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Notes to Accounts of Gloster Ltd.
Mar 31, 2025
2.16 Provisions
Provisions are recognized when there is a present obligation
as a result of a past event, it is probable that an outflow of
resources embodying economic benefits will be required
to settle the obligation and there is a reliable estimate of
the amount of the obligation. Provisions are measured at
the best estimate of the expenditure required to settle the
present obligation at the balance sheet date and are not
discounted to its present value, except where the effect of
the time value of money is material.
Contingent Liabilities
Contingent liabilities are disclosed when there is a possible
obligation arising from past events, the existence of which
will be confirmed only by the more uncertain future events
not wholly within the control of the Company or a present
obligation that arises from past events where it is either not
probable that an outflow of resources will be required to
settle or a reliable estimate of the amount cannot be made.
2.17 Offsetting Financial Instruments
Financial assets and liabilities are offset and the net amount
is reported in the balance sheet where there is a legally
enforceable right to offset the recognised amounts and there
is an intention to settle on a net basis or realise the asset and
settle the liability simultaneously. The legally enforceable
right must not be contingent on future events and must be
enforceable in the normal course of business and in event
of default, insolvency or bankruptcy of the Company or the
counterparty.
2.18 Segment reporting
Operating segments are reported in a manner consistent
with the internal reporting provided to the chief operating
decision maker. The Board of Directors of the Company has
been identified as being the chief operating decision maker.
Refer note 36 for segment information presented.
2.19 Leases
As a lessee Leases are recognised as right of use assets and a
correspondence liability at the date at which the leased asset
is available for use by the Company. Contract may contain
both lease and non-lease components. The Company
allocates the consideration in the contract to the lease and
non-lease components based on their relative standalone
prices. Assets and liabilities arising from a lease are initially
measured on a present value basis. Lease liabilities include
the net present value of the following lease payment:-
a) Fixed payments (including in substance fixed
payments) less any lease incentive receivable.
b) Variable lease payment that are based on an index or a
rate, initially measured using the index or a rate at the
commencement date.
c) Amount expected to be paid by the Company as
under residual value guarantees.
d) Exercise price of a purchase option if the Company is
reasonably certain to exercise that option.
e) Payment of penalties for terminating the lease, if
the lease term reflects the Company exercising that
option. Lease payments to be made under reasonably
certain extension options are also included in the
measurement of the liability. The lease payments
are discounted using the interest rate implicit in the
lease. If that rate cannot be readily determined, which
is generally the case for leases in the Company, the
lessee''s incremental borrowing rate is used, being
the rate that the individual lessee would have to pay
to borrow the funds necessary to obtain an asset of
similar value to the right-of-use asset in a similar
economic environment with similar terms, security
and conditions.
To determine the incremental borrowing rate, the Company:
a) Where possible, use recent third party financing
received by the individual lessee as a starting point,
adjusted to reflect changes in the financing conditions
since third party-financing was received.
b) Use a built up approach that starts with risk free
interest rate adjusted for credit risk of leases held by
Gloster Limited, which does not have recent third
party financing.
If a readily observable amortising loan rate is available to the
individual lessee (through recent financing or market data)
which has a similar payment profile to the lease, then the
company uses that rate as a starting point to determine the
incremental borrowing rate. Lease payments are allocated
between principal and finance cost. The finance cost is
charged to Statement of Profit and Loss over the lease period
so as to produce a constant periodic rate of interest on the
remaining balance of the liability for each period. Right-of
use assets are measured at cost comprising the following:-
i) the amount of the initial measurement of lease liability
ii) any lease payment made at or before the
commencement date less any lease incentive received
iii) any initial direct cost and
iv) restoration costs.
Right of use assets are generally depreciated over the
shorter of the asset''s useful life and the lease term on a
straight line basis. Payment associated with short-term
leases of equipment and all the leases of low value assets
are recognised on a straight line basis as an expense in the
Statement of Profit and Loss. Short term leases are leases
with a lease term of 12 months or less.
2.20 Trade Receivables
Trade receivables are amounts due from customers for goods
sold or services performed in the ordinary course of business
and reflects Company''s unconditional right to consideration
(that is, payment is due only on the passage of time). Trade
receivables are recognised initially at the transaction price as
they do not contain Significant financing components. The
Company holds the trade receivables with the objective of
collecting the contractual cash flows and therefore measures
them subsequently at amortised cost using the effective
interest method, less loss allowance.
2.21 Rounding of Amounts
All amounts disclosed in the financial statements and notes
have been rounded off to the nearest Lakhs (with two place
of decimal) as per the requirement of schedule 111, unless
otherwise stated.
2A Critical Estimates and Judgements
The preparation of financial statements requires the use
of accounting estimates which, by definition, will seldom
equal the actual results. Management also needs to exercise
judgement in applying the Company''s accounting policies.
This note provides an overview of the areas that involved a
higher degree of judgement or complexity, and of items which
are more likely to be materially adjusted due to estimates and
assumptions turning out to be different than those originally
assessed.
(i) Estimation of defined benefit obligation- Refer note 28 of the
financial statements.
(ii) Estimated fair value of unlisted securities -Refer notes 5 (b), 9
(a), and 33 of the -financial statements.
(iii) Useful life of Property, Plant and Equipment, Goodwill and
Other Intangible assets - Refer note 2.3 & 2.4 above and notes
3, 4(c) & 4(d) of the financial statements.
(iv) Net realizable value of inventory.
(v) Recoverable amount of investment in Subsidiaries (for
investment held at cost).
Estimates and judgements are continually evaluated. They are
based on historical experience and other factors, including
expectations of future events that may have a financial impact
on the Company and that are believed to be reasonable under
the circumstances.
The Company makes Pension Fund and Superannuation Fund contributions to defined contribution plans for qualifying employees.
Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The
contributions payable to these plans by the Company are at rates specified in the rules of the schemes.
(ii) Defined benefit plan
(a) Gratuity:
The employees'' gratuity fund scheme is managed by a Trust and is a defined benefit plan. The funds of the trust are managed by
approved insurance companies. Every employee is entitled to a benefit equivalent to fifteen day''s salary last drawn for each completed
year of service in line with Payment of Gratuity Act,1972. The same is payable at the time of separation from the Company or retirement,
whichever is earlier. Gratuity benefit vests after five year of continuous service. The present value of obligation is determined based on
actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of
employee benefit entitlement and measures each unit separately to build up the final obligation.
The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely
to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to
significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit
method at the end of the reporting period) has been applied while calculating the defined benefit liability recognised in the balance sheet.
The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.
Major categories of plan assets
The defined benefit plan is funded with insurance companies of
India. The Company does not have any liberty to manage the funds
provided to insurance companies. Thus the composition of each
major category of plan assets has not been disclosed.
Risk exposure
Through its defined benefit plans the Company is exposed to a
number of risks, the most significant of which are detailed below:
Investment risk:
The defined benefit plans are funded with insurance company
of India. The Company does not have any liberty to manage the
funds provided to insurance company. The fund is managed
by the insurance company and the assets are invested
in their conventional group gratuity product. The fund is
subject to market risk as the price of units may go up or down.
The present value of the defined benefit obligation is calculated
using a discount rate determined by reference to the Government
of India bonds. If the return on plan asset is below this rate, it will
create a plan deficit.
Interest rate risk:
The defined benefit obligation is calculated using a discount rate
based on government bonds. If the bond yields fall, the defined
benefit obligation will tend to increase.
Demographic risk:
This is the risk of variability of results due to unsystematic nature
of decrements that include mortality, withdrawal, disability and
retirement.
The effect of these decrements on the defined benefit obligation
is not straight forward and depends upon the combination of
salary increase, discount rate and vesting criteria. It is important
not to overstate withdrawals because in the financial analysis the
retirement benefit of a short career employee typically costs less
per year as compared to a long service employee.
Salary growth risk
The present value of the defined benefit obligation is calculated
by reference to the future salaries of plan participants. Higher
than expected increases in salary will increase the defined benefit
obligation.
Defined benefit liability and employer contributions
Expected contributions to post-employment benefits plans for the
year ending 31 March 2026 '' Nil.
The weighted average duration of the defined benefit obligation is
9 years ( 31 March 2024 - 8 years ).
(b) Provident fund
The Provident fund is managed by the Company in the line
with the Employees Provident Fund and Miscellaneous
Provision Act, 1952. The Fund is exempted under section 17
of Employees'' Provident Fund and Miscellaneous Provision
Act, 1952. Condition for grant of exemption stipulate that the
employer shall make good deficiency, if any, in the interest
declared by the trust vis-a-vis statutory rate. The contribution
by the employer and employees together with the interest
accumulated there on are payable to the employees at the
time of their separation from the company or retirement,
whichever is earlier. In view of the Company''s obligation
to meet the interest shortfall, this is a defined benefit plan.
The Contribution made by the Company and the shortfall of the
interest, if any, are recognised as an expense in the statement
of profit & loss under employee benefit expense in accordance
with an actuarial valuation of provident fund liabilities based
on guidance issued by Actuarial Society of India and based on
assumptions as mentioned below. Also refer note 21.
The investments in equity instruments are not held for trading. Instead, they are held for medium or long term investment. Upon the
application of Ind AS 109, the Company has chosen to designate these investments in equity instruments at FVOCI as the management
believe that this provides a more meaningful presentation for medium or long-term investments, than reflecting changes in fair value
immediately in profit or loss.
(i) Fair value hierarchy
This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a)
recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial
statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its
financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath
the table.
Level 1 [Quoted prices in an active market]
Level 1 hierarchy includes financial instruments measured using
quoted prices. This includes listed equity instruments and debentures
that have quoted price available. The fair value of all equity instruments
which are traded in the stock exchanges is valued using the closing
price as at the reporting period.
Level 2 [Fair values determined using valuation techniques with
observable inputs]
The fair value of financial instruments that are not traded in an
active market (for example, over-the-counter derivatives), Portfolio
Management Scheme (PMS) and Alternate Investment Fund (AIF), is
determined using valuation techniques which maximise the use of
observable market data and rely as little as possible on entity-specific
estimates. If all significant inputs required to fair value an instrument
are observable, the instrument is included in level 2.
Level 3 [Fair values determined using valuation techniques with
significant unobservable inputs]
If one or more of the significant inputs is not based on observable
market data, the instrument is included in level 3. This is generally the
case for unlisted equity securities and certain Alternative Investment
Funds (Equity & Debt ), wherein undelying investments are mainly real
estate / investment in equity shares of unlisted entities.
There are no transfers between Level 1, Level 2 and Level 3 during the
year.
(ii) Valuation techniques used to determine fair value
Specific valuation techniques used to value financial instruments
include:
⢠the use of quoted market prices for quoted equity shares and
debentures.
⢠the fair value of forward foreign exchange contracts is determined
using forward exchange rates at the balance sheet date.
⢠Investments in PMS and AIF carried at fair value, are generally based on
available NAVs. The fair value ofthe unquoted equity shares is determined
using valuation technique that maximises the use of relevant observable
inputs and minimises the use of unobservable inputs.
⢠The carrying amounts of trade receivables, loans, cash and
cash equivalents, other bank balances, other financial assets,
security deposits, trade payables and other financial liabilities are
approximate to their fair values.
⢠Management uses its best judgement in estimating the fair value
of its financial instruments. However, there are inherent limitations
in any estimation technique. Therefore, for substantially all financial
instruments, the fair value estimates presented above are not
necessarily indicative of the amounts that the Company could have
realised or paid in sale transactions as of respective dates. As such,
fair value of financial instruments subsequent to the reporting dates
may be different from the amounts reported at each reporting date.
⢠For financial assets and liabilities that are measured at fair value, the
carrying amounts are equal to their fair values.
c) Valuation processes
The finance department of the Company includes a team
that performs the valuations of financial assets and liabilities
required for financial reporting purposes, including level 3 fair
values. This team reports directly to the Chief Financial Officer
(CFO). The company also involves external valuation expert,
who presents a report that explains the reasons for the fair
value movements. Discussions of valuation processes and
results are held between the CFO, external valuation expert
and the valuation team at least once every year, in line with the
company''s reporting periods.
The main level 3 inputs for unlisted equity securities and
certain Alternative Investment Funds used by the company are
derived and evaluated as follows:
1) Cost or assets approach is used to derive the adjusted Net
Asset Value which involves determining the value per share
based on the respective assets and liabilities.
2) Determination of NAV based on the underlying investments of
Alternative Investment Fund.
iv) Fair value of financial assets and liabilities measured at
amortised cost; the carrying amounts of financial assets and
financial liabilities recognised in the financial statements
approximates their fair values.
v) Derecognition of Investment in equity instrument
designated at FVOCI :
The Company has derecognised the Investment in equity
instrument designated at FVOCI amounting to '' 3,111.96
Lakhs ( 31 March 2024 : '' 2,679.96 Lakhs ) and the gain/(loss)
on such disposal (net of tax) amounting to '' 1,415 Lakhs ( 31
March 2024 : '' 891.97 Lakhs ) has been transferred to Retained
Earnings.
The company has disposed certain investments designated
as OCI since management does not see any significant
appreciation in investments in medium / long-term.
(A) Credit risk
Credit risk is the risk that counterparty will not meet its obligations
under a financial instrument or customer contract, leading to
a financial loss. The Company is exposed to credit risk from
its operating activities (primarily trade receivables) including
deposits with banks and financial institutions, foreign exchange
transactions and other financial instruments carried at amortised
cost and fair value through Profit & Loss.
i) Trade receivables
Customer credit risk is managed by the Company through
established policy and procedures and control relating to
customer credit risk management. Trade receivables are non¬
interest bearing and are generally carrying 30 to 90 days credit
terms. The Company has a detailed review mechanism of overdue
customer receivables at various levels within organisation to
ensure proper attention and focus for realisation. Trade receivables
are consisting of a large number of customers. Where credit
risk is high, domestic trade receivables are backed by security
deposits. Export receivables are backed by letters of credit.
Financial assets are considered to be of good quality and there is
no significant increase in credit risk.
Provision for expected credit loss
The requirement for impairment is analysed at each reporting date.
For impairment, individual debtors are identified and assessed
specifically. 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. There has been no material default history
in the past and accordingly no provision is considered necessary.
The maximum exposure to the credit risk at the reporting date is
primarily from trade receivables.
ii) Financial instruments and cash deposits
Credit risk from balances with banks and investments is managed
by the Company''s finance department in accordance with the
Company''s policy. Investments of surplus fund in portfolio
management services, alternative investment funds, direct
equity, debentures and in private companies are made only with
approved counterparties and within credit limits assigned to
each counterparty, if any. Counterparty credit limits are reviewed
by the Company''s Board of Directors on an annual basis, and
may be updated throughout the year subject to approval of the
Company''s Board of Directors. The limits are set to minimise the
concentration of risks and therefore mitigate financial loss through
counterparty''s potential failure to make payments.
Balances with banks and deposits are placed only with highly
rated banks.
The Company''s maximum exposure to credit risk for the
components of the balance sheet is the carrying amounts as
disclosed.
(B) Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in
meeting obligations associated with financial liabilities that are
settled by delivering cash or another financial asset.
Prudent liquidity risk management implies maintaining sufficient
cash and marketable securities and the availability of funding
through an adequate amount of committed credit facilities
to meet obligations when due. Management monitors rolling
forecasts of the Company''s liquidity position (comprising the
undrawn borrowing facilities) and cash and cash equivalents on
the basis of expected cash flows.
(i) Maturities of financial liabilities
The tables below analyse the Company''s financial liabilities
into relevant maturity group based on their contractual
maturities.
The amounts disclosed in the table are the contractual
undiscounted cash flows. Balances due within 12 months
equal their carrying balances as the impact of discounting is
not significant.
(ii) Interest rate risk (All amounts in '' LaKns, unless otherwise stated)
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 debt obligations
with floating interest rates.
The Company''s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk, since neither the
carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.
(iii) Security price risk
The Company''s expense to equity securities price risk arises from instruments held by the Company and classified in the Balance Sheet
either as fair value through Other Comprehensive Income (OCI) or at fair value through Profit or Loss (Refer Note 33).
To manage its price risk arising from investments in equity securities the Company diversifies its portfolio.
(a) Interest rate risk exposure on financial liabilities
The exposure of the Company''s financial liabilities to interest rate risk is as follows:
Note: 35 Capital Management
(a) Risk management
The Company''s objectives when managing capital are to:
⢠safeguard their ability to continue as a going concern, so that
they can continue to provide returns for shareholders and
⢠benefits for other stakeholders, and maintain an optimal capital
structure to reduce the cost of capital.
The capital structure of the Company is based on management''s
judgement of the appropriate balance of key elements in order to
meet its strategic and day-to-day needs. The Company manages
its capital structure and makes adjustments in light of changes
in economic conditions and the requirements of the financial
covenants. The funding requirement is met through a mixture of
equity, long term borrowings and short term borrowings.
In order to maintain or adjust the capital structure, the Company
may adjust the amount of dividend paid to shareholders, return
capital to shareholders, issue new shares or sell assets to reduce
debt.
The Company monitors capital on the basis of the following
gearing ratio:
⢠net debt (total borrowings and lease liabilities net of cash and
cash equivalents)
⢠divided by total equity
Loan covenants
Under the terms of the major borrowing facilities, the Company is
required to comply with certain financial covenants. The Company
has complied with the debt covenants throughout the reporting
period.
Notes:
(a) Pursuant to approval of Board of Directors at its meeting held
on February 07, 2025 for conversion of loans given to Fort
Gloster Industries Limited (FGIL), wholly owned subsidiary,
amounting to '' 9,250 Lakhs, FGIL has allotted 9,25,00,000
number of Equity Shares to the Company at a face value of ''
10/- each on March 31,2025. [refer note 5(a) & (c)].
(b) Pursuant to approval of Board of Directors at its meeting held
on February 07, 2025 for conversion of loans given to Gloster
Nuvo Limited (GNL), wholly owned subsidiary, amounting to
'' 8,880 Lakhs, GNL has allotted 8,88,00,000 number of Equity
Shares to the Company at a face value of '' 10/- each on March
31,2025. [refer note 5(a) & (c)].
(c) The security deposit balance represents the amount actually
paid by the Company without impact of fair valuation. (fair
value of security deposit is '' 5.62 Lakhs (31 March 2024 - '' 5.27
Lakhs).
(d) The Company has entered into a lease arrangement with its
subsidiary Network Industries Limited pertaining to which
finance cost amounting to '' 16.81 Lakhs ( 31 March 2024
- '' 16.74 Lakhs) & depreciation amounting to '' 9.10 Lakhs
(31 March 2024 - '' 9.10 Lakhs) has been recognised in the
statement of Profit and Loss. The closing balance of lease
liabilities as on 31 March, 2025 is '' 240.75 Lakhs ( 31 March,
2024 - '' 238.95 Lakhs) (Non current) and '' 14.08 Lakhs (31
March, 2024 - '' 14.08 Lakhs) (Current) [refer note 42]
(e) For contribution to Gloster Jute Employees'' Gratuity Fund
please refer note no 28 (A) (ii) (a).
(f) For corporate guarantees given during the year and
outstanding as at 31 March 2025 - refer note 39.
(g) Maximum amount outstanding at any time during the year
are '' 9,080.00 Lakhs (31 March 2024 - ''1,600.00 Lakhs ) for
Gloster Nuvo Limited and '' 18,950.00 Lakhs ( 31 March 2024
- '' 14,300 Lakhs ) for Fort Gloster Industries Limited. For loans
outstanding as at 31 March 2025 & 31 March 2024 - refer note
5(d).
(h) Above loans are repayable on demand and interest rate for said
loan ranges from 9.70% to 9.80%.
Terms and conditions of the transactions
All outstanding balances are unsecured.
Disclosure pursuant to section 186(4) of the Companies Act,
2013, regarding investments/loans made in subsidiaries/group
companies and other investments are mentioned in note 5(b),
note 5(c) and note 9(a). For Guarantee & Loans - refer point (f),
(g) & (h) above.
All transactions are made in ordinary course of business and
are done on arms length basis.
Notes:
(i) The future cash outflow, if any, cannot be ascertained, pending resolution of the proceedings.
(ii) The Company does not expect any reimbursement in respect of the above contingent liabilities.
(iii) Corporate guarantee is given with respect to loan taken by Gloster Nuvo Limited [Loan outstanding 31 March 2025 - '' 18,858.98
Lakhs ( 31 March 2024 - '' 11,905.45 Lakhs)] and Fort Gloster Industries Limited [Loan outstanding 31 March 2025 - '' 22,084.86 Lakhs
( 31 March 2024 - '' Nil)].
Note : 42 Lease
The Company as a Lessee
(a) The Company has entered into four lease agreements as below:
Lease agreement for a term of thirty years commencing from
09 March 2021 for land situated at Bauria, West Bengal with it''s
wholly owned subsidiary. The lease payments are on fixed rental
basis along with an incremental clause every 5 years with an
option to renew at the end of lease period.
Lease agreement for a term of five years commencing from
01 April 2023 for Office Building situated at 21 Strand Road,
Kolkata - 700 001 with M/s. Oriental Company Limited. The lease
payments are on fixed rental basis without any incremental
clause with an option to renew at the end of lease period.
Lease agreement for a term of thirty years commencing from
01 March 2024 for land measuring about 21,807.388 Sq.mtr
situated at Budge Budge, West Bengal with Syama Prasad
Mookerjee Port. The lease payments are on fixed rental basis
along with an escalation of 5% every year without any option of
renewal.
Lease agreement for a term of thirty years commencing from 01
April 2024 for land measuring about 6,549.372 Sq.mtr situated
at Budge Budge, West Bengal with Syama Prasad Mookerjee
Port. The lease payments are on fixed rental basis along with an
escalation of 5% every year without any option of renewal.
The Company has certain lease premises with lease term of 12
months or less. The Company applies short-term recognition
exemption for these leases.
Note: 44
The Code on Social Security, 2020 (''Code'') relating to employee
benefits during employment and post-employment received
Indian Parliament approval and Presidential assent in
September 2020. The Code has been published in the Gazette
of India and subsequently on November 13, 2020 draft rules
were published and invited for stakeholders'' suggestions.
However, the date on which the code will come into effect
has not been notified. The Company will assess the impact of
the Code when it comes into effect and will record any related
impact in the period the Code becomes effective.
Note: 45
The Board of Directors at its meeting held on 13th November,
2024, approved the Scheme of amalgamation of Gloster
Lifestyle Limited and Gloster Specialities Limited (''Transferor
Companies'') both wholly owned subsidiaries of the Company
with Gloster Limited (''Transferee Company''), subject to
necessary approvals.
Note: 47
Additional Regulatory Information required by Schedule III
(i) No proceedings have been initiated on or are pending against
the company for holding benami property under the Prohibition
of Benami Property Transactions Act, 1988 (as amended in 2016)
[formerly the Benami Transactions (Prohibition) Act, 1988 (45 of
1988)] and Rules made there under.
(ii) The Company has been sanctioned working capital limit in
excess of '' 5 crores, in aggregate, from banks on the basis of
security of current assets. The Company has filed quarterly
returns or statements with such banks, which are in agreement
with the unaudited books of accounts. Further, the returns for
the quarter ended March 31,2025 would be appropriately filed
by the company within the extended due date.
(iii) The Company has not been declared wilful defaulter by any
bank or financial institution or government or any government
authority or other lender in accordance with the guidelines on
wilful defaulters issued by the Reserve Bank of India.
(iv) The Company has no transactions with the companies struck off
under the Companies Act, 2013 or Companies Act, 1956.
(v) The Company has complied with the number of layers as
prescribed in section 2(89) of the Companies Act read with
Companies (Restriction on number of layers) Rules, 2017 .
(vi) The Company has not entered into any scheme of arrangement
which has an accounting impact on current or previous financial
year. Also refer note 46.
(vii) I. The Company has not advanced or loaned or invested funds
to any other persons or entities, including foreign entities
(Intermediaries) with the understanding that the Intermediary
shall:
a) directly or indirectly lend or invest in other persons or
entities identified in any manner whatsoever by or on
behalf of the Company (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like to or on behalf
of the ultimate beneficiaries.
II. The Company has not received any fund from any persons or
entities, including foreign entities (Funding Party) with the
understanding (whether recorded in writing or otherwise) that
the Company shall:
a) directly or indirectly lend or invest in other persons or
entity identified in any manner whatsoever by or on behalf
of the Funding Party (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like on behalf of the
ultimate beneficiaries
(viii) 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.
(ix) The Company has not traded or invested in crypto currency or
virtual currency during the current or previous year.
(x) The Company has not revalued its property, plant and
equipment (including right-of-use assets) or intangible assets or
both during the current or previous year.
(xi) There are no charges or satisfaction which are yet to be registered
with the Registrar of Companies beyond the statutory period.
For Price Waterhouse & Co Chartered Accountants LLP For & on behalf of the Board Of Directors
Firm Registration No. 304026E/E-300009
Hemant Bangur (DIN: 00040903) Yogendra Singh (DIN: 10229584)
Executive Chairman Director
Pravin Rajani Ajay Kumar Agarwal Rajappa Shivalingappa (DIN: 02971967) Prabir Ray (DIN: 00698779)
Partner Chief Financial Officer CEO & Whole Time Director Director
Membership No. 127460
Place : Kolkata Ayan Datta Ishani Ray (DIN: 08800793) S. N. Bhattacharya (DIN: 06758088)
Dated: 29th May, 2025 Company Secretary Director Director
Mar 31, 2024
(i) Securities Premium
Securities premium represents premium on issue of shares. The reserve is utilised in accordance with the provisions of the Companies Act, 2013.
(ii) General reserve
General reserve is created and utilised in compliance with provisions of the Companies Act, 2013.
(iii) Retained earnings
Retained Earnings are the profits that the Company has earned till date, less any transfer to general reserve, dividends or other distributions to shareholders.
(iv) Equity instruments through OCI
The Company has elected to recognise changes in the fair value of all investments in equity securities in other comprehensive income. These changes are accumulated within the FVOCI equity investments reserve within equity. The Company transfers amounts from this reserve to retained earnings when the relevant equity securities are derecognised.
Notes:
(a) Secured by first charge on pari passu basis by way of hypothecation of the Company''s entire current assets and movables fixed assets. Secured by extension of first charge on pari passu basis by way of mortgage of the immovable properties of the company, situated at P.S. Bauria, Dist- Howrah.
(b) Loans from banks comprises of cash credit facilities and working capital demand loans which are payable on demand. The interest rate of such loan ranges from 0.15% to 1.10% spread over MCLR per annum and from 1.50% to 2.08% spread over 3 months T-Bill.
(c) Loans from banks has been utilized for the purpose for which it was taken.
The Company makes Pension Fund and Superannuation Fund contributions to defined contribution plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.
(ii) Defined benefit plan
(a) Gratuity:
The employees'' gratuity fund scheme is managed by a Trust and is a defined benefit plan. The funds of the trust are managed by approved insurance companies. Every employee is entitled to a benefit equivalent to fifteen day''s salary last drawn for each completed year of service in line with Payment of Gratuity Act,1972. The same is payable at the time of separation from the Company or retirement, whichever is earlier. Gratuity benefit vests after five year of continuous service. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors.
The expected return on plan assets is determined after taking into consideration composition of the plan assets held, assessed risks of assets management, historical results of the return on plan assets, and other relevant factors.
The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied while calculating the defined benefit liability recognised in the balance sheet. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.
Major categories of plan assets
The defined benefit plan is funded with insurance companies of India. The Company does not have any liberty to manage the funds provided to insurance companies. Thus the composition of each major category of plan assets has not been disclosed.
Risk exposure
Through its defined benefit plans the Company is exposed to a number of risks, the most significant of which are detailed below:
Investment risk:
The defined benefit plans are funded with insurance company of India. The Company does not have any liberty to manage the funds provided to insurance company. The fund is managed by the insurance company and the assets are invested in their conventional group gratuity product. The fund is subject to market risk as the price of units may go up or down. The present value of the defined benefit obligation is calculated using a discount rate determined by reference to the Government of India bonds. If the return on plan asset is below this rate, it will create a plan deficit.
Interest rate risk:
The defined benefit obligation is calculated using a discount rate based on government bonds. If the bond yields fall, the defined benefit obligation will tend to increase.
Demographic risk:
This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting
criteria. It is important not to overstate withdrawals because in the financial analysis the retirement benefit of a short career employee typically costs less per year as compared to a long service employee.
Salary growth risk
The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. Higher than expected increases in salary will increase the defined benefit obligation.
Defined benefit liability and employer contributions
Expected contributions to post-employment benefits plans for the year ending 31 March 2025 is Rs. Nil.
The weighted average duration of the defined benefit obligation is 8 years ( 31 March 2023 - 9 years ).
(b) Provident fund
The Provident fund is managed by the Company in the line with the Employee''s Provident Fund and Miscellaneous Provision Act, 1952. The Fund is exempted under section 17 of Employees'' Provident Fund and Miscellaneous Provision Act, 1952. Condition for grant of exemption stipulate that the employer shall make good deficiency, if any, in the interest declared by the trust vis-a-vis statutory rate. The contribution by the employer and employees together with the interest accumulated there on are payable to the employees at the time of their separation from the company or retirement, whichever is earlier. In view of the Company''s obligation to meet the interest shortfall, this is a defined benefit plan.
The Contribution made by the Company and the shortfall of the interest, if any, are recognised as an expense in the statement of profit & loss under employee benefit expense in accordance with an actuarial valuation of provident fund liabilities based on guidance issued by Actuarial Society of India and based on the assumptions as mentioned below. Also refer note 21.
(B) Other long term employee benefit plan ''
The Company provides benefits in the nature of compensated absences which can be accumulated. The compensated absences are other long term employee benefits plan. Accumulated Compensated Absences which are expected to be availed or encashed within the 12 months from the end of the year are treated as short term employee benefits and the balance expected to be availed or encashed beyond 12 months from the year end are treated as long term liability. Expenses recognised in the Statement of Profit and loss towards compensated absences includes re-measurement gains and losses.
The investments in equity instruments are not held for trading. Instead, they are held for medium or long term investment. Upon the application of Ind AS 109, the Company has chosen to designate these investments in equity instruments at FVOCI as the management believe that this provides a more meaningful presentation for medium or long-term investments, than reflecting changes in fair value immediately in profit or loss.
(i) Fair value hierarchy
This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.
Level 1 [Quoted prices in an active market]
Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments and debentures that have quoted price available. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period.
Level 2 [Fair values determined using valuation techniques with observable inputs]
The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives), Portfolio Management Scheme (PMS) and Alternate Investment Fund (AIF), is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3 [Fair values determined using valuation techniques with significant unobservable inputs]
If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is generally the case for unlisted equity securities and certain Alternative Investment Funds (Equity & Debt ), wherein undelying investments are mainly real estate / investment in equity shares of unlisted entities.
There are no transfers between Level 1, Level 2 and Level 3 during the year.
(ii) Valuation techniques used to determine fair value
Specific valuation techniques used to value financial instruments include:
⢠the use of quoted market prices for quoted equity shares and debentures.
⢠the fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date.
⢠Investments in PMS and AIF carried at fair value, are generally based on available NAVs. The fair value of the unquoted equity shares is determined using valuation technique that maximises the use of relevant observable inputs and minimises the use of unobservable inputs.
⢠The carrying amounts of trade receivables, loans, cash and cash equivalents, other bank balances, other financial assets, security deposits, trade payables and other financial liabilities are approximate to their fair values.
⢠Management uses its best judgement in estimating the fair value of its financial instruments. However, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented above are not necessarily indicative of the amounts that the Company could have realised or paid in sale transactions as of respective dates. As such, fair value of financial instruments subsequent to the reporting dates may be different from the amounts reported at each reporting date.
⢠For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to their fair values.
2) Determination of NAV based on the underlying investments of Alternative Investment Fund.
iv) Fair value of financial assets and liabilities measured at amortised cost: the carrying amounts of financial assets and financial liabilities recognised in the financial statements approximates their fair values.
v) Derecognition of Investment in equity instrument designated at FVOCI:
The Company has derecognised the Investment in equity instrument designated at FVOCI amounting to Rs 2,679.96 Lakhs ( 31 March 2023 : Rs 504.62 Lakhs ) and the gain/(loss) on such disposal (net of tax) amounting to Rs 891.97 Lakhs ( 31 March 2023 : Rs 136.35 Lakhs ) has been transferred to Retained Earnings.
The company has disposed certain investments designated as OCI since management does not see any significant appreciation in investments in medium / long-term.
c) Valuation processes
The finance department of the Company includes a team that performs the valuations of financial assets and liabilities required for financial reporting purposes, including level 3 fair values. This team reports directly to the Chief Financial Officer (CFO). The Company also involves external valuation expert, who presents a report that explains the reasons for the fair value movements, Discussions of valuation processes and results are held between the CFO, external valuation expert and the valuation team at least once every year, in line with the company''s reporting periods.
The main level 3 inputs for unlisted equity securities and certain Alternative Investment Funds used by the company are derived and evaluated as follows:
1) Cost or assets approach is used to derive the adjusted Net Asset Value which involves determining the value per share based on the respective assets and liabilities.
(A) Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments carried at amortised cost and fair value through Profit & Loss.
i) Trade receivables
Customer credit risk is managed by the Company through established policy and procedures and control relating to customer credit risk management. Trade receivables are non-interest bearing and are generally carrying 30 to 90 days credit terms. The Company has a detailed review mechanism of overdue customer receivables at various levels within organisation to ensure proper attention and focus for realisation. Trade receivables are consisting of a large number of customers. Where credit risk is high, domestic trade receivables are backed by security deposits. Export receivables are backed by letters of credit. Financial assets are considered to be of good quality and there is no significant increase in credit risk.
Provision for expected credit loss
The requirement for impairment is analysed at each reporting date. For impairment, individual debtors are identified and assessed specifically. 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. There has been no material default history in the past and accordingly no provision is considered necessary. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables.
ii) Financial instruments and cash deposits
Credit risk from balances with banks and investments is
managed by the Company''s finance department in accordance with the Company''s policy. Investments of surplus fund in portfolio management services, alternative investment funds, direct equity, debentures and in private companies are made only with approved counterparties and within credit limits assigned to each counterparty, if any. Counterparty credit limits are reviewed by the Company''s Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Company''s Board of Directors. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty''s potential failure to make payments.
Balances with banks and deposits are placed only with highly rated banks. The Company''s maximum exposure to credit risk for the components of the balance sheet is the carrying amounts as disclosed.
(B) Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Management monitors rolling forecasts of the Company''s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of expected cash flows.
(i) Maturities of financial liabilities
The tables below analyse the Company''s financial liabilities into relevant maturity group based on their contractual maturities. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.
(C) Market risk
(i) Foreign currency risk
The Company undertakes transactions (e.g. sale of goods and purchases of raw materials or capital goods) denominated in foreign currencies and thus is exposed to exchange rate fluctuations. The Company evaluates its exchange rate exposure arising from foreign currency transactions and
manages the same based upon approved risk management policies which inter-alia includes entering into forward foreign exchange contracts.
Foreign currency risk exposure
The Company''s exposure to foreign currency risk at the end of the reporting period expressed in Rs Lakhs (foreign currency amount multiplied by closing rate), are as follows:
(ii) Interest rate risk (All amounTS ln '' LaKns, unless otherwise stated)
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 debt obligations with floating interest rates.
The Company''s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.
(iii) Security price risk
The Company''s expense to equity securities price risk arises from instruments held by the Company and classified in the Balance Sheet either as fair value through Other Comprehensive Income (OCI) or at fair value through Profit or Loss (Refer Note 33).
To manage its price risk arising from investments in equity securities the Company diversifies its portfolio.
In order to maintain or adjust the capital structure, the Company may adjust the amount of dividend paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The Company monitors capital on the basis of the following gearing ratio:
⢠net debt (total borrowings and lease liabilities net of cash and cash equivalents)
⢠divided by total equity Loan covenants
Under the terms of the major borrowing facilities, the Company is required to comply with certain financial covenants. The Company has complied with the debt covenants throughout the reporting period.
Note: 35 Capital Management (a) Risk management
The company''s objectives when managing capital are to:
⢠safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and
⢠benefits for other stakeholders, and maintain an optimal capital structure to reduce the cost of capital.
The capital structure of the Company is based on management''s judgement of the appropriate balance of key elements in order to meet its strategic and day-to-day needs. The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The funding requirement is met through a mixture of equity, long term borrowings and short term borrowings.
Note: 36 Segment information
(a) Description of segments and principal activities
Gloster Limited is primarily engaged in the business of manufacture and sale of jute and jute allied goods. Gloster Limited exports to various countries spread over the world and is having its manufacturing facilities located in India. In accordance with Ind-AS 108 -"Operating Segment", the Company has presented segment information only on the basis of Consolidated Financial Statements.
Notes:
(a) Fort Gloster Industries Limited, has issued Zero Coupon Secured Convertible Debentures of Rs. 7,600.00 lakhs in lieu of advance against securities amounting to Rs. 7,530.30 Lakhs and balance amount of Rs. 69.70 lakhs has been paid by the Company during the year. Subsequently, the said debentures have been converted to equity shares of Rs. 7,600.00 Lakhs (7,60,00,000 equity shares of face value Rs. 10/- each) during the year [refer note 5(a) & (b)].
(b) The security deposit balance represents the amount actually paid by the Company without impact of fair valuation. (fair value of security deposit is Rs. 5.27 Lakhs (31 March 2023 - Rs. 4.94 Lakhs).
(c) The Company has entered into a lease arrangement with The Oriental Company Limited pertaining to which finance cost amounting to Rs. 23.71 Lakhs ( 31 March 2023 - Rs. Nil) & depreciation amounting to Rs. 65.47 Lakhs (31 March 2023 - Rs. Nil) has been recognised in the statement of profit and Loss. The closing balance of lease liabilities as on 31st March, 2024 is Rs. 173.79 Lakhs ( 31 March, 2023 - Rs. Nil) (Non current) and Rs. 69.12 Lakhs (31 March, 2023 - Rs. Nil) (Current) [refer note 42]
(d) The Company has entered into a lease arrangement with its subsidiary Network Industries Limited pertaining to which finance cost amounting to Rs. 16.74 Lakhs ( 31 March 2023 -Rs. 16.58 Lakhs) & depreciation amounting to Rs. 9.10 Lakhs (31 March 2023 - Rs. 9.10 Lakhs) has been recognised in the
statement of profit and Loss. The closing balance of lease liabilities as on 31 March, 2024 is Rs. 238.95 Lakhs ( 31 March, 2023 - Rs. 237.21 Lakhs) (Non current) and Rs. 14.08 Lakhs (31 March, 2023 - Rs. 14.08 Lakhs) (Current) [refer note 42]
(e) For contribution to Gloster Jute Employees'' Gratuity Fund please refer note no 28 (A) (ii) (a).
(f) For corporate guarantees given during the year and outstanding as at 31 March 2024 - refer note 39.
(g) Maximum amount outstanding at any time during the year are Rs. Nil (31 March 2023 - Rs. 1,250.00 Lakhs ) for Shri Vasuprada Plantations Ltd. (Formerly Joonktollee Tea & Industries Limited), Rs. Nil ( 31 March 2023 - Rs. 500.00 Lakhs) for Keshava Plantations Private Limited, Rs. Nil ( 31 March 2023 - Rs. 600.00 Lakhs ) for Network Industries Limited, Rs. 1,600.00 Lakhs (31 March 2023 - Rs.1,900.00 Lakhs ) for Gloster Nuvo Limited and Rs. 14,300.00 Lakhs ( 31 March 2023 - Rs. 6,100.00 Lakhs ) for Fort Gloster Industries Limited. For loans outstanding as at 31 March 2024 & 31 March 2023 - refer note 5(d).
(h) Above loans are repayable on demand and interest rate for said loan ranges from 9.65% to 11.15%.
Terms and conditions of the transactions
All outstanding balances are unsecured excluding outstanding
balance of investment made in Shri Vasuprada Plantations
Ltd. (Formerly Joonktollee Tea & Industries Limited), which is
secured.
Disclosure pursuant to section 186(4) of the Companies Act, 2013, regarding investments/loans made in subsidiaries/group companies and other investments are mentioned in note 5(b) ,note 5(c) and note 9(a). For Guarantee & Loans - refer point (f), (g) & (h) above.
All transactions are made in ordinary course of business and are done on arms length basis.
Consequent to approval of the shareholders at the Extra Ordinary General Meeting held on 02nd December, 2022, the Company has allotted Bonus Shares in the ratio of 1:1 i.e. one new equity share for every one existing equity share to the eligible shareholders of the Company. Accordingly, a sum of Rs. 547.16 lakhs has been capitalised and transferred to Share Capital Account on allotment of fully paid Bonus Shares. The earnings per share for previous year presented is based on current capital after issue of Bonus Shares in accordance with Ind AS - 33 on "Earnings per Share".
Note : 42 Lease
The Company as a Lessee
(a) The Company has entered into three lease agreements as below: Lease agreement for a term of thirty years commencing from 09 March 2021 for land situated at Bauria, West Bengal with it''s wholly owned subsidiary. The lease payments are on fixed rental basis along with an incremental clause every 5 years with an option to renew at the end of lease period.
Lease agreement for a term of five years commencing from 01 April 2023 for Office Building situated at 21 Strand Road, Kolkata - 700 001 with M/s. Oriental Company Limited. The lease
payments are on fixed rental basis without any incremental clause with an option to renew at the end of lease period. Lease agreement for a term of thirty years commencing from 01 March 2024 for land situated at Budge Budge, West Bengal with Syama Prasad Mookerjee Port. The lease payments are on fixed rental basis along with an escalation of 5% every year without any =option of renewal.
The Company has certain lease premises with lease term of 12 months or less . The Company applies short-term recognition exemption for these leases.
Note: 44
The Company had opted for the new tax regime under section 115BAA of the Income Tax Act, 1961 w.e.f. April 01,2022 which provides a domestic company with an option to pay tax @ 22.00% (effective rate of 25.17%) and accordingly remeasured deferred tax balances based on the revised applicable tax rate.
Note: 45
The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment received Indian Parliament approval and Presidential assent in September 2020. The Code has been published in the Gazette of India and subsequently on November 13, 2020 draft rules
were published and invited for stakeholders'' suggestions. However, the date on which the code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective.
Note: 46
The Board of Directors of the Company has at its meeting held on May 30, 2024, approved amalgamation of Gloster Lifestyle Limited and Gloster Specialities Limited (''Transferor Companies'') both wholly owned subsidiaries of the Company with Gloster Limited, (''Transferee Company'') subject to necessary statutory and regulatory approvals.
Note: 48
Additional Regulatory Information required by Schedule III
(i) No proceedings have been initiated on or are pending against the company for holding benami property under the Prohibition of Benami Property Transactions Act, 1988 (as amended in 2016) [formerly the Benami Transactions (Prohibition) Act, 1988 (45 of 1988)] and Rules made there under.
(ii) The Company has been sanctioned working capital limit in excess of Rs. 5 crores, in aggregate, from banks on the basis of security of current assets. The Company has filed quarterly returns or statements with such banks, which are in agreement with the unaudited books of accounts. Further, the returns for the quarter ended March 31,2024 would be appropriately filed by the company within the extended due date.
(iii) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority or other lender in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India.
(iv) The Company has no transactions with the companies struck off under the Companies Act, 2013 or Companies Act, 1956.
(v) The Company has complied with the number of layers as prescribed in section 2(89) of the Companies Act read with Companies (Restriction on number of layers) Rules, 2017 .
(vi) The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year. Also refer note 46.
(vii) I. The Company has not advanced or loaned or invested
funds to any other persons or entities, including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.
II. The Company has not received any fund from any persons or entities, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
a) directly or indirectly lend or invest in other persons or entity identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries
(viii) 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.
(ix) The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.
(x) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.
(xi) There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.
Mar 31, 2023
(e) Rights, preferences and restrictions attached to equity shares
The Company has only one class of equity shares having a par value of '' 10 per share. Each shareholder is eligible for one vote per share held. The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend.
In the event of liquidation of the Company, the holders of equity shares are eligible to receive the remaining assets of the Company after distribution of all the preferential amounts, in proportion to their shareholding.
(f) Details of bonus shares issued
The Company has issued 16,00,000 number of equity shares allotted as fully paid up by way of bonus shares of '' 10 each on 07 March, 2016.
The Company has issued 54,71,630 number of equity shares allotted as fully paid up by way of bonus shares of '' 10 each on 19 December, 2022.
Securities premium represents premium on issue of shares. The reserve is utilised in accordance with the provisions of the Companies Act, 2013.
(ii) General reserve
General reserve is created and utilised in compliance with provisions of the Companies Act, 2013.
(iii) Retained earnings
Retained Earnings are the profits that the Company has earned till date, less any transfer to general reserve, dividends or other distributions to shareholders.
(iv) Equity instruments through OCI
The Company has elected to recognise changes in the fair value of all investments in equity securities in other comprehensive income. These changes are accumulated within the FVOCI equity investments reserve within equity. The Company transfers amounts from this reserve to retained earnings when the relevant equity securities are derecognised.
(a) Secured by first charge and against hypothecation of the Company''s entire current assets and movables fixed assets of the Company. Secured by extension of first charge and against mortgage of the immovable properties of the Company, situated at P.S. Bauria, Dist-Howrah.
(b) Loans from banks comprises of cash credit facilities which are payable on demand. The interest rate of such loan ranges from 0% to 1.20% spread over MCLR per annum.
(c) Loans from banks has been utilized for the purpose for which it was taken.
The Company makes Pension Fund and Superannuation Fund contributions to defined contribution plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.
(ii) Defined benefit plan
(a) Gratuity
The employees'' gratuity fund scheme is managed by a Trust and is a defined benefit plan. The funds of the trust are managed by approved insurance companies. Every employee is entitled to a benefit equivalent to fifteen day''s salary last drawn for each completed year of service in line with Payment of Gratuity Act,1972. The same is payable at the time of separation from the Company or retirement, whichever is earlier. Gratuity benefit vests after five year of continuous service. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors.
The expected return on plan assets is determined after taking into consideration composition of the plan assets held, assessed risks of assets management, historical results of the return on plan assets, and other relevant factors.
Sensitivity analysis
The sensitivity of the defined benefit obligation to changes in the weighted principal assumptions is:
The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied while calculating the defined benefit liability recognised in the balance sheet. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period. Major categories of plan assets
The defined benefit plan is funded with insurance companies of India. The Company does not have any liberty to manage the funds provided to insurance companies. Thus the composition of each major category of plan assets has not been disclosed.
Risk exposure
Through its defined benefit plans the Company is exposed to a number of risks, the most significant of which are detailed below: Investment risk:
The defined benefit plans are funded with insurance company of India. The Company does not have any liberty to manage the funds provided to insurance company. The fund is managed by the insurance company and the assets are invested in their conventional group gratuity product. The fund is subject to market risk as the price of units may go up or down.
The present value of the defined benefit plan liability is calculated using a discount rate determined by reference to the Government of India bonds. If the return on plan asset is below this rate, it will create a plan deficit.
The defined benefit obligation is calculated using a discount rate based on government bonds. If the bond yields fall, the defined benefit obligation will tend to increase.
Demographic risk:
This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria. It
is important not to overstate withdrawals because in the financial analysis the retirement benefit of a short career employee typically costs less per year as compared to a long service employee.
Salary growth risk
The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. Higher than expected increases in salary will increase the defined benefit obligation.
Defined benefit liability and employer contributions
Expected contributions to post-employment benefits plans for the year ending 31 March 2024 are '' 578.47 Lakhs.
The weighted average duration of the defined benefit obligation is 9 years ( 2022 - 9 years ).
(b) Provident fund
The Provident fund is managed by the Company in line with the Employees Provident Fund and Miscellaneous Provision Act, 1952. The Fund is exempted under section 17 of Employees'' Provident Fund and Miscellaneous Provision Act, 1952. Condition for grant of exemption stipulate that the employer shall make good deficiency, if any, in the interest declared by the trust vis-a-vis statutory rate. The contribution by the employer and employees together with the interest accumulated there on are payable to the employees at the time of their separation from the company or retirement, whichever is earlier. In view of the Company''s obligation to meet the shortfall, this is a defined benefit plan.
The contribution made by the Company and the shortfall of the interest, if any, are recognised as an expense in profit & loss under employee benefit expense.
(B) Other long term employee benefit plan
The Company provides benefits in the nature of compensated absences which can be accumulated. The compensated absences are other long term employee benefits plan. Accumulated Compensated Absences which are expected to be availed or encashed within the 12 months from the end of the year are treated as short term employee benefits and the balance expected to availed or encashed beyond 12 months from the year end are treated as long term liability. Expenses recognised in the Statement of Profit and Loss towards compensated absences includes re-measurement gains and losses.
The investments in equity instruments are not held for trading. Instead, they are held for medium or long term investment. Upon the application of Ind AS 109, the Company has chosen to designate these investments in equity instruments at FVOCI as the management believe that this provides a more meaningful presentation for medium or long-term investments, than reflecting changes in fair value immediately in profit or loss.
This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.
Level 1 [Quoted prices in an active market]
Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments that have quoted price available. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period.
Level 2 [Fair values determined using valuation techniques with observable inputs]
The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives), Portfolio Management Scheme (PMS) and Alternate Investment Fund (AIF), is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3 [Fair values determined using valuation techniques with significant unobservable inputs]
If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is generally the case for unlisted equity securities and certain Alternative Investment Funds (Equity & Debt ), wherein undelying investments are mainly real estate / investment in equity shares of unlisted entities.
There are no transfers between Level 1, Level 2 and Level 3 during the year.
(ii) Valuation techniques used to determine fair value
Specific valuation techniques used to value financial instruments include:
⢠the use of quoted market prices for quoted equity shares
⢠the fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date
⢠Investments in PMS and AIF carried at fair value, are generally based on available NAVs. The fair value of the unquoted equity shares is determined using valuation technique that maximises the use of relevant observable inputs and minimises the use of unobservable inputs.
⢠The carrying amounts of trade receivables, loans, cash and cash equivalents, other bank balances, other financial assets, security deposits, trade payables and other financial liabilities are approximate to their fair values, due to their short-term nature.
⢠Management uses its best judgement in estimating the fair value of its financial instruments. However, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented above are not necessarily indicative of the amounts that the Company could have realised or paid in sale transactions as of respective dates. As such, fair value of financial instruments subsequent to the reporting dates may be different from the amounts reported at each reporting date.
⢠For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.
No reasonable change in assumptions would result in significant changes in the fair value.
The finance department of the Company includes a team that performs the valuations of financial assets and liabilities required for financial reporting purposes, including level 3 fair values. This team reports directly to the Chief Financial Officer (CFO). The Company also involves external valuation expert, who presents a report that explains the reasons for the fair value movements. Discussions of valuation processes and results are held between the CFO, external valuation expert and the valuation team at least once every year, in line with the company''s reporting periods.
The main level 3 inputs for unlisted equity securities and certain Alternative Investment Funds used by the Company are derived and evaluated as follows:
1) Cost or assets approach is used to derive the adjusted Net Asset Value which involves determining the value per share based on the respective assets and liabilities.
2) Determination NAV based on the underlying investments of Alternative Investment Fund.
iv) Fair value of financial assets and liabilities measured at amortised cost; the carrying amounts of financial assets and financial liabilities recognised in the financial statements approximates their fair values.
v) Derecognition of Investment in equity instrument designated at FVOCI : The Company has derecognised the Investment in equity instrument designated at FVOCI amounting to '' 504.62 Lakhs ( 31.03.2022 - '' 579.01 Lakhs ) and the gain/(loss) on such disposal (net of tax) amounting to '' 136.35 Lakhs ( 31.03.2022 - '' 300.09 Lakhs ) has been transferred to Retained Earnings. The Company has disposed certain investments designated as OCI since management does not see any significant appreciation in investments in medium / long-term.
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments carried at amortised cost.
i) Trade receivables
Customer credit risk is managed by the Company through established policy and procedures and control relating to customer credit risk management. Trade receivables are non-interest bearing and are generally carrying 30 to 60 days credit terms. The Company has a detailed review mechanism of overdue customer receivables at various levels within organisation to ensure proper attention and focus for realisation. Trade receivables are consisting of a large number of customers. Where credit risk is high, domestic trade receivables are backed by security deposits. Export receivables are backed by letters of credit. Financial assets are considered to be of good quality and there is no significant increase in credit risk.
Provision for expected credit loss
The requirement for impairment is analysed at each reporting date. For impairment, individual debtors are identified and assessed specifically. 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. There has been no material default history in the past and accordingly no provision is considered necessary. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables.
ii) Financial instruments and cash deposits
Credit risk from balances with banks and investments is managed by the Company''s finance department in accordance
15ft I Gloster limited with the Company''s policy. Investments of surplus fund in portfolio management services, alternate investment funds, direct equity and in private companies are made only with approved counterparties and within credit limits assigned to each counterparty, if any. Counterparty credit limits are reviewed by the Company''s Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Company''s Board of Directors. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty''s potential failure to make payments.
Balances with banks and deposits are placed only with highly rated banks/financial institution.
The Company''s maximum exposure to credit risk for the components of the balance sheet is the carrying amounts as disclosed.
(B) Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Management monitors rolling forecasts of the Company''s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of expected cash flows.
(i) Maturities of financial liabilities
The tables below analyse the Company''s financial liabilities into relevant maturity group based on their contractual maturities.
The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.
The Company undertakes transactions (e.g. sale of goods and purchases of raw materials or capital goods) denominated in foreign currencies and thus is exposed to exchange rate fluctuations. The Company evaluates its exchange rate exposure arising from foreign currency transactions and
manages the same based upon approved risk management policies which inter-alia includes entering into forward foreign exchange contracts.
Foreign currency risk exposure
The Company''s exposure to foreign currency risk at the end of the reporting period expressed in '' Lakhs (foreign currency amount multiplied by closing rate), are as follows:
(ii) Interest rate risk (All amounts ln '' Lakhs, unless otherwise stated)
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 debt obligations with floating interest rates.
The Company''s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.
Note: 35 Capital Management (a) Risk management
The company''s objectives when managing capital are to:
⢠safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and
⢠benefits for other stakeholders, and maintain an optimal capital structure to reduce the cost of capital.
The capital structure of the Company is based on management''s judgement of the appropriate balance of key elements in order to meet its strategic and day-to-day needs. The Company manages its capital structure and makes adjustments in light of
changes in economic conditions and the requirements of the financial covenants. The funding requirement is met through a mixture of equity, long term borrowings and short term borrowings.
In order to maintain or adjust the capital structure, the Company may adjust the amount of dividend paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
Under the terms of the major borrowing facilities, the Company is required to comply with certain financial covenants. The Company has complied with the debt covenants throughout the reporting period.
(All amounts in '' Lakhs, unless otherwise stated)
Note: 36 Segment information
(a) Description of segments and principal activities
Gloster Limited is primarily engaged in the business of manufacture and sale of jute and jute allied goods. Gloster Limited exports to various countries spread over the world and is having its manufacturing facilities located in India. In accordance with Ind-AS 108 -"Operating Segment", the Company has presented segment information only on the basis of Consolidated Financial Statements.
(g) Maximum amount outstanding at any time during the year are '' 1,250.00 Lakhs (31 March 2022 - '' 1,250.00 Lakhs) for Shri Vasuprada Plantations Ltd. (Formerly Joonktollee Tea & Industries Limited), '' 500.00 Lakhs ( 31 March 2022 - '' 500.00 Lakhs) for Keshava Plantations Private Limited, '' 600.00 Lakhs ( 31 March 2022 - '' Nil ) for Network Industries Limited, '' 1,900.00 Lakhs (31 March 2022 - '' Nil ) for Gloster Nuvo Limited and '' 6,100.00 Lakhs ( 31 March 2022 - '' Nil ) for Fort Gloster Industries Limited. For loans outstanding as at 31 March 2023 & 31 March 2022 - refer note 5(d) & 9(e).
(h) Above loans are repayable on demand other than loan given to Fort Gloster Industries Limited, which is repayable on demand after 31 December 2024 and interest rate for said loan ranges from 9.65% to 12.00%.
Terms and conditions of the transactions All outstanding balances are unsecured excluding outstanding balance of investment made in Shri Vasuprada Plantations Ltd. (Formerly Joonktollee Tea & Industries Limited), which is secured. Disclosure pursuant to section 186(4) of the Companies Act, 2013, regarding investments/loans made in subsidiaries/group companies and other investments are mentioned in note 5(b), note 5(c) and note 9(a). For Guarantee & Loans - refer point (f), (g) & (h) above.
All transactions are made in ordinary course of business and are done on arms length basis.
(a) With respect to Network Industries Limited, in the current year 2,61,90,000 equity shares of '' 10 each amounting to '' 2,619.00 Lakhs were issued. [refer note 5(a)].
(b) With respect to Fort Gloster Industries Limited, outstanding balance of Advance for Investment in Subsidiaries amounting to '' 7,530.30 Lakhs will be adjusted against the issue of securities by the subsidiary company [refer note 5(a)].
(c) The security deposit balance represents the amount actually paid by the Company without impact of fair valuation. [fair value of security deposit is '' 4.94 Lakhs (31 March 2022 - '' 4.63 Lakhs)].
(d) The Company has entered into a lease arrangement with its subsidiary Network Industries Limited pertaining to which finance cost amounting to '' 16.58 Lakhs ( 31 March 2022 -'' 16.49 Lakhs) & depreciation amounting to '' 9.10 Lakhs (31 March 2022 - '' 9.10 Lakhs) has been recognised in the standalone financial statements. The closing balance of lease liabilities as on 31 March 2023 is '' 237.21 Lakhs ( 31 March 2022 - '' 235.63 Lakhs) (Non current) and '' 14.08 Lakhs (31 March 2022 - '' 14.08 Lakhs) (Current) [refer note 42]
(e) For contribution to Gloster Jute Employees'' Gratuity Fund please refer note no 28 (A) (ii) (a).
(f) For corporate guarantees given during the year and outstanding as at 31 March 2023 - refer note 39.
Consequent to approval of the shareholders at the Extra Ordinary General Meeting held on 02nd December, 2022, the Company has allotted Bonus Shares in the ratio of 1:1 i.e. one new equity share for every one existing equity share to the eligible shareholders of the Company. Accordingly, a sum of '' 547.16 Lakhs has been capitalised and transferred to Share Capital Account on allotment of fully paid Bonus Shares. The earnings per share for previous year presented are based on current capital after issue of Bonus Shares in accordance with Ind AS - 33 on "Earnings per Share".
Note : 42 Lease
The Company as a Lessee
(a) The Company has entered into lease agreement for a term of thirty years commencing from 09 March 2021 for land situated at Bauria, West Bengal with it''s wholly owned subsidiary. The lease payments are on fixed rental basis along with an incremental clause every 5 years with an option to renew at the end of lease period.
Note: 44
The Company has opted for the new tax regime under section 115BAA of the Income Tax Act, 1961 w.e.f. April 01,2022 which provides a domestic company with an option to pay tax @ 22.00% (effective rate of 25.17%) and accordingly remeasured deferred tax balances based on the revised applicable tax rate.
Note: 45
The exceptional item pertains to the recovery of inter corporate deposit which was written off in the earlier years.
Note: 46
The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment received Indian Parliament approval and Presidential assent in September 2020. The Code has been published in the Gazette of India and subsequently on November 13, 2020 draft rules were published and invited for stakeholders'' suggestions. However, the date on which the code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective.
Additional Regulatory Information required by Schedule III
(i) No proceedings have been initiated on or are pending against the Company for holding benami property under the Prohibition of Benami Property Transactions Act, 1988 (as amended in 2016) [formerly the Benami Transactions (Prohibition) Act, 1988 (45 of 1988)] and Rules made there under.
(ii) The Company has been sanctioned working capital limit in excess of '' 5 crores, in aggregate, from banks on the basis of security of current assets. The Company has filed quarterly returns or statements with such banks, which are in agreement with the unaudited books of accounts. Further, the returns for the quarter ended March 31,2023 would be appropriately filed by the Company within the extended due date.
(iii) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority or other lender in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India.
(iv) The Company has no transactions with the companies struck off under the Companies Act, 2013 or Companies Act, 1956.
(v) The Company has complied with the number of layers as prescribed in section 2(89) of the Companies Act read with Companies (Restriction on number of layers) Rules, 2017.
(vi) The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.
(vii) i.The Company has not advanced or loaned or invested
funds to any other person or entity, including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.
ii. The Company has not received any fund from any person or entity, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
a) directly or indirectly lend or invest in other persons or entity identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries
(viii) 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.
(ix) The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.
(x) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.
(xi) There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.
Mar 31, 2018
Notes to the Standalone Financial Statements
(All amounts in INR lakhs, unless otherwise stated)
A.2 Ind AS mandatory exceptions
A.2.1 Estimates
An entity''s estimates in accordance with Ind AS''s at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.
Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:
Investment in equity instruments carried at FVOCI Investment in debt instruments carried at FVTPL A.2.2 Classification and measurement of financial assets
Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exists at the date of transition to Ind AS.
Accordingly, the Company has determined the classification and measurements of financial assets on the basis of the facts and circumstances that exists at the date of transition to Ind AS.
B: Reconciliations between previous GAAP and Ind AS Reconciliation of total equity as at 31 March 2017 and 1 April 2016
|
Particulars |
Notes |
31 March 2017 |
1 April 2016 |
|
Total equity (shareholder''s funds) as per previous GAAP |
1,537.47 |
1,416.78 |
|
|
Impact of merger with erstwhile Gloster Limited |
80,533.69 |
77,616.38 |
|
|
Total equity |
82,071.16 |
79,033.16 |
|
|
Adjustments |
|||
|
Fair valuation of investments |
1 |
4,469.94 |
2,654.30 |
|
Gain on MTM of derivative instruments |
2 |
155.77 |
70.97 |
|
Reversal of proposed dividend and tax thereon |
3 |
- |
313.38 |
|
Tax effects on above adjustments |
(762.19) |
(452.22) |
|
|
Total equity as per Ind AS |
85,934.68 |
81,619.59 |
|
Reconciliation of total comprehensive income for the year ended 31 March 2017
|
Particulars |
Notes |
Amount |
|
Profit/ (Loss) after tax as per previous GAAP |
120.69 |
|
|
Impact of merger with erstwhile Gloster Limited |
2,913.99 |
|
|
Profit/ (Loss) after tax as per previous GAAP- revised |
3,034.68 |
|
|
Ind AS adjustments: |
||
|
Fair valuation of investments measured at FVTPL |
1 |
257.17 |
|
Gain on MTM of derivative instruments |
2 |
84.80 |
|
Actuarial gain/ loss reclassed from to OCI |
4 |
76.87 |
|
Tax effect on above adjustments |
(48.77) |
|
|
Total adjustments |
370.07 |
|
|
Profit after tax impact as per Ind AS |
3,404.75 |
|
|
Other comprehensive income net of tax effects |
5 |
1,223.72 |
|
Total comprehensive income as per Ind AS |
4,628.47 |
No material impact of Ind AS adoption on the statements of cash flows for the year ended 31 March 2017
Notes to the standalone Financial Statements
C: Notes to first-time adoption:
Note 1: Fair valuation of investments
Under the previous GAAP, investments in equity instruments, alternate investment funds and mutual funds were classified as long-term investments or current investments based on the intended holding period and realisability. Long-term investments were carried at cost less provision for other than temporary decline in the value of such investments. Current investments were carried at lower of cost and fair value. Under Ind AS, these investments are required to be measured at fair value. The resulting fair value changes of these investments (other than equity instruments designated as at FVOCI) have been recognised in retained earnings as at the date of transition and subsequently in the Statement of profit or loss for the year ended 31 March 2017.
Fair value changes with respect to investments in equity instruments designated as at FVOCI have been recognised in FVOCI - Equity investments reserve as at the date of transition and subsequently in the other comprehensive income for the year ended 31 March 2017.
Note 2: Derivatives
Under the previous GAAP, the Company applied the requirements of the guidance note issued on accounting for derivatives and accordingly all derivative contracts outstanding at the balance sheet were marked to market and resulting loss, if any, was recognized in the statement of profit and loss. However, no gains were recognized.
Under Ind AS, derivatives which are not designated as hedging instruments are fair valued with resulting changes being recognised in profit or loss. Consequently, the total equity has increased as on the date of transition and profit for the year ended 31 March 2017 has also increased.
Note 3: Proposed dividend
Under the previous GAAP, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognised as a liability. Under Ind AS, such dividends are recognised when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount.
Note 4:Remeasurements of post-employment benefit obligations
Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in
(All amounts in INR lakhs, unless otherwise stated) the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. There is no impact on the total equity as at 31 March 2017.
Note 5: Other comprehensive income
Under Ind AS, all items of income and expense recognised in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in Statement of profit or loss but are shown in the statement of profit and loss as ''other comprehensive income'' includes items such as remeasurements of defined benefit plans, equity instruments designated as at FVOCI. Tax effect of such items are also included in ''other comprehensive income''. The concept of other comprehensive income did not exist under previous GAAP.
Note: 40
A. Pursuant to the Scheme of Amalgamation of erstwhile Gloster Limited ("the Transferor Company"), with Kettlewell Bullen & Company Limited (renamed as Gloster Limited) (''the Company'') filed under Section 391 to 394 and other applicable provisions of the Companies Act, 1956 & Companies Act, 2013, to the extent applicable and sanctioned by the National Company Law Tribunal, Kolkata ("NCLT") vide its order dated 19 January 2018 (the ''Scheme''):
a. The Transferor Company stands transferred to and vested in the Company, as a going concern, in accordance with Section 2(1B) of the Income Tax Act without any further act, instrument, deed, matter or thing so as to become, on and from 1 January 2015 (the "Appointed Date"), by virtue of and in the manner provided in the Order. Certified copy of the said Order of NCLT sanctioning the Scheme has been filed by both Transferor Company and the Company with the Registrar of Companies, Kolkata and accordingly, the Scheme became effective on and from 30 March 2018. (the ''Effective Date'').
b. In accordance with the NCLT Order sanctioning the Scheme the Company has accounted the assets and liabilities of the Transferor Company vested in it pursuant to the scheme at their respective fair values as per Purchase method in accordance with Accounting Standard-14-"Accounting for Amalgamations" notified under the Companies Act, 1956 read with Section 133 of The Companies Act, 2013 and Rule 7 of Companies (Accounts) Rules 2014. Although the said accounting treatment is at variance with Ind AS 103, it has been carried out in accordance with the NCLT Order.
c. Further, in keeping with the Scheme the Company has: i. accounted for the excess of fair value of equity shares issued and cancellation of investment in Transferor Company, over the fair value of net assets of Transferor Company amounting to ? 45,348.03 lakhs so acquired, being ?33,330.86 lakhs as Goodwill, representing underlying intangible assets, acquired on amalgamation as on 1 January 2015 (included under point B of this note).
ii) amortized Goodwill acquired on account of amalgamation as indicated in (c) (1) above, during the year in the Statement of Profit and Loss for Rs 1,666.54 lakhs on the basis of management''s estimated useful life of 20 years. Had Goodwill not been amortized, the Depreciation and Amortization expense for the year ended 31 March, 2018 would have been lower by ? 1,666.54 lakhs and Profit before tax for the year ended 31 March, 2018 would have been higher by an equivalent amount and the carrying amount of Goodwill (under Intangible Assets- Refer Note 3(d))
and Retained Earnings as at 31 March, 2018 would have been higher by Rs. 5,416.28 lakhs and ? 3,682 lakhs respectively, considering the cumulative effect of aforesaid amortization from 1 January, 2015.
d. Upon the Scheme coming into effect, the Company has recorded issuance of 34,71,630 (Thirty four lakhs seventy one thousand six hundred and thirty) equity shares of face value of ? 10/- each at fair value of ?2,261 per share and accordingly credited to its share capital ? 347.61 lakhs on 10 May, 2018 being , the aggregate face value of the equity shares issued on Amalgamation. The excess of the fair value of the equity shares over the face value of the shares issued amounting to ? 78,146. 39 lakhs has been credited to Securities Premium Account on 10 May, 2018. Further, the entire shareholding of the Company in transferor Company stands cancelled. Since allotment of such shares was pending till year end, the related amount of Rs. 78,493.55 lakhs has been disclosed as ''Equity Share Suspense'' in Note 12 to the Financial Statements.
B. The Statement of Assets & Liabilities as at 1 January, 2015, being the Appointed Date, transferred pursuant to the Scheme of Amalgamation is set out below:
|
Particulars |
Amount |
|
Assets acquired |
|
|
Property, Plant & Equipment |
29,892.63 |
|
Identified intangible assets |
9,379.42 |
|
Capital Work-in-progress |
155.05 |
|
Other Non-current Assets |
2,919.45 |
|
Current Assets |
11,160.19 |
|
Liabilities assumed |
|
|
Non-current Liabilities |
1,244.89 |
|
Current Liabilities |
6,913.82 |
|
Net identifiable assets |
45,348.03 |
|
Consideration for the above |
78,678.89 |
|
Goodwill arising on amalgamation |
33,330.86 |
Note: 41 Net debt reconciliation
This section sets out an analysis of net debt and the movements in net debt
|
Particulars |
31 March 2018 |
31 March 2017 |
|
Current borrowings |
1,548.21 |
3,441.65 |
|
Non-current borrowings |
128.40 |
166.67 |
|
Net debt |
1,676.61 |
3,608.32 |
|
Particulars |
| Liabilities from financing activities |
|
|
Non-current borrowings |
Current borrowings |
|
|
Net debt as at 01 April 2017 |
166.67 |
3,441.65 |
|
Proceeds from borrowings during the year |
128.40 |
1,281.02 |
|
Repayment of borrowings during the year |
(166.67) |
(3,333.67) |
|
Proceeds from bills discounted |
- |
267.19 |
|
Settlement of bills discounted |
- |
(107.98) |
|
Net debt as at 31 March 2018 |
128.40 |
1,548.21 |
Note: 42 Dues to micro and small enterprises
The Company has certain dues to Suppliers registered under The Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) are:
|
Sl.no. |
Particulars |
31 March 2018 |
31 March 2017 |
1 April 2016 |
|
1 |
The principal amount remaining unpaid to any supplier as at the year end |
1.08 |
0.33 |
1.21 |
|
The interest remaining unpaid to any supplier as at the year end |
1.75 |
1.62 |
1.44 |
|
|
2 |
Principal amounts paid to suppliers beyond the appointed day during the year. |
5.61 |
13.86 |
11.16 |
|
Interest paid under Section 16 of the MSMED Act, to suppliers during the year. |
- |
- |
- |
|
|
3 |
The amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the interest specified under the MSMED Act, 2006 |
|||
|
4 |
The amount of interest accrued and remaining unpaid at the end of the year |
0.13 |
0.17 |
0.25 |
|
5 |
The amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues as above are actually paid to the small enterprise, for the purpose of disallowance as a deductible expenditure under section 23 of the MSMED Act, 2006. |
1.75 |
1.61 |
1.44 |
*included in SI No. 1 above is Rs 1.08 lakhs (31.03.2017 Rs. 0.33 lakhs, 01.04.2016 Rs. 1.21 lakhs) being interest on principal amount remaining unpaid as at the beginning of the accounting year.
Note:
The information has been given in respect of such vendors to the extent they could be identified as "Micro, Small & Medium" enterprises on the basis of information available with the Company.
|
For Price Waterhouse & Co Chartered Accountants LLP |
|||||
|
Firm Registration No. 304026E/E-300009 |
|||||
|
Chartered Accountants |
|||||
|
Hemant Bangur |
Executive Chairman |
||||
|
D.C. Baheti |
Managing Director |
||||
|
Sunit Kumar Basu |
S.B. Mainak |
Director |
|||
|
Place: Kolkata |
Partner |
Shankar Lai Kedia |
Ajay Kumar Agarwal |
S.N. Bhattacharya |
Director |
|
Date:29th May, 2018 |
Membership No.55000 Chief Financial Officer Company Secretary |
Prabir Ray |
Director |
||
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Stocks To Buy Today, Dec 19: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Friday -
Stocks To Buy Today, Dec 18: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Thursday -
Stocks To Buy Today, Dec 17: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Wednesday -
Stocks To Buy Today, Dec 16: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Tuesday -
India Stock Market Weekly Review: Nifty and Sensex Fall as Caution Spreads -
Stocks To Buy Today, Dec 15: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Monday
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Stocks To Buy Today, Dec 12: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Friday -
Market Outlook 2026: Kotak Securities Sees Nifty 50 at 30,000; THESE 4 Sectors Lead Rally, Gold To Stay Strong -
Stocks To Buy Today, Dec 10: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Wednesday -
D-Street Bleeds For 2nd Day! Sensex Slumps 678 Pts; Nifty Cracks 25,800; Why Stock Market Is Falling Today? -
Stocks To Buy Today, Dec 9: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Tuesday -
Stocks To Buy Today, Dec 8: Top 4 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Monday -
Stock Market Alert! Major Pre-Open Session Change From Dec 8: Full Timings, Rules & All You Need To Know -
Bank Nifty Surges: RBI’s 25 bps Rate Cut Triggers Strong Upside in Major Banking Stocks -
Closing Bell: Sensex Ends 158 pts Higher, Nifty Climbs Above 26,000; Hero MotoCorp, HAL Up 2% Each -
Stocks To Buy Today, Dec 4: Top 2 Picks By Riyank Arora of Mehta Equities For Profitable Trading On Thursday
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