. 37 for outstanding contractual commitments.
The company has one class of equity shares having a par value of Rs. 1 per share. Each shareholder is eligible for
one vote share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders
in the ensuing Annual General Meeting, except in case of Interim Dividend. In the event of the liquidation, the equity
shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts,
in proportion to the shareholding.
D. Shares reserved under option and contract/commitments for sale of shares/disinvestment - Nil (31st March 2024 - Nil)
E. The aggregate value of calls unpaid (including Directors and Officers of the Company) - Nil (31st March 2024 - Nil)
F. There were no bonus share issue/ buy back of shares in the immediately preceding 5 years.
G. The Company has not allotted any shares as fully paid up pursuant to contract without payment being received in cash in the
immediately preceding 5 years..
Nature and purpose of other reserves
1 Capital Reserve - Reserve of capital nature taken to this head under the erstwhile GAAP.
2 General Reserve - General Reserve is created out of the profits earned by the Company by way of transfer from
surplus in the statement of profit and loss. Mandatory transfer to general reserve is not required under the Companies
Act 2013.
3 Retained Earnings: Retained earnings are the profits that the Company has earned till date, less any transfers to
general reserve, dividends or other distributions paid to shareholders.
4 Cash flow Hedging Reserve: The cash flow hedging reserve represents the cumulative effective portion of gains or
losses arising on changes in fair value of designated portion of hedging instruments entered into for cash flow hedges.
Such gains or losses will be reclassified to statement of profit and loss in the period in which the underlying hedged
transaction occurs
Foot Note:
1. Term loan from banks
(i) Term Loan 1: The company had availed a term loan for a period of five years with half yearly instalments. Secured
by first charge on 27.01 acres of leasehold land and movable fixed assets and buildings (value of buildings and
movable fixed assets being Rs. 3,498 Lakhs). Rate of Interest - 9.70% p.a (31st March 2024 - 9.70% p.a.). The
loan was fully repaid and in July 2024.
(ii) Term Loan 2: The company has taken an additional term loan for a period of six years including a moratorium
of 1 year. The loan is repayable in 10 equal half yearly instalments with repayment commencing from February
2023 and the last instalment due being August 2028. Secured by first charge on assets created out of the term
loan.Rate of Interest - 8.50% p.a. (31st March 2024 - 8.75% p.a).
Packing Credit from Banks (*)
Packing credit from banks secured by
- hypothecation of present and future current assets including stocks, semi-finished goods, finished goods,
consumables, stores, spares, book debts.
- 15% margin on sight import letter of credit and performance guarantee
- In some cases second pari passu charge by way of hypothecation and mortgage of movable and immovable
assets of the Company, second charge on entire fixed assets of the Company including EM, In some cases
demand promissory note, hypothecation of book debts, letter of containing security, deposit of letter of credit
âPeriod and amount of default as on 31st March 2025 - Nil (31st March 2024 - Nil)
No loans have been guaranteed by Directors or Othersâ
The estimate of future salary increases, considered in actuarial valuation, takes into account inflation, seniority, promotions
and other relevant factors. The above information has been certified by the actuary and has been relied upon by the
Auditors.
Exposure to Risks:
These plans typically expose the Company to actuarial risks such as: interest rate risk, longevity risk and salary risk.
Interest risk: A decrease in the Government Securities (G-Sec Bonds) interest rate will increase the plan liability.
Longevity risk: The present value of the defined benefit plan liability is calculated by reference to the best estimate of
the mortality of plan participants during their employment. An increase in the life expectancy of the plan participants will
increase the plan''s liability.
Salary risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan
participants. As such, an increase in the salary of the plan participants will increase the plan''s liability.
NOTE 36
RELATED PARTY TRANSACTIONS
A: details of related parties:
(a) Directors who held the office during the year:
Mr. Ajit Thomas
Mr. M A Alagappan ( Upto 24-07-2024)
Mr. P Shankar (Upto 24-07-2024)
Mr. Habib Hussain (Upto 09-08-2024)
Mr. A D Bopana
Mrs. Shanthi Thomas
Mrs. Kavitha Vijay
Mr. M M Venkatachalam (From 25-07-2024)
Mr. Rahul Thomas (From 12-06-2024)
Mr. Ranganath N Krishna (From 25-07-2024)
(b) Key Management Personnel (KMP):
Mr. Balasundaram Krishnakumar Sr. Vice President and Manager (Upto 31-03-2025)
Mr. A. Ramadas, Sr. Vice President and Chief Financial Officer
Mr. Sharon Josh, Company Secretary (Upto 21-07-2024)
Mr. P Mahadevan, Company Secretary (From 12-11-2024)
(c) subsidiaries
AVT Natural Europe Limited, UK (formerly known as ''AVT Tea Services Limited'')
AVT Natural S.A. DE C.V
AVT Natural North America Inc., USA (step down subsidiary)
AVT Natural FZCO, Dubai
Entities/Persons with whom transactions carried out / were carried in current / previous year
(d) Entities having significant influence over the reporting entity
The Midland Rubber and Produce Company Limited
Neelamalai Agro Industries Limited
(e) Entities with common control through board composition / shareholding
AVT Gavia Foods Private Limited
The Nelliampathy Tea and Produce Company Limited
A V Thomas & Company Limited
Midland Corporate Advisory Services Private Limited
AVT McCormick Ingredients Private Limited
Midland Charitable Trust
Parry Agro Industries Ltd.
(f) Relatives of the directors
Mr. Rahul Thomas - Son of Mr. Ajit Thomas
Mr. Ashwin Thomas - Son of Mr. Ajit Thomas
Mrs. Shabri Roberson - Daughter of Mrs Shanthi Thomas
C. Fair value of Financial Instruments measured at amortised cost :
Due to the short-term nature of cash and cash equivalents and the short-term maturities of trade receivables, loans,
borrowings-current, financial liabilities and assets the management considers that the carrying amount of assets and
liabilities recognised at amortised cost in financial statements is approximate to their fair value.
The fair value of financial instruments as referred to in note (A) above has been classified into three categories
depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in
active markets for identical assets or liabilities [Level 1 measurements] and lowest priority to unobservable inputs
[Level 3 measurements].
D. Valuation inputs and relationship to fair value
There are no material level 3 fair value measurements in respect of the financial assets and liabilities of the company.
NOTE 43
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company''s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other
payables. The main purpose of these financial liabilities is to finance the Company''s operations and to provide guarantees
to support its operations. The Company''s principal financial assets include loans, trade and other receivables, and cash
and short-term deposits that derive directly from its operations. The Company also enters into derivative transactions.
The Company is exposed to market risk, credit risk and liquidity risk. The Company''s senior management oversees the
management of these risks. The financial risk activities are governed by appropriate policies and procedures and that
financial risks are identified, measured and managed by the senior management in accordance with the Company''s policies
and risk objectives. All derivative activities for risk management purposes are carried out by professionals who have the
appropriate skills, experience and supervision. It is the Company''s policy that no trading in derivatives for speculative
purposes may be undertaken.
(A) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes
in market prices. Market risk comprises three types of risk: interest rate risk, foreign currency risk and other price
risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and
borrowings and derivative financial instruments.
The sensitivity analyses in the following sections relate to the position as at 31st March 2025 and 31st March 2024.
The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating
interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all
constant and on the basis of hedge designations in place at 31st March 2025.
The analyses exclude the impact of movements in market variables on: the carrying values of gratuity and other post¬
retirement obligations; provisions; and the non-financial assets.
The following assumptions have been made in calculating the sensitivity analyses:
The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This
is based on the financial assets and financial liabilities held at 31st March 2025 and 31st March 2024 including the
effect of hedge accounting.
(a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because
of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates
relates primarily to the Company''s short-term debt obligations with fixed & floating interest rates.
sensitivity Analysis of the Interest Rate
Profit or loss is sensitive to higher/lower interest expense from borrowings at the floating rate as a result of
change in interest rates.
The assumed movement in basis points for the interest rate sensitivity analysis is based on the currently
observable market environment, showing a significantly higher volatility than in prior years.
(b) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of
changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates
primarily to the Company''s operating activities (when revenue or expense is denominated in a foreign currency).
The prices of agricultural commodities are subject to fluctuations due to various factors. In the ordinary course of
business, the company is exposed to commodity price risk to the extent its open sales are not balanced by the
purchase contracts and inventory. The company has in place in a risk management policy to manage such risk by
hedging the sales by direct purchases of the commodity and strategic stocking policies.
(B) Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract,
leading to a financial loss. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of
creditworthiness as well as concentration of risks. Credit risk is controlled by analysing credit limits and creditworthiness''
of customers on a continuous basis to whom the credit has been granted after obtaining necessary approvals for
credit. The Company is exposed to credit risk to credit risk from its operating activities (primarily trade receivables)
and from its financing activity, including deposits with banks and financial institutions, foreign exchange transactions
and other financial instruments. .
(a) Trade receivables
Customer credit risk is managed as per the Company''s established policy, procedures and control relating to customer
credit risk management. Credit limits are set with approvals on the basis of the defined policies. Outstanding customer
receivables are regularly monitored and exposures are kept within the credit limits fixed for each customer.
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the
same geographical region, or have economic features that would cause their ability to meet contractual obligations
to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative
sensitivity of the Company''s performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Company''s policies and procedures include specific guidelines
to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and
managed accordingly.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large
number of minor receivables are grouped into homogenous company''s and assessed for impairment collectively.
The calculation is based on exchange losses historical data. The Company does not hold collateral as security. The
Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in
several jurisdictions and industries and operate in largely independent markets.
(b) Financial instruments and cash deposits
Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in
accordance with the Company''s policy. Investments of surplus funds are made only with approved counterparties
and within credit limits assigned to each counterparty.
The Company''s maximum exposure to credit risk for the components of the balance sheet at 31 March 2025 and
31 March 2024 is the carrying amounts as mentioned in Notes.
The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank
overdrafts, bank loans and lease liabilities. Approximately, 93% of the Company''s debt will mature in less than one
year at 31 March 2025 (31 March 2024: 26% Company''s debt will mature in less than one year) based on the carrying
value of borrowings reflected in the financial statements. The Company assessed the concentration of risk with
respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources
of funding and debt maturing within 12 months can be rolled over with existing lenders.
NOTE 44
CAPITAL MANAGEMENT
For the purpose of the Company''s capital management, capital includes issued equity capital and all other equity reserves
attributable to the equity holders of the parent. The primary objective of the Company''s capital management is to maximise
the shareholder value.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the
requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend
payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a
gearing ratio, which is net debt divided by fund attributable to Equity Shares Holders. The company includes within net
debt, interest bearing loans and borrowings less cash and short-term deposits and current investments.
In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it
meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements.
Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have
been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period.
No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March
2025 and 31 March 2024
NOTE 45
PERFORMANCE OBLIGATION ON REVENUE
In majority of the contracts performance obligation is satisfied âat a point in timeâ which is primarily determined on customer
obtaining the control of the asset.
Contract with the customer normally do not contain significant financing component and any advance payment received and
/or amount retained by customer is with intention of protecting either parties to the contract.
Variable consideration primarily consists of discounts, rebates, price concessions which are reduced from the transaction
price, if specified in the contract with customer/ based on customary business practices.
For revenue recognition in respect of performance obligation satisfied at a âpoint in timeâ the following criteria is used for
determining whether the customer has obtained âControl on assetâ
i. Transfer of significant risk and rewards
ii. Customer has legal right/title to the asset
iii. The entity has transferred the physical possession of the asset
iv. Customer has accepted the asset
v. Entity has the present right to payment for the asset
NOTE 46
CODE ON SOCIAL SECURITY, 2020
The implementation of the Code on Social Security, 2020 is getting postponed. The Company will assess the impact
thereof and give effect in the Financial Statements when the date of implementation of the codes and the Rules / Schemes
thereunder are notified.
NOTE 48
DIVIDENDS
Dividends paid during the year 2024-25 represent 50% final dividend for the financial year 2023-24 amounting to
Rs. 761.42 Lakhs and interim dividend of 30% declared in the financial year 2024-25 Rs.456.85 Lakhs.
The dividends declared by the Company are in Indian Rupees and are based on the profits available for distribution as
reported in the statutory financial statements of the Company. Subsequent to March 31, 2025, the Board of Directors of
Company have proposed a final dividend of Re. 0.40 per share (40%) in respect of financial year 2024-25. The proposal is
subject to the approval of shareholders at the Annual General Meeting, and if approved, would result in a cash outflow of
approximately Rs. 609.14 Lakhs. .
NOTE 49 : IMPAIRMENT OF ASSETS
Company has analysed indications of impairment of assets/financial instruments. On the basis of assessment of internal
and external factors, none of the assets/financial instruments has found indications of impairment of its assets/financial
instruments.
NOTE 50 : CONTINGENT ASSETS
Contingent assets are neither recognised nor disclosed in the financial statements..
NOTE 51 : OTHER Statutory Information
(a) The company has identified transactions with Struck-off companies by comparing company''s counter parties with
publicly available database of struck of companies through a manual name search. Based on such a manual search,
no party identified to be reported in the financial statements.
(b) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources
or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ)
with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party
identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any
party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in
other persons or entities identified by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee,
security or the like on behalf of the Ultimate Beneficiaries.
(c) The company has done registration of charges or satisfaction with ROC within the statutory period during the
year.
(d) Company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken
at the balance sheet date.
(e) The differences between the quarterly return of inventories and receivables submitted to the banks and the books
of account, did not affect the drawing power for the actual borrowing and the required security cover computed in
accordance with the sanctioned terms.
(f) Details of benami property held - No proceedings have been initiated on or are pending against the company for holding
benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.
(g) Wilful defaulter - The company has not been declared as wilful defaulter by any bank or financial institution or
government or any government authority.
(h) Compliance with number of layers of companies - The Company has complied with the number of layers prescribed
under the Companies Act, 2013.
(i) Compliance with approved scheme(s) of arrangements - The Company has not entered into any scheme of
arrangement which has an accounting impact on current or previous year.
(j) Undisclosed income -There is no income surrendered or disclosed as income during the current or previous year in
the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.
(k) Details of crypto currency or virtual currency - The Company has not traded or invested in crypto currency or virtual
currency during the current or previous year.
(l) Valuation of Property, Plant and Equipment - The Company has not revalued its property, plant and equipment
(including right-of-use assets) during the current or previous year .
NOTE 54
Figures for the previous periods have been regrouped / reclassified to conform to the classification of the current period.
See accompanying notes to the financial statements
As per our report of even date attached For and on behalf of the Board of Directors
FOR SURI & CO.,
Chartered Accountants
FRN : 004283S
G Rengarajan Ajit Thomas M M Venkatachalam
Partner Chairman Director
Membership No. 219922 DIN: 00018691 DIN: 00152619
Place: Chennai A. Ramadas P. Mahadevan
Date: 28 May 2025 Sr. Vice President & CFO Company Secretary
Mar 31, 2024
3.14 Provisions & contingent liability:
Provisions are recognized, when there is a present legal or constructive obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation, and when a reliable estimate of the amount of the obligation can be made. If the effect of the time value of money is material, the non - current provisions are discounted using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation and the unwinding of the discount is recognised as interest expense.
Contingent liabilities are recognized only when there is a possible obligation arising from past events, due to 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. Obligations are assessed on an ongoing basis and only those having a largely probable outflow of resources are provided for. The Company does not recognise contingent liability but discloses its existence in financial statements.
3.16 Dividends:
Final Dividends on shares are recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as liability on the date of declaration by the Company''s Board of Directors.
3.17 Segment Reporting:
The Company identifies operating segments based on the internal reporting provided to the chief operating decisionmaker.
The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions.
The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. The Company operates in a single segment namely solvent extracted products and geographically operates primarily in a single segment.
3.18 Research and Development:
Expenditure on research phase is recognised as an expense as and when it is incurred. Expenditure on development phase is recognized as intangible assets if it is identifiable, capable of being controlled and from which future economic benefits are expected to flow to the enterprise. Intangible assets are stated at cost net of tax / duty credits availed, if any, less accumulated amortisation and cumulative impairment.
Nature and purpose of other reserves
1 Capital Reserve - Reserve of capital nature taken to this head under the erstwhile GAAP.
2 General Reserve - General Reserve is created out of the profits earned by the Company by way of transfer from surplus in the statement of profit and loss. Mandatory transfer to general reserve is not required under the Companies Act 2013.
3 Retained Earnings: Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve, dividends or other distributions paid to shareholders.
4 Cash flow Hedging Reserve: The cash flow hedging reserve represents the cumulative effective portion of gains or losses arising on changes in fair value of designated portion of hedging instruments entered into for cash flow hedges. Such gains or losses will be reclassified to statement of profit and loss in the period in which the underlying hedged transaction occurs
Foot Note:
1. Term loan from banks
(i) Term Loan 1: The company had availed a term loan for a period of five years with half yearly instalments, last instalment repayment date is July 2024. Secured by first charge on 27.01 acres of leasehold land and movable fixed assets and buildings (value of buildings and movable fixed assets being Rs. 3,498 Lakhs). Rate of Interest - 9.70% p.a (31st March 2023 - 9.45% p.a.)
(ii) Term Loan 2: The company has taken an additional term loan for a period of six years including a moratorium of 1 year. The loan is repayable in 10 equal half yearly instalments with repayment commencing from February 2024 and the last instalment due being August 2028. Secured by first charge on assets created out of the term loan.Rate of Interest - 8.75% p.a. (31st March 2023 - 7.15% p.a)
Packing Credit from Banks (*)
Packing credit from banks secured by
- hypothecation of present and future current assets including stocks, semi-finished goods, finished goods, consumables, stores, spares, book debts.
- 15% margin on sight import letter of credit and performance guarantee
- In some cases second pari passu charge by way of hypothecation and mortgage of movable and immovable assets of the Company, second charge on entire fixed assets of the Company including EM, In some cases demand promissory note, hypothecation of book debts, letter of containing security, deposit of letter of credit
Period and amount of default as on 31st March 2024 - Nil (31st March 2023 - Nil)
No loans have been guaranteed by Directors or Others
RELATED PARTY TRANSACTIONS A: Details of related parties:
(a) Directors who held the office during the year:
Mr. Ajit Thomas, Chairman Mr. Habib Hussain Mr. M.A.Alagappan Mr. PShankar Mr. A.D.Bopana Mrs. Shanthi Thomas Mrs. Kavitha Vijay
(b) Key Management Personnel (KMP):
Mr. Balasundaram Krishnakumar, President and Manager Mr. A. Ramadas, Sr. Vice President and Chief Financial Officer Mr. Sharon Josh, Company Secretary
(c) Subsidiaries
AVT Natural Europe Limited, UK AVT Natural S.A. DE C.V, Mexico
AVT Natural North America Inc., USA (step down subsidiary)
AVT Natural FZCO, Dubai
Entities/Persons with whom transactions carried out / were carried in current / previous year
(d) Entities having significant influence over the reporting entity
The Midland Rubber and Produce Company Limited Neelamalai Agro Industries Limited
(e) Entities with common control through board composition / shareholding
AVT Gavia Foods Private Limited
The Nelliampathy Tea and Produce Company Limited
A V Thomas & Company Limited
Midland Corporate Advisory Services Private Limited
AVT McCormick Ingredients Private Limited
Midland Charitable Trust
AVT Leather Inc.
(f) Relatives of the directors
Mr. Rahul Thomas - Son of Mr. Ajit Thomas
Mr. Ashwin Thomas - Son of Mr. Ajit Thomas
Mrs. Shabri Roberson - Daughter of Mrs Shanthi Thomas
C. Fair value of Financial Instruments measured at amortised cost :
Due to the short-term nature of cash and cash equivalents and the short-term maturities of trade receivables, loans, borrowings-current, financial liabilities and assets the management considers that the carrying amount of assets and liabilities recognised at amortised cost in financial statements is approximate to their fair value.
The fair value of financial instruments as referred to in note (A) above has been classified into three categories depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities [Level 1 measurements] and lowest priority to unobservable inputs [Level 3 measurements].
D. Valuation inputs and relationship to fair value
There are no material level 3 fair value measurements in respect of the financial assets and liabilities of the company.
The Company''s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company''s operations and to provide guarantees to support its operations. The Company''s principal financial assets include loans, trade and other receivables, and cash and short-term deposits that derive directly from its operations. The Company also enters into derivative transactions.
The Company is exposed to market risk, credit risk and liquidity risk. The Company''s senior management oversees the management of these risks. The financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed by the senior management in accordance with the Company''s policies and risk objectives. All derivative activities for risk management purposes are carried out by professionals who have the appropriate skills, experience and supervision. It is the Company''s policy that no trading in derivatives for speculative purposes may be undertaken.
(A) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, foreign currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings and derivative financial instruments.
The sensitivity analyses in the following sections relate to the position as at 31 March 2024 and 31 March 2023.
The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all constant and on the basis of hedge designations in place at 31 March 2024.
The analyses exclude the impact of movements in market variables on: the carrying values of gratuity and other postretirement obligations; provisions; and the non-financial assets.
The following assumptions have been made in calculating the sensitivity analyses:
The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31 March 2024 and 31 March 2023 including the effect of hedge accounting.
(a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s short-term debt obligations with fixed & floating interest rates.
(c) Commodity price risk
The prices of agricultural commodities are subject to fluctuations due to various factors. In the ordinary course of business, the company is exposed to commodity price risk to the extent its open sales are not balanced by the purchase contracts and inventory. The company has in place in a risk management policy to manage such risk by hedging the sales by direct purchases of the commodity and strategic stocking policies.
(B) Credit risk
âCredit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Credit risk is controlled by analysing credit limits and creditworthiness'' of customers on a continuous basis to whom the credit has been granted after obtaining necessary approvals for credit. The Company is exposed to credit risk to credit risk from its operating activities (primarily trade receivables)
(a) Trade receivables
Customer credit risk is managed as per the Company''s established policy, procedures and control relating to customer credit risk management. Credit limits are set with approvals on the basis of the defined policies. Outstanding customer receivables are regularly monitored and exposures are kept within the credit limits fixed for each customer.
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Company''s performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Company''s policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.
(b) Financial instruments and cash deposits
Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty.
The Company''s maximum exposure to credit risk for the components of the balance sheet at 31 March 2020 and 31 March 2019 is the carrying amounts as mentioned in Notes.
(c) Liquidity risk
The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans and lease liabilities. Approximately, 26% of the Company''s debt will mature in less than one year at 31 March 2024 (31 March 2023: 29% Company''s debt will mature in less than one year) based on the carrying
For the purpose of the Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company''s capital management is to maximise the shareholder value.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by fund attributable to Equity Shares Holders. The company includes within net debt, interest bearing loans and borrowings less cash and short-term deposits and current investments.
PERFORMANCE OBLIGATION ON REVENUE
In majority of the contracts performance obligation is satisfied âat a point in timeâ which is primarily determined on customer obtaining the control of the asset.
Contract with the customer normally do not contain significant financing component and any advance payment received and /or amount retained by customer is with intention of protecting either parties to the contract.
Variable consideration primarily consists of discounts, rebates, price concessions which are reduced from the transaction price, if specified in the contract with customer/ based on customary business practices.
For revenue recognition in respect of performance obligation satisfied at a âpoint in timeâ the following criteria is used for determining whether the customer has obtained âControl on assetâ
i. Transfer of significant risk and rewards
ii. Customer has legal right/title to the asset
iii. The entity has transferred the physical possession of the asset
iv. Customer has accepted the asset
v. Entity has the present right to payment for the asset
NOTE 46
CODE ON SOCIAL SECURITY, 2020
The implementation of the Code on Social Security, 2020 is getting postponed. The Company will assess the impact thereof and give effect in the Financial Statements when the date of implementation of the codes and the Rules / Schemes thereunder are notified.
Company has analysed indications of impairment of assets/financial instruments. On the basis of assessment of internal
and external factors, none of the assets/financial instruments has found indications of impairment of its assets/financial
instruments.
NOTE 50 : CONTINGENT ASSETS
Contingent assets are neither recognised nor disclosed in the financial statements..
NOTE 51 : OTHER STATUTORY INFORMATION
(a) The company has identified transactions with Struck-off companies by comparing company''s counter parties with publicly available database of struck of companies through a manual name search. Based on such a manual search, no party identified to be reported in the financial statements.
(b) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(c) The company has done registration of charges or satisfaction with ROC within the statutory period during the year.
(d) Company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken at the balance sheet date.
(e) The differences between the quarterly return of inventories and receivables submitted to the banks and the books of account, did not affect the drawing power for the actual borrowing and the required security cover computed in accordance with the sanctioned terms.
(f) Details of benami property held - No proceedings have been initiated on or are pending against the company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.
(g) Wilful defaulter - The company has not been declared as wilful defaulter by any bank or financial institution or government or any government authority.
(h) Compliance with number of layers of companies - The Company has complied with the number of layers prescribed under the Companies Act, 2013.
(i) Compliance with approved scheme(s) of arrangements - The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.
(j) Undisclosed income -There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.
(k) Details of crypto currency or virtual currency - The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.
(l) Valuation of Property, Plant and Equipment - The Company has not revalued its property, plant and equipment
(including right-of-use assets) during the current or previous year .
Figures for the previous periods have been regrouped / reclassified to conform to the classification of the current period. See accompanying notes to the financial statements
As per our report of even date attached For and on behalf of the Board of Directors
For FOR SURI & CO.,
Chartered Accountants FRN : 004283S
G Rengarajan Ajit Thomas M.A. Alagappan
Partner Chairman Director
Membership No. 219922 DIN: 00018691 DIN: 00031805
Place: Chennai A. Ramadas Sharon Josh
Date :29th May 2024 Sr. Vice President & CFO Company Secretary
Mar 31, 2023
3.14 Provisions & contingent liability:
Provisions are recognized, when there is a present legal or constructive obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation, and when a reliable estimate of the amount of the obligation can be made. If the effect of the time value of money is material, the non - current provisions are discounted using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation and the unwinding of the discount is recognised as interest expense.
Contingent liabilities are recognized only when there is a possible obligation arising from past events, due to 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. Obligations are assessed on an ongoing basis and only those having a largely probable outflow of resources are provided for. The Company does not recognise contingent liability but discloses its existence in financial statements.
Contingent assets are disclosed in the Financial Statements by way of notes to accounts when a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or nonoccurrence of one or more uncertain future events not wholly within the control of the entity.
3.15 Cash flow statement:
Cash flows are reported using the indirect method, whereby, profit before tax is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows are segregated into operating, investing and financing activities.
3.16 Dividends:
Final Dividends on shares are recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as liability on the date of declaration by the Companyâs Board of Directors.
3.17 Segment Reporting:
The Company identifies operating segments based on the internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions. The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. The Company operates in a single segment namely solvent extracted products and geographically operates primarily in a single segment.
3.18 Research and Development:
Expenditure on research phase is recognised as an expense as and when it is incurred. Expenditure on development phase is recognized as intangible assets if it is identifiable, capable of being controlled and from which future economic benefits are expected to flow to the enterprise. Intangible assets are stated at cost net of tax / duty credits availed, if any, less accumulated amortisation and cumulative impairment.
Nature and purpose of other reserves
1 Capital Reserve: Reserve of capital nature taken to this head under the erstwhile GAAP.
2 General Reserve: General Reserve is created out of the profits earned by the Company by way of transfer from surplus in the
statement of profit and loss. Mandatory transfer to general reserve is not required under the Companies Act, 2013.
3 Retained Earnings: Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve,
dividends or other distributions paid to shareholders.
4 Cash flow Hedging Reserve: The cash flow hedging reserve represents the cumulative effective portion of gains or losses arising on changes in fair value of designated portion of hedging instruments entered into for cash flow hedges. Such gains or losses will be reclassified to statement of profit and loss in the period in which the underlying hedged transaction occurs.
Foot Note:
1. Term loan from banks
(i) Term Loan 1: The Company had availed a term loan for a period of five years with half yearly instalments, last instalment
repayment date is July 2024. Secured by first charge on 27.01 acres of leasehold land and movable fixed assets and buildings
(value of buildings and movable fixed assets being $ 3,498 Lakhs). Rate of Interest - 9.45% (31st March 2022 - 8.4% p.a.)
(ii) Term Loan 2: The Company has taken an additional term loan for a period of six years including a moratorium of 1 year. The loan is repayable in 10 equal half yearly instalments with repayment commencing from February 2024 and the last instalment due being August 2028. Secured by first charge on assets created out of the term loan.Rate of Interest - 7.15% p.a. (31st March 2022 - Nil).
Packing Credit from Banks (*)
Packing credit from banks secured by
- hypothecation of present and future current assets including stocks, semi-finished goods, finished goods, consumables, stores, spares, book debts.
- 15% margin on sight import letter of credit and performance guarantee
- In some cases second pari passu charge by way of hypothecation and mortgage of movable and immovable assets of the
Company, second charge on entire fixed assets of the Company including EM, In some cases demand promissory note, hypothecation of book debts, letter of containing security, deposit of letter of credit.
Period and amount of default as on 31st March 2023 - Nil (31st March 2022 - Nil)
No loans have been guaranteed by Directors or Others.
Exposure to Risks:
These plans typically expose the Company to actuarial risks such as: interest rate risk, longevity risk and salary risk.
Interest risk: A decrease in the Government Securities (G-Sec Bonds) interest rate will increase the plan liability.
Longevity risk: The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants during their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.
Salary risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan''s liability.
NOTE 36
RELATED PARTY TRANSACTIONS A: Details of related parties:
(a) Directors who held the office during the year:
Mr. Ajit Thomas, Chairman Mr. Habib Hussain Mr. M.A.Alagappan Mr. P.Shankar Mr. A.D.Bopana Mrs. Shanthi Thomas Mrs. Kavitha Vijay
(b) Key Management Personnel (KMP):
Mr. B. Krishna Kumar Sr. Vice President and Manager
Mr. A. Ramadas, Sr. Vice President and Chief Financial Officer
Mr. Sharon Josh, Company Secretary
(c) Subsidiaries
AVT Natural Europe Limited, UK (formerly known as ''AVT Tea Services Limited'') AVT Natural S.A. DE C.V
AVT Natural FZCO, Dubai - Formed on 28th March 2023 pending infusion of funds AVT Natural North America Inc., USA (step down subsidiary)
Entities / Persons with whom transactions carried out during the year
(d) Entities having significant influence over the reporting entity
The Midland Rubber and Produce Company Limited Neelamalai Agro Industries Limited
(e) Entities with common control through board composition / shareholding
AVT Gavia Foods Private Limited
The Nelliampathy Tea and Produce Company Limited
A V Thomas & Company Limited
Midland Corporate Advisory Services Private Limited
AVT McCormick Ingredients Private Limited
Midland Charitable Trust
AVT Leather Inc.
(f) Relatives of the directors
Mr. Rahul Thomas - Son of Mr. Ajit Thomas
Mr. Ashwin Thomas - Son of Mr. Ajit Thomas
Mrs. Shabri Roberson - Daughter of Mrs Shanthi Thomas
C. Fair value of Financial Instruments measured at amortised cost :
Due to the short-term nature of cash and cash equivalents and the short-term maturities of trade receivables, loans, borrowings-current, financial liabilities and assets the management considers that the carrying amount of assets and liabilities recognised at amortised cost in financial statements is approximate to their fair value.
The fair value of financial instruments as referred to in note (A) above has been classified into three categories depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities [Level 1 measurements] and lowest priority to unobservable inputs [Level 3 measurements].
D. Valuation inputs and relationship to fair value
There are no material level 3 fair value measurements in respect of the financial assets and liabilities of the Company.
NOTE 43
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company''s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company''s operations and to provide guarantees to support its operations. The Company''s principal financial assets include loans, trade and other receivables, and cash and short-term deposits that derive directly from its operations. The Company also enters into derivative transactions.
The Company is exposed to market risk, credit risk and liquidity risk. The Company''s senior management oversees the management of these risks. The financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed by the senior management in accordance with the Company''s policies and risk objectives. All derivative activities for risk management purposes are carried out by professionals who have the appropriate skills, experience and supervision. It is the Company''s policy that no trading in derivatives for speculative purposes may be undertaken.
(A) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, foreign currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings and derivative financial instruments.
The sensitivity analyses in the following sections relate to the position as at 31 March 2023 and 31 March 2022.
The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all constant and on the basis of hedge designations in place at 31 March 2023.
The analyses exclude the impact of movements in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions; and the non-financial assets.
The following assumptions have been made in calculating the sensitivity analyses:
The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31 March 2023 and 31 March 2022 including the effect of hedge accounting.
(a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s short-term debt obligations with fixed & floating interest rates.
(b) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities (when revenue or expense is denominated in a foreign currency).
(c) Commodity price risk
The prices of agricultural commodities are subject to fluctuations due to various factors. In the ordinary course of business, the company is exposed to commodity price risk to the extent its open sales are not balanced by the purchase contracts and inventory. The company has in place in a risk management policy to manage such risk by hedging the sales by direct purchases of the commodity and strategic stocking policies.
(B) Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Credit risk is controlled by analysing credit limits and creditworthiness'' of customers on a continuous basis to whom the credit has been granted after obtaining necessary approvals for credit. The Company is exposed to credit risk to credit risk from its operating activities (primarily trade receivables) and from its financing activity, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
(a) Trade receivables
Customer credit risk is managed as per the Company''s established policy, procedures and control relating to customer credit risk management. Credit limits are set with approvals on the basis of the defined policies. Outstanding customer receivables are regularly monitored and exposures are kept within the credit limits fixed for each customer.
(b) Financial instruments and cash deposits
Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty.
The Company''s maximum exposure to credit risk for the components of the balance sheet at 31 March 2023 and 31 March 2022 is the carrying amounts as mentioned in Notes.
(C) Liquidity risk
The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans and lease liabilities. Approximately, 29% of the Company''s debt will mature in less than one year at 31 March 2023 (31 March 2022: 32% Company''s debt will mature in less than one year) based on the carrying value of borrowings reflected in the financial statements. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of funding and debt maturing within 12 months can be rolled over with existing lenders.
NOTE 45
PERFORMANCE OBLIGATION ON REVENUE
In majority of the contracts performance obligation is satisfied "at a point in time" which is primarily determined on customer obtaining the control of the asset.
Contract with the customer normally do not contain significant financing component and any advance payment received and /or amount retained by customer is with intention of protecting either parties to the contract.
Variable consideration primarily consists of discounts, rebates, price concessions which are reduced from the transaction price, if specified in the contract with customer/ based on customary business practices.
For revenue recognition in respect of performance obligation satisfied at a "point in time" the following criteria is used for determining whether the customer has obtained "Control on asset"
i. Transfer of significant risk and rewards
ii. Customer has legal right/title to the asset
iii. The entity has transferred the physical possession of the asset
iv. Customer has accepted the asset
v. Entity has the present right to payment for the asset
NOTE 48 DIVIDENDS
Dividends paid during the year 2022-23 represent 60% final dividend for the financial year 2021-22 amounting to $ 9,13.70 Lakhs and interim dividend of 40% declared in the financial year 2022-23 $ 6,09.14 Lakhs.
The dividends declared by the Company are in Indian Rupees and are based on the profits available for distribution as reported in the statutory financial statements of the Company. Subsequent to March 31, 2023, the Board of Directors of Company have proposed a final dividend of $ 0.60 per share ( 60%) in respect of financial year 2022-23. The proposal is subject to the approval of shareholders at the Annual General Meeting, and if approved, would result in a cash outflow of approximately $ 9,13.70 Lakhs.
NOTE 49
IMPAIRMENT OF ASSETS
Company has analysed indications of impairment of assets. On the basis of assessment of internal and external factors, none of the assets has found indications of impairment of its assets.
NOTE 50
CONTINGENT ASSETS
Contingent assets are neither recognised nor disclosed in the financial statements.
NOTE 51
OTHER STATUTORY INFORMATION
(a) The Company has identified transactions with Struck-off companies by comparing company''s counter parties with publicly available database of struck of companies through a manual name search. Based on such a manual search, no party identified to be reported in the financial statements.
(b) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(c) The Company has done registration of charges or satisfaction with ROC within the statutory period during the year.
(d) Company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken at the balance sheet date.
(e) The differences between the quarterly return of inventories and receivables submitted to the banks and the books of account, did not affect the drawing power for the actual borrowing and the required security cover computed in accordance with the sanctioned terms.
(f) Details of benami property held - No proceedings have been initiated on or are pending against the company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.
(g) Wilful defaulter - The company has not been declared as wilful defaulter by any bank or financial institution or government or any government authority.
(h) Compliance with number of layers of companies - The Company has complied with the number of layers prescribed under the Companies Act, 2013.
(i) Compliance with approved scheme(s) of arrangements - The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.
(j) Undisclosed income -There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.
(k) Details of crypto currency or virtual currency - The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.
(l) Valuation of Property, Plant and Equipment - The Company has not revalued its property, plant and equipment (including right-of-use assets) during the current or previous year.
For Suri & Co Chartered Accountants FRN : 004283S
G Rengarajan
Partner Ajit Thomas M.A. Alagappan
Membership No. 219922 Chairman Director
DIN: 00018691 DIN: 00031805
UDIN: .23219922BGWKHB1062
Date : 30th May 2023 A. Ramadas Sharon Josh
Place : Chennai Sr. Vice President & CFO Company Secretary
Ajit Thomas M.A. Alagappan
Chairman Director
Date : 30th May 2023 A. Ramadas Sharon Josh
Place : Chennai Sr. Vice president & CFO Company Secretary
Mar 31, 2018
1. General information
AVT Natural Products Limited is engaged in the production, trading and distribution of Oleoresins and value added Teas. The Company has its production facilities in India and exports most of its products.
The Company is a Public Limited Company incorporated and domiciled in India and has its registered office at 60, Rukmani Lakshmipathy Salai, Egmore, Chennai - 600008. The company has its listings on the Bombay Stock Exchange and National Stock Exchange in India. The standalone financial statements for the year ended March 31st, 2018 were approved by the Board of Directors and authorised for issue on May 29, 2018.
C. Terms/ rights attached to equity shares
The company has one class of equity shares having a par value of Re. 1 per share. Each shareholder is eligible for one vote share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of Interim Dividend. In the event of the liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to the shareholding.
F. Shares Allotted as fully paid up by way of Bonus Shares (During 5 years preceding March 31st 2018)
The Company allotted 7,61,42,000 Equity Shares as Fully Paid up Bonus Shares in the ratio of 1:1 by capitalisation of Capital Redemption Reserve and General Reserve on 28th September 2013 pursuant to Shareholders resolution passed by postal ballot on 19th September 2013.
The estimate of future salary increases, considered in actuarial valuation, takes into account inflation, seniority, promotions and other relevant factors. The above information has been certified by the actuary and has been relied upon by the Auditors.
Exposure to Risks:
These plans typically expose the Company to actuarial risks such as: interest rate risk, longevity risk and salary risk.
Interest risk: A decrease in the Government Securities (G-Sec Bonds) interest rate will increase the plan liability.
Longevity risk: The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants during their employment. An increase in the life expectancy of the plan participants will increase the planâs liability.
Salary risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the planâs liability.
NOTE - 2 GUARANTEE GIVEN BY THE COMPANY
Bank Guarantees of Rs. 39.52 lakhs (PY - Rs. 17.52 lakhs) have been given by the company to various government authorities & other parties. These guarantees were issued against the margin money kept with bank of Rs. 14.86 lakhs (PY Rs. 14.86 lakhs) made with the bank.
Transition to Ind AS
In preparing its opening Ind AS balance sheet, the Company has adjusted, regrouped and reclassified the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP). The exemptions and exceptions applied by the Company in accordance with Ind AS 101 âFirst-time Adoption of Indian Accounting Standardsâ along with the reconciliations of equity, total comprehensive income, balance sheet and cash flows in accordance with Previous GAAP to Ind AS are explained below.
Exemptions from retrospective application:
The Company has applied the following exemptions:
a. Property, plant and equipment â Deemed Cost
Ind AS 101 permits a first time adoption to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. Accordingly, the Company has elected to measure all of its property, plant and equipment at the carrying value, based on Indian GAAP.
b. Measurement of financial assets and financial liabilities at amortised cost: Under Previous GAAP, all assets and liabilities that are now classified under the head financial assets and financial liabilities were carried at cost. Under Ind AS, however, certain financial assets and financial liabilities are subsequently measured at Fair Value which involves use of Fair Value Measurement hierarchy at the date of transition to Ind AS.
c. Fair valuation of Investments in Mutual Fund (fair value through profit and loss account): Under the Previous GAAP, short term investments were measured at cost less diminution in value. Under the Ind AS, investments in mutual fund are measured at fair value as at the transition date, the Company has made irrevocable choice to account for these investments at fair value through Profit & Loss (FVPL).
d. Deferred Tax: Under Ind AS, Deferred tax has been recalculated in respect of above changes and the deferred tax impact as at the transition date has been recognised in opening reserves and for the year ended March 31st, 2017.
e. Proposed Dividend: Under the Previous GAAP, dividends on equity shares recommended by the Board of Directors after the end of the reporting period but before the financial statements were approved for issue were recognised as a provision in the financial statements. However, under Ind AS, such dividends are recognized when declared by shareholders in the annual general meeting.
f. Figures under previous GAAP have been regrouped/reclassified where ever required.
g Actuarial gain/ loss on defined benefit plans: Under Ind AS, re-measurements i.e. actuarial gain and losses and the return on plan assets, excluding amounts included in the net interest expenses on the net defined benefit liabilities are recognised in the other comprehensive income instead of Profit & Loss under previous GAAP as there re-measurements were forming part of the profit & loss for the year. There is no impact on the total equity.
h. Cash Flow Hedge considered as a direct credit to reserves in IGAAP has been routed through OCI under Ind AS accounting.
a. Actuarial gain/ loss on defined benefit plans: Under Ind AS, re-measurements i.e. actuarial gain and losses and the return on plan assets, excluding amounts included in the net interest expenses on the net defined benefit liabilities are recognised in the other comprehensive income instead of Profit & Loss under previous GAAP, all these re-measurements were forming part of the profit & loss for the year. There is no impact on the total equity.
b. Revenue from Operations: Under Previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty and the excise duty paid is presented on the face of statement of profit and loss as part of expenses.
c. Under Ind AS, forex gains have been regrouped under Other Income from Revenue from Operations. Similarly, bank charges in the nature of finance cost have been grouped under finance costs and own consumption of wind power has been adjusted to costs.
d. Current investments in the nature of mutual funds have been fair valued and the gains have been considered in the profit & loss account under Other Income.
e. Cash Flow Hedge considered as a direct credit to reserves in IGAAP has been routed through OCI under Ind AS accounting.
f. The tax effect on a, c, d and e have been adjusted against profit & loss / OCI as the case may be. g Figures under previous GAAP have been regrouped/reclassified where ever required.
NOTE 3
FAIR VALUE MEASUREMENT
Financial Instruments by category
The significant accounting policies, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset, financial liability and equity instrument are disclosed.
B.2 Valuation inputs and relationship to fair value
The fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date. In respect of the investment in equity share, considering the nature of the investment, fair value is considered close to the carrying value by the management
C. Fair value of Financial Instruments measured at amortised cost:
Due to the short-term nature of cash and cash equivalents and the short-term maturities of trade receivables, loans, liabilities, borrowings, other liabilities and assets the management considers that the carrying amount of assets and liabilities recognised at amortised cost in financial statements is approximate to their fair value.
The fair value of financial instruments as referred to in note (A) above has been classified into three categories depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities [Level 1 measurements] and lowest priority to unobservable inputs [Level 3 measurements].
D. Valuation inputs and relationship to fair value
There are no material level 3 fair value measurements in respect of the financial assets and liabilities of the company.
NOTE - 4: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Companyâs principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Companyâs operations and to provide guarantees to support its operations. The Companyâs principal financial assets include loans, trade and other receivables, and cash and short-term deposits that derive directly from its operations. The Company also enters into derivative transactions.
The Company is exposed to market risk, credit risk and liquidity risk. The Companyâs senior management oversees the management of these risks. The financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed by the senior management in accordance with the Companyâs policies and risk objectives. All derivative activities for risk management purposes are carried out by professionals who have the appropriate skills, experience and supervision. It is the Companyâs policy that no trading in derivatives for speculative purposes may be undertaken.
(A) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, foreign currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings and derivative financial instruments.
The sensitivity analyses in the following sections relate to the position as at 31st March 2018 and 31st March 2017.
The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all constant and on the basis of hedge designations in place at 31st March 2018.
The analyses exclude the impact of movements in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions; and the non-financial assets.
The following assumptions have been made in calculating the sensitivity analyses:
- The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31st March 2018 and 31st March 2017 including the effect of hedge accounting.
(a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companyâs exposure to the risk of changes in market interest rates relates primarily to the Companyâs short-term debt obligations with fixed & floating interest rates.
The assumed movement in basis points for the interest rate sensitivity analysis is based on the currently observable market environment, showing a significantly higher volatility than in prior years.
(b) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Companyâs exposure to the risk of changes in foreign exchange rates relates primarily to the Companyâs operating activities (when revenue or expense is denominated in a foreign currency).
The Company manages its foreign currency risk by using foreign currency forward contracts.
When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions, the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable or payable that is denominated in the foreign currency.
(2) Foreign currency sensitivity
The following tables demonstrate the sensitivity to a reasonably possible change in USD, GBP & SGD exchange rates, with all other variables held constant. The impact on the Companyâs profit before tax is due to changes in the fair value of monetary assets and liabilities including non-designated foreign currency derivatives. The impact on the Companyâs pre-tax equity is due to changes in the fair value of forward exchange contracts designated as cash flow hedges. The Companyâs exposure to foreign currency changes for all other currencies is not material.
(c) Commodity price risk
The prices of agricultural commodities are subject to fluctuations due to various factors. In the ordinary course of business, the company is exposed to commodity price risk to the extent its open sales are not balanced by the purchase contracts and inventory. The company has in place in a risk management policy to manage such risk by hedging the sales by direct purchases of the commodity and strategic stocking policies.
(B) Credit risk
Credit risk is the risk that a 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 receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
(a) Trade receivables
Customer credit risk is managed as per the Companyâs established policy, procedures and control relating to customer credit risk management. Credit limits are set with approvals on the basis of the defined policies. Outstanding customer receivables are regularly monitored and exposures are kept within the credit limits fixed for each customer.
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Companyâs performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Companyâs policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous companyâs and assessed for impairment collectively. The calculation is based on exchange losses historical data. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets.
(b) Financial instruments and cash deposits
Credit risk from balances with banks and financial institutions is managed by the Companyâs treasury department in accordance with the Companyâs policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty.
The Companyâs maximum exposure to credit risk for the components of the balance sheet at 31st March 2018 and 31st March 2017 is the carrying amounts as mentioned in Notes.
(C) Liquidity risk
The Companyâs objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts and bank loans. Approximately, 100% of the Companyâs debt will mature in less than one year at 31st March 2018 (31st March 2017: NIL) based on the carryingvalue of borrowings reflected in the financial statements. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of funding and debt maturing within 12 months can be rolled over with existing lenders.
NOTE - 5 CAPITAL MANAGEMENT
For the purpose of the Companyâs capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Companyâs capital management is to maximise the shareholder value.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by fund attributable to Equity Sharesholders. The company includes within net debt, interest bearing loans and borrowings less cash and short-term deposits, excluding discontinued operations.
No changes were made in the objectives, policies or processes for managing capital during the years ended 31st March 2018 and 31st March 2017.
NOTE â 6 DIVIDENDS
Dividends paid during the year 2017-18 represent 20% final dividend for the financial year 2016-17 (Rs.366.57 lakhs inclusive of DDT) and interim dividend of 20% declared in the financial year 2017-18 (Rs.366.57 lakhs inclusive of DDT).
The dividends declared by the Company are in Indian Rupees and are based on the profits available for distribution as reported in the statutory financial statements. Subsequent to March 31st, 2018, the Board of Directors of the Company have proposed a final dividend of Rs. 0.20 per share (20 percent) for the financial year 2017-18. The proposal is subject to the approval of shareholders at the Annual General Meeting, and if approved, would result in a cash outflow of approximately Rs. 366.57 lakhs, inclusive of corporate dividend tax of Rs. 62.00 lakhs.
Mar 31, 2017
E) SHARES ALLOTTED AS FULLY PAID UP BY WAY OF BONUS SHARES (DURING 5 YEARS PRECEDING MARCH 31, 2017)
The Company allotted 7,61,42,000 Equity Shares as Fully Paid up Bonus Shares in the ratio of 1:1 by capitalization of Capital Redemption Reserve and General Reserve on 28th September 2013 pursuant to Share Holders Resolution passed by postal ballot on 19th September 2013. .
The company has a process where by periodically all foreign exchange forward contracts are assessed. At the year end, the company has reviewed the forward exchange contracts and there are no material foreseeable losses on such contracts.
The Company has adopted the provisions mentioned in the guidance note issued by ICAI with respect to Hedge Accounting insofar as it relates to Forward contracts that are in the essence derivative instruments entered into by the Company to hedge foreign currency risk on firm commitments and highly probable forecast transactions meeting the necessary criteria for designation as âCash Flow Hedgeâ. The gains and losses on effective cash flow hedges are recognized in âHedge Reserve Accountâ and retained until the underlying forecasted transaction occurs.
1 As per Section 135 of the Companies, Act 2013, a CSR committee has been formed by the company. The areas for CSR activities are promoting education, health care, development of sports, sanitation, women empowerment and rural development projects. The total amount spent during the year on such activities which are specified in Schedule VII of the Companies Act, 2013 amounts to Rs. 83,26,799/- ( PY Rs.95,87,482/- )
2 Disclosure on Specified Bank Notes ( SBNs )
During the year, the company had specified bank notes or other denomination note as defined in the MCA notification GSR 308E dated 31st March 2017 on the details of Specified Bank Notes ( SBNs ) held and transacted during the period 8th November 2016 to 30 th December 2016, the denomination wise SBNs and other notes as per the said notification is given below:
* For the purpose of this clause, the term âSpecified Bank Notesâ shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs No. SO 340E dated 8th November 2016.
3 Due to Micro & Small Enterprises:
Based on the information available with the company, the principal amount due to Micro, Small & Medium Enterprises as on 31.03.2017 is Rs. 2,60,31,494/- ( PY Rs. 4,83,789/-). There are no overdue principal amounts and therefore no interest was paid or payable.
4 Segment Reporting :
The Company operates in solvent extracted products which is the primary reportable segment. Therefore, segment reporting is not applicable.
5 Dividends :
The Board of Directors, in its meeting on 29th May 2017, proposed a Final Dividend of Rs 0.20 Per equity share for the Financial Year ended March 31, 2017. The proposal is subject to the approval of Share Holders at the Annual General Meeting to be held on 10th August 2017 and if approved would result in a cash outflow of Approximately Rs 366.57 lakhs including Corporate Dividend Tax.
In terms of revised Accounting Standard (AS) 4 Contingencies and Events occurring after Balance Sheet date as notified by the Ministry of Corporate Affairs (MCA) through amendments to Companies (Accounting Standard) Amendment Rules 2016, dated 30th March, 2016, proposed dividend is not recognized as liability as on 31st March, 2017. Accordingly balance of Reserves and Surplus is higher by Rs 366.57 lakh and balance of other liabilities is lower by an equivalent amount.
6 Research and Development Expenditure :
Expenditure incurred at R&D Centres approved by Department of Scientific and Industrial Research (DSIR) eligible for Weighted deduction under the Income Tax Act
7 Employee Benefits:
i) Defined Benefit Plans:
a) Description of the Companyâs defined benefit plan:
i) Gratuity Scheme:
This is a funded defined benefit plan for qualifying employees for which, the Company makes contribution to the Gratuity Fund managed by the Life Insurance Corporation of India. The scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service.
ii) Leave Encashment:
The company also operates a non funded leave encashment scheme for its employees.
b) Reconciliation of changes in the Present Value of Obligation:
ii) Defined Contribution Plans:
The Company makes contribution towards employeesâ provident fund, family pension fund, superannuation fund and employeesâ state insurance scheme. Under the rules of these schemes, the Company is required to contribute a specified percentage of payroll costs. The Company during the year recognized Rs. 2,20,63,459/- as expense towards contributions to these plans.
8 Related Party Transactions :
Following companies are related to the Company on account of Common Control through Constitution of Board/ Shareholdings:
- A V Thomas & Company Ltd.
- L J International Ltd.
- A V Thomas Investments Company Ltd.
- The Nelliampathy Tea & Produce Co. Ltd.
- Neelamalai Agro Industries Ltd.
- The Midland Rubber and Produce Company Ltd.
- AVT McCormick Ingredients Private Ltd.
- AVT Tea Services Ltd.
- AVT Holdings Private Ltd.
- A V Thomas Leather & Allied Products Pvt. Ltd.
Key Management Personnel:
Mr. Ajit Thomas, Chairman
- AVT Tea Services North America, LLC
- A V Thomas Exports Ltd.
- Midland Latex Products Ltd.
- Sermatech Private Ltd.
- Aspera Logistics Pvt. Ltd.
- Midland Corporate Advisory Services Pvt. Ltd.
- AVT Gavia Foods Pvt. Ltd.
- Midland Charitable Trust
- AVT International Ltd.
Mr. M.N. Satheesh Kumar, President and CEO
Mr. A. Ramadas, Sr. Vice President and CFO
Mr. Dileepraj. P, Company Secretary
9 Previous yearâs figures have been regrouped wherever necessary to conform to Current yearâs classification
Mar 31, 2015
A) Transactions of a non-cash nature.
b) Any deferrals or accruals of past or future operating cash receipts
or payments and
c) Items of income or expense associated with investing or financing
cash flows.
Cash and cash equivalents (including bank balances) are reflected as
such in Cash Flow Statement.
E) SHARES ALLOTTED AS FULLY PAID UP BY WAY OF BONUS SHARES (DURING 5
YEARS PRECEDING MARCH 31,2015)
The Company allotted 7,61,42,000 Equity Shares as Fully Paid up Bonus
Shares in the ratio of 1:1 by capitalisation of Capital Redemption
Reserve and General Reserve on 28th September 2013 pursuant to Share
Holders Resolution passed by postal ballot on 19th September 2013.
The Company has a process where by periodically all foreign exchange
forward contracts are assessed. At the year end, the Company has
reviewed the forward exchange contracts and there are no material
forseeable losses on such contracts.
2 The Company has adopted the useful life of fixed assets prescribed
under Part C of Schedule II of the Companies Act 2013 for providing
depreciation from 1st April 2014 except in the case of Plant and
Machinery relating to Continuous Processing Plant of Marigold and
Spices Processing for which the useful life has been taken as per the
technical evaluation. As a result the standalone depreciation for the
year ended 31.03.2015 is higher by Rs.47,72,830/- with consequential
effect on statement of profit and loss before tax by this amount. For
the tangible Fixed Assets that had completed useful life as at
01.04.2014, the carrying amount of Rs. 43,86,007/- has been charged to
Statement of Profit & Loss as per Note 7 of Part C of Schedule II to
the Companies Act 2013.
3 As per Section 135 of the Companies Act 2013, a CSR committee has
been formed by the Company. The areas for CSR activities are promoting
education, health care, sanitation, women empowerment and rural
development projects. The total amount spent during the year on such
activities which are specified in Schedule VII of the Companies Act
2013 amounts to Rs.15,00,512/-
4 Due to Micro & Small Enterprises:
Based on the information available with the Company, the principal
amount due to Micro, Small & Medium Enterprises as on 31.03.2015 is Rs.
Nil (Previous Year Nil). There are no overdue principal amounts and
therefore no interest was paid or payable.
5 Segment Reporting :
The Company operates in solvent extracted products which is the
primary reportable segment. Therefore, segment reporting is not
applicable.
6 Employee Benefits:
i) Defined Benefit Plans:
a) Description of the Company's defined benefit plan:
i) Gratuity Scheme:
This is a funded defined benefit plan for qualifying employees for
which, the Company makes contribution to the Gratuity Fund managed by
the Life Insurance Corporation of India. The scheme provides for a
lumpsum payment to vested employees at retirement, death while in
employment or on termination of employment. Vesting occurs upon
completion of five years of service.
ii) Leave Encashment:
The Company also operates a non funded leave encashment scheme for its
employees.
ii) Defined Contribution Plans:
The Company makes contribution towards employees' provident fund,
family pension fund, super annuation fund and employees' state
insurance scheme. Under the rules of these schemes, the Company is
required to contribute a specified percentage of payroll costs. The
Company during the year recognised Rs. 2,26,03,725/- as expense towards
contributions to these plans.
7 Related Party Transactions :
Following companies are related to the Company on account of Common
Control through Constitution of Board/ Shareholdings:
- A V Thomas & Company Ltd - A V Thomas Leather & Allied Products Pvt.
Ltd
- LJ International Ltd - AVT Tea Services North America, LLC
- A V Thomas Investments Company Ltd - A V Thomas Exports Ltd
- The Nelliampathy Tea & Produce Co. Ltd - Midland Latex Products Ltd
- Neelamalai Agro Industries Ltd - Sermatech Private Ltd
- The Midland Rubber and Produce Company Ltd - Ajit Thomas Holdings
Private Limited
- AVT McCormick Ingredients Private Ltd - Midland Corporate Advisory
Services P Ltd
- AVT Natural Pte Ltd. - AVT Gavia Foods Pvt Ltd
- AVT Tea Services Ltd - Midland Charitable Trust
- Teleflex Medical Private Ltd - Midland Natural Pte. Ltd
- AVT Holdings Private Ltd - AVT International Ltd.
8 Previous year's figures have been regrouped wherever necessary to
conform to Current year's classification.
Mar 31, 2013
1 The Company has opted for accounting the exchange differences
arising on reporting of long term foreign currency monetary items in
line with Companies (Accounting Standards) Amendment Rules, 2009 on
Accounting Standard 11 (AS-11) notified by the Government of India on
29th December 2011. Accordingly, the effect of exchange differences on
foreign currency term loan availed for acquisition of fixed assets has
been adjusted to the cost of fixed assets and depreciation has been
provided over the balance life of assets. The unamortised amount as on
31.03.2013 on account of the above is Rs. 0.76 Crores.
2 Employee Benefits:
i) Defined Benefit Plans:
a) Description of the Company''s defined benefit plan:
i) Gratuity Scheme:
This is a funded defined benefit plan for qualifying employees for
which, the Company makes contribution to the Gratuity Fund managed by
the Life Insurance Corporation of India. The scheme provides for a
lumpsum payment to vested employees at retirement, death while in
employment or on termination of employment. Vesting occurs upon
completion of five years of service.
ii) Leave Encashment:
The company also operates a non funded leave encashment scheme for its
employees.
Mar 31, 2012
Year ended Year ended
31.03.2012 31.03.2011
Rs. Rs.
1 CONTINGENT LIABILITIES IN RESPECT OF
a) Sales tax demand disputed in appeals,
against which Rs.71,23,260/- paid and
included under Advances 1,51,46,028 1,51,46,028
b) Service Tax demand disputed in appeal 5,41,50,000 5,41,50,000
c) The company through its banker State
Bank of India, Palarivattom Branch has
given a Letter of Comfort to State Bank
of India, Shanghai, China for Working
Capital Facility of US$ 1.5 Million
(Rs.750 Lacs) to the Ultimate Subsidiary
Heilongjiang AVT-Bio Products Ltd, China 7,50,00,000 Nil
2 The Company has certain unexpired foreign currency derivative
contracts to the tune of US $ 4.8 Million as on 31.03.2012, which were
entered into to hedge the risk of changes in foreign exchange currency
rates on future export sales against existing long term export
contracts. The mark to market negative variation on currency position
as on 31.03.2012 of Rs.3.37 crores has not been considered as loss on
foreign currency derivates. As the hedge transactions have been entered
into based on firm export sale contracts and as per the costing systems
of the company, such hedge transaction will only result in current
profit for the relevant period of execution of the contract. On the
principle of going concern, such hedge transactions will not result in
losses requiring recognition as on this date.
3 The Company has opted for accounting the exchange differences
arising on reporting of long term foreign currency monetary items in
line with Companies (Accounting Standards) Amendment Rules, 2009 on
Accounting Standard 11 (AS-11) notified by the Government of India on
29th December 2011. Accordingly, the effect of exchange differences on
foreign currency term loan availed for acquisition of fixed assets has
been adjusted to the cost of fixed assets and depreciation has been
provided over the balance life of assets. The unamortised amount as on
31.03.2012 on account of the above is Rs. 0.64 Crores.
4 Segment Reporting :
The Company operates in solvent extracted products which is the primary
reportable segment. Therefore, segment reporting is not applicable.
5 Employee Benefits:
i) Defined Benefit Plans:
a) Description of the Company's defined benefit plan:
i) Gratuity Scheme:
This is a funded defined benefit plan for qualifying employees for
which, the Company makes contribution to the Gratuity Fund managed by
the Life Insurance Corporation of India. The scheme provides for a
lumpsum payment to vested employees at retirement, death while in
employment or on termination of employment. Vesting occurs upon
completion of five years of service.
ii) Leave Encashment:
The company also operates a non funded leave encashment scheme for its
employees.
ii) Defined Contribution Plans:
The Company makes contribution towards employees' provident fund,
family pension fund, super annuation fund and employees' state
insurance scheme. Under the rules of these schemes, the Company is
required to contribute a specified percentage of payroll costs. The
Company during the year recognised Rs. 97,41,489/- as expense towards
contributions to these plans.
6 Previous year's figures have been regrouped wherever necessary to
conform to Current year's classification.
Mar 31, 2011
Year Ended Year Ended
31.03.2011 31.03.2010
Rs. Rs.
1 CONTINGENT LIABILITIES IN RESPECT OF
a) Salestax demand disputed in appeals,
against which Rs.71,23,260/- paid and
included under Advances 1,51,46,028 1,52,86,216
b) Service Tax demand disputed in
appeal 5,41,50,000 4,30,81,160
c) Outstanding Bank Guarantees/Letters
of Credit 3,87,63,541 9,66,83,981
2 The Company has certain unexpired foreign currency derivative
contracts to the tune of US $ 9.6 Million as on 31.03.2011, which were
entered into to hedge the risk of changes in foreign exchange currency
rates on future export sales against existing long term export
contracts. The mark to market negative variation on currency position
as on 31.03.2011 of Rs.1.12 crores has not been considered as loss on
foreign currency derivates. As the hedge transactions have been entered
into based on firm export sale contracts and as per the costing systems
of the company, such hedge transaction will only result in current
profit for the relevant period of execution of the contract. On the
principle of going concern, such hedge transactions will not result in
losses requiring recognition as on this date.
3 The Company has opted for accounting the exchange differences
arising on reporting of long term foreign currency monetary items in
line with Companies (Accounting Standards) Amendment Rules, 2009 on
Accounting Standard 11 (AS-11) notified by the Government of India on
31st March 2009. Accordingly, the effect of exchange differences on
foreign currency term loan availed for acquisition of fixed assets has
been adjusted to the cost of fixed assets and depreciation has been
provided over the balance life of assets. The unamortized amount as on
31.03.2011 on account of the above is Rs. 0.24 Crores.
4 Due to Micro & Small Enterprises:
Based on the information available with the company, the principal
amount due to Micro , Small & Medium Enterprises as on 31.03.2011 is
Rs.Nil. There are no overdue principal amounts and therefore no
interest was paid or payable.
5 Employee Benefits:
i) Defined Benefit Plans:
a) Description of the Company's defined benefit plan: i) Gratuity
Scheme:
This is a funded defined benefit plan for qualifying employees for
which, the Company makes contribution to the Gratuity Fund managed by
the Life Insurance Corporation of India. The scheme provides for a
lumpsum payment to vested employees at retirement, death while in
employment or on termination of employment. Vesting occurs upon
completion of five years of service.
ii) Leave Encashment:
The company also operates a non funded leave encashment scheme for its
employees.
ii) Defined Contribution Plans:
The Company makes contribution towards employees' provident fund,
family pension fund, super annuation fund and employees' state
insurance scheme. Under the rules of these schemes, the Company is
required to contribute a specified percentage of payroll costs. The
Company during the year recognised Rs. 98,33,873/- as expense towards
contributions to these plans.
6 Related Party Transactions:
Following associate companies are related to the company on account of
Common Control through Constitution of Board/Shareholdings:
- A V Thomas & Company Ltd - A V Thomas Leather (UK) Ltd
- LJ International Ltd - A V Thomas Exports Ltd
- A V Thomas Investments Company - Midland Latex Products Ltd
Ltd
- The Nelliampathy Tea & Produce - Sermatech Private Ltd
Co. Ltd
- Neelamalai Agro Industries Ltd - Ajit Thomas Holdings Private
Limited
- The Midland Rubber and Produce - Midland Corporate Advisory
Company Limited Services Pvt. Ltd
- AVT McCormick Ingredients - AVT Gavia Foods Pvt. Ltd
Company Limited
- AVT Natural Pte Ltd. - Midland Charitable Trust
- Heilongjiang AVT Bio-Products - Mdland Natural Pte. Ltd.
Ltd.
- Tele flex Medical Private Ltd
- AVT Infotech Private Ltd
- A V Thomas Leather & Allied Products Pvt.Ltd
Key Management Personnel : Mr. Ajit Thomas, Chairman
Mr. M.S.A. Kumar, Managing
Director
Mar 31, 2010
1 CONTINGENT LIABILITIES IN RESPECT OF
a) Salestax demand disputed in
appeals, against which Rs.71,40,702
paid and included under Advances 1,52,86,216 1,52,86,216
b) Service Tax demand disputed in appeal 4,30,81,160 Nil
c) Outstanding Bank Guarantees/Letters
of Credit 9,66,83,981 1,35,75,067
d) Capital Commitments not provided for
(net of advances) Nil 1,73,77,130
2 The Company has certain unexpired foreign currency derivative
contracts to the tune of US $ 14.4 Million as on 31.03.2010, which were
entered into to hedge the risk of changes in foreign exchange currency
rates on future export sales against existing long term export
contracts.The mark to market negative variation on currency position as
on 31.03.2010 of Rs. 2.28 crores has not been considered as loss on
foreign currency derivates. As the hedge transactions have been entered
into based on firm export sale contracts and as per the costing systems
of the company, such hedge transaction will only result in current
profit for the relevant period of execution of the contract.On the
principle of going concern, such hedge transactions will not result in
losses requiring recognition as on this date.
3 The Company has opted for accounting the exchange differences
arising on reporting of long term foreign currency monetary items in
line with Companies (Accounting Standards) Amendment Rules, 2009 on
Accounting Standard 11 (AS-11) notified by the Government of India on
31st March 2009. Accordingly, the effect of exchange differences on
foreign currency term loan availed for acquisition of fixed assets has
been adjusted to the cost of fixed assets and depreciation has been
provided over over the balance life of assets. The unamortised amount
as on 31.03.2010 on account of the above is Rs.0.18 Crores.
4 Due to Micro & Small Enterprises:
Based on the information available with the company, the principal
amount due to Micro , Small & Medium Enterprises as on 31.03.2010 is
Rs.Nil. There are no overdue principal amounts and therefore no
interest was paid or payable.
5 Employee Benefits:
i) Defined Benefit Plans:
a) Description of the Companys defined benefit plan: i) Gratuity
Scheme:
This is a funded defined benefit plan for qualifying employees for
which, the Company makes contribution to the Gratuity Fund managed by
the Life Insurance Corporation of India. The scheme provides for a
lumpsum payment to vested employees at retirement, death while in
employment or on termination of employment. Vesting occurs upon
completion of five years of service.
ii) Leave Encashment:
The company also operates a non funded leave encashment scheme for its
employees.
b) Reconciliation of changes in the Present Value of Obligation:
6 Related Party Transactions :
Following associate companies are related to the company on account of
Common Control through Constitution of Board/Shareholdings:
- A V Thomas & Company Ltd - A V Thomas Leather & Allied Products
Pvt.Ltd
- A V Thomas International Ltd - A V Thomas Leather (UK) Ltd
- LJ International Ltd - A V Thomas Exports Ltd
- A V Thomas Investments
Company Ltd - Midland Latex Products Ltd
- The Nelliampathy Tea &
Produce Co.Ltd - Sermatech Private Ltd
- Neelamalai Agro Industries
Ltd - Ajit Thomas Holdings Private Limited
- The Midland Rubber and
Produce Company Ltd - Midland Corporate Advisory Services
P Ltd
- AVT McCormick Ingredients
Private Ltd - IQ Tech Private Limited
- AVT Natural Pte Ltd. - AVT Gavia Foods Pvt Ltd
- Heilongjiang AVT Bio-
Products Ltd - Tekessence Software Solutions P Ltd
- Teleflex Medical Private Ltd - Tek Health Services Inc USA
- AVT Infotech Private Ltd - Midland Charitable Trust
Key Management Personnel: Mr Ajit Thomas, Chairman
Mr M S A Kumar, Managing Director
7 Previous years figures have been regrouped wherever necessary to
conform to Current years classification.
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AVT Natural Products Ltd. Reports
- Accounting Policies
- Auditors Report
- Directors Report
- Notes To Account
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AVT Natural Products Ltd. Corporate Announcements
- Book Closure
- Dividend
- Board Meetings
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Stocks To Buy Today, Dec 4: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Thursday
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