Notes to Accounts of Hilton Metal Forging Ltd.

Mar 31, 2024

c. Term/ Right Attached to Equity Share

The company has only one class of equity shares having a per value of Rs. 10 per share. Each share of Equity shares is entitled to one vote per share. In the event of liquidation of the company, the holders of equity shares will be receive remaining assets of the company, after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

Money received agianst Share Warrants represents amounts received towards share warrants which entitles the warrant holders the option to apply for and be allotted equivalent number of equity shares of the face value of Rs. 10/ each.

During the financial year, the Company has issued on preferential basis 2,700,000 share warrants at a price of Rs. 55.00 each entitling them for subscription of equivalent number of Equity Shares of Rs. 10/- each (including premium of Rs. 45/- each Share) under Regulation 28(1) of the SEBI (LODR) Regulations, 2015. The holder of the share warrants would need to exercise the option to subscribe to equity shares before the expiry of 18 months from the date of allotment made on 04th April, 2023 upon payment of the balance 75% of the consideration of share warrants.

Further during the year the Group has not excercised the option to convert the warrants into equity shares.

In previous year 2022-23, total 2556984 share warrants converted into 2,556,984 equity shares.

e. Issue of shares under right issue

F.Y.2023-24

During the financial year The Company has not issued equity shares under right issues.

F.Y.2022-23

The Company had, issued 60,00,000 equity shares of face value of Rs. 10/- each (''Rights Equity Shares’) to the Eligible Equity Shareholders at an issue price of Rs. 55 per Rights Equity Share (including premium of Rs. 45 per Rights Equity Share). The rights were offered in ratio of 2:5.

Based on the guiding principles given in Ind AS 108 on ''Operating Segments'', the Company''s business activity falls within a single operating segment, namely Manufacturing of Steel Forgings, Flanges and Forged Fittings for oil & gas industry, Petrochemicals and refineries industry. Accordingly, the disclosure requirements of Ind AS 108 are not applicable.

The company operates one-defined plans, viz., gratuity Under the gratuity plan, every employee who has completed atleast five years of service gets a gratuity on departure @ 15 out of 26 days of salary for year of service. The gross obligation toward the gratuity at the end of the year on is Rs.93.50 Lacs (previous year, Rs. 86.33 Lacs).

The benefits are governed by the companys Leave Policy. The gross obligation toward the Leave Benefit at the end of the year on is Rs. 6.90 Lacs (previous year, Rs. 6.90 Lacs).

Foreign currency exposure that are not hedge by derivative instruments as on 31st March, 2024 is USD $ 349,563 & Euro (€) 55,250 [previous year USD $ 1,056,502 & Euro (€) Nil]. The unhedged exposure are naturally hedged by foreign currency earings and earnings linked to foreign currency.

The management has assessed that the carrying values of the Financial Assets and Liabilities at amortised cost approximate their fair value largely due to their short-term maturities of these instruments.

Note 38 - Financial Risk Management Objectives And Policies

The Company''s principal financial assets include trade & other receivables, and cash & cash equivalents that derives directly from its operations. The Company''s principal financial liabilities comprise trade & other payables and short term borrowings. The main purpose of majority of these financial liabilities is to manage working capital of the Company.

The Company is exposed to credit risk, market risk and liquidity risk. The Company''s senior management oversees the management of these risks. The Company''s financial risk activities are governed by appropriate policies and procedures and financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. The below note explains the sources of risk which the Company is exposed to and how the entity manage the risk :

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) and from its investing activities, primarily cash & cash equivalents.

i) Trade receivables

Customer credit risk is managed in accordance with the Company''s established policy, procedures and controls relating to customer credit risk management. Credit quality of a customer is assessed based on individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored through credit lock and release effectively manage the exposure.

An impairment analysis is performed at each reporting date on an individual basis for major customers. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on historical data. The Company does not hold any collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as most of its external customers are established players in their industry.

The Company determines the allowance for credit losses based on historical loss experience adjusted to reflect current and estimated future economic conditions. The Company considered current and anticipated future economic conditions relating to industries the Company deals with and the countries where it operates. In calculating expected credit loss, the Company has also considered related credit information for its customer, that''s available in public domain to estimate the probability of default in future and has taken into account estimates of possible effect from the global situations.

ii) Cash and Cash equivalents and Other financial assets

Credit risk from balances with banks is managed by the Board of Directors in accordance with the Company''s policy. Investment of surplus funds are made for short-term in deposit with banks. Investments and Bank deposits are reviewed by the Board of Directors on a quarterly basis. Credit risk arising from short term liquid fund, cash and cash equivalents and other balances with banks is limited and no collaterals are held against these because the counterparties are banks.

Other financial assets mainly include security deposits & other receivables. There are no indications that defaults in payment obligations would occur in respect of these financial assets.

B) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. The Company is exposed to different types of market risks. For the Company, the market risk is the possibility of changes in foreign currency exchange rates and commodity prices which may affect the value of the Company''s financial assets, liabilities or expected future cash flows.

i) Commodity Risk

Commodity risk for the Company is mainly related to fluctuations in steel prices which drives the prices of billet, steel bars, and tubes. Since, steel is the primary input materials for making of forging, which are used in manufacturing the final products, any fluctuation in steel prices can lead to drop in operating margin. Most of these input materials are procured from approved vendors and subject to price negotiations. In order to mitigate the risk associated with raw material and components prices, the Company manages its procurement through productivity improvements, expanding vendor base and constant pricing negotiation with vendors. The Company renegotiates the prices with its customers in case there is more than normal deviation in the prices of its major raw materials. Additionally, the processes and policies related to such risks are reviewed and controlled by senior management team.

ii) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The risk of fluctuations in foreign currency exchange rates on its financial liabilities including trade and other payables etc., which are mainly in US Dollars are mitigated through the natural hedge alignment, as Company''s export sales are predominantly in US dollars and such economic exposure through trade and other receivables in US dollars provide natural alignment. Hence, a reasonable variation in the Foreign exchange rate would not have much impact on the profit or loss / equity of the Company. Net foreign currency exposure also reviewed by the Board of Directors on a quarterly basis.

Foreign currency sensitivity analysis

The Company is exposed to the currencies USD & EURO on account of outstanding receivables ( ) and payables (-). The Company''s net exposure to foreign currency risk at the end of the reporting period expressed in respective currencies given below;

Foreign currency exposure that are not hedge by derivative instruments as on 31st March, 2024 is USD $ 349,563 & Euro (€) 55,250 [previous year USD $ 1,056,502 & Euro (€) Nil]. The unhedged exposure are naturally hedged by foreign currency earings and earnings linked to foreign currency.

C) Liquidity risk

Liquidity risk is defined as a risk that the Company will not be able to meet its obligations on time or at a reasonable price. An effective liquidity risk management takes into consideration in maintaining optimum level of cash and cash equivalents and the availability of funding through an credit facilities at a reasonable cost to meet the obligation when due. Additionally, the processes and policies related to such risks are reviewed and controlled by senior management team. Management continuously reviews the actual cash flows and forecasts the expected cash flows to monitor the liquidity position. All the current financial liabilities of the Company are due to be paid with in twelve months from the date from the Balance sheet date. All non-current financial liabilities are due to be paid in more than twelve months from the Balance sheet date. However the interest component of all the non-current financial liabilities if any will be payable as and when due, which may be with in twelve months from the date of Balance sheet date.

Note 40 - Details of dues to micro and small enterprises as defined under the MSMED Act, 2006

Dues to micro and small enterprises as defined under MSMED Act, 2006, the company has not made interest provision on late payment to creditors, due to the negotiation on the accepted date, under the said act as per the applicable provisions of the law in respect to the extent of such parties have been identified on the basis of information collected by the Management. Further the company has not received intimation from every "suppliers" regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosure, if any, relating to amounts unpaid as at the year end together with interest paid/payable as required under the said Act have not been given.

Note 41 - Deferred taxes

Deferred tax is calculated in temporary differences between accounting and tax values as well as any tax losses carried forward at the year-end. Net deferred tax assets are recognized only to the extent that it is probable they will be utilized against future taxable profits.

Note 42 - Out of the total debtors of Rs. 3215.53 Lakhs as at March 31, 2024, Rs.500.48 Lakhs has more than one year at the year end. For this the management is in discussion with these debtors to expedite the recoverability of the above aforesaid outstanding amounts and believes that the entire amount is fully recoverable. In view of the forgoing, no provision is considered necessary in these financial statements in this regard.

Note 43 - Other Statutory Information

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

b. The Company does not have any transactions with struck off companies.

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

d. The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961.

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

f. The Company has complied with the number of layers prescribed under the Companies Act, 2013.

Note 44 - The balance appearing under the head Trade receivable, trade payable, loans & advances and outstanding balance are subject to confirmation and reconciliation and consequent adjustment, if any, will be accounted for in the year of confirmation and / or reconciliation. However, the Management does not expect any material variation in the financial results.

Note 45 - The figures for the corresponding previous year have been regrouped/ reclassified wherever necessary, to make them comparable.

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Mar 31, 2014

1 Corporate information

Hilton Metal Forging Limited established in 2005 is a manufacturer of iron and steel forging, recognized export house, presently catering to the needs of Oil and Gas, Refineries and pharmaceutical industries. The company has its plant at Village Ghonsai, Taluka Wada, Dist Thane and Corporate office at 701 Palm Spring, Link Road, Malad West, Mumbai 400064, Maharashtra.



NOTE 2 :Contingent Liabilities and commitments ( to the extent not provided for)

(i) Contingent Liability

(a) Claims against the company not acknowledge as debt 409.86 409.86 MSEDCL has raised assessment bill for Rs 4,09,86,435/- U/s 135 of Electricity Act, 2003 alleging tampering with meter, which has been challenged in MSED Court Thane. The Honorable court while admitting the petition, ordered to Deposit of Rs 50 Lacs, pending disposal of petition.

(ii) Commitments

Discloser required under Section 22 of the Micro, Small and Medium enterprises Development Act

None

(dues to Micro and Small Enterprises could not be determined for wants of sufficient information to the extent such parties can be categorized /identified of its stature.

Disclosure as per Clause 32 of the Listing Agreement with Stock Exchanges:

Loans and advances in nature of loans given to subsidiaries, associates and others and investment in shares of the company by such parties:

Nil

Note : 3 Segment Information

The Company identifies primary segments based on the dominant source, nature of risks and returns and the internal organization and management structure. The operating segments are the segments for which separate financial information is available and for which operating profit/loss amounts are evaluated regularly by the executive Management in deciding how to allocate resources and in assessing performance.

The Company is mainly engaged in Manufacturing of Steel Forgings and Flanges and Forged Fittings for oil & gas industry, Petrochemicals and refineries, which in the context of Accounting standard (AS) 17 "Segment Reporting is considered to be the only business segment

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Mar 31, 2013

1 Corporate information

The company established in 2005 is manufacturer of iron and steel forging and recognized export house presently catering to the needs of Oil and Gas, Refineries and pharmaceutical industries. The company has its plant at Village Ghonsai, Taluka Wada, Dist Thane and Corporate office at 701 Palm Spring, Link Road, Malad West, Mumbai 400064, Maharashtra.

Note : 2 Segment Information

The Company identifies primary segments based on the dominant source, nature of risks and returns and the internal organization and management structure. The operating segments are the segments for which separate financial information is available and for which operating profit/loss amounts are evaluated regularly by the executive Management in deciding how to allocate resources and in assessing performance.

The Company is mainly engaged in Manufacturing of Steel Forgings and Flanges and Forged Fittings is considered as only one segment as such in the context of Accounting standard (AS) 17 "Segment Reporting".

Note : 3 Related party Transactions

Key Management Personnel Mr Yuvraj Malhotra

Mr Navraj Malhotra

Relatives to KMP Mrs Diksha Malhotra

Miss Yashika Malhotra

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Mar 31, 2012

1 Corporate information

The company esatablished in 2005 is manufacturer of iron and steel forging and recognised export house presently catering to the needs of Oil and Gas, Refinanries and pharmaceautical industries. The company has its plant at Village Ghonsai, Taluka Wada, Dist Thane and Corporate office at 701 Palm Spring, Link Road, Malad West, Mumbai 400064, Maharashtra.

2.23 Derivative contracts

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to highly probable forecast transactions. The Company designates such forward contracts in a cash flow hedging relationship by applying the hedge accounting principles set out in "Accounting Standard 30 Financial Instruments: Recognition and Measurement". These forward contracts are stated at fair value at each reporting date. Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for hedge accounting. If the forecasted transaction is no longer expected to occur, the net cumulative gain or loss recognised in "Hedging reserve account" is immediately transferred to the Statement of Profit and Loss.

2.24 Share issues expenses

Share issue expenses and re-operative expenses are written off and charged to profit and loss account The balance to the extent not written off is carried as an asset and is amortised over a period of 10 years

2.25 Insurance claims

Insurance claims are accounted for on the basis of claims admitted / expected to be admitted and to the extent that there is no uncertainty in receiving the claims.

2.26 Service tax input credit

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is no uncertainty in availing / utilising the credits.

Contingent Liabilities and commitments (to the extent not provided for)

(i) Contingent Liability

Claims against the company not acknowledge as debt

(b) Guarantees the company has not issued to as an other person or third party other money for which the company is contingently liable Material cleared under Bond UT-1 and CT

Details of derivatives instruments and unheeded foreign currency exposures.

The following derivative position are open as at 31st March 2012. these transactions have been under taken to act as economic hedges for the company's exposes to various risks in foreign exchange markets and may /may not qualify or to be designated as hedging instruments .the accounting of theses transactions is stated in

note 2.11 and 2.26

Forward Exchange contracts and options (being derivative instruments) which are not intended for trading or speculative purpose but for hedge purposes to establish the amount of reporting currency required or available at the statement date of certain payable or receivable.

The Company identifies primary segments based on the dominant source, nature of risks and returns and the internal organisation and management structure. The operating segments are the segments for which spear financial information is available and for which operating profit/loss amounts are evaluated regularly by the executive Management in deciding how to allocate resources and in assessing performance

The Company is mainly engaged in Manufacturing of Steel Forgings and Flanges and Forged Fittings for oil & gas industry, Petrochemicals and refineries, which in the context of Accounting standard (AS) 17 "Segment Reporting" is considered to be the only business segment

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Mar 31, 2011

Amount Rs in Lacs Description 31st March 2011 31stMarch 2010 Amount Amount

1 Contingent Liability Not Provided For

1. Bank Guarantee Issued 213.76 124.82

2. Materials Cleared- UT-landCT-1 141.95 0.00

2 The company is covered under the provisions of Minimum Alternative Tax (MAT) and has provided income tax in the books as per section 115JB of the Income Tax Act, 1961.

3. The company has duly complied with the Accounting Standards referred in sub-section 3(c) of section 211 of the Companies Act 1956.

4. Fixed Assets:

The plot No 21, 25,26, 28,29 and 30 situated at wada, are still standing in the name of one of the director Mr Yuvraj Malhotra for want of mutation process to be completed for revenue records. Necessary steps are being taken to get the same mutated in the name of the company.

5. Current Assets:

In the Opinion of the Board of Directors of the Company, all items of the current assets including Loans and Advances continue to have a realizable value of at least the amount at which they are stated on the Balance Sheet.

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Mar 31, 2010

1. Secured Loans

Term Loans from Banks are secured by way of first charge against mortgage of Companys immoveable assets at Wada, Dist Thane, Maharashtra, and through subsisting pari-passu second charge over Companys all moveable assets both present and future and guaranteed by CMD.

2. Working Capital facilities from the banks (included in Schedule III) are secured by way of hypothecation of stocks and book debts. The said facilities are also secured by way of second and subservient charges against mortgage of Companys immoveable assets at Wada, Dist Thane, Maharashtra and guaranteed by CMD.

3. Fixed Assets:

The plot No 21, 25, 26, 28, 29 and 30 situated at wada, are still standing in the name of one of the director Mr Yuvraj Malhotra for want of mutation process to be completed for revenue records. Necessary steps are being taken to get the same mutated in the name of the company.

4. Current Assets:

In the Opinion of the Board of Directors of the Company, all items of the current assets including Loans and Advances continue to have a realizable value of at least the amount at which they are stated on the Balance Sheet.

5. Contingent Liabilities not provided for

Guarantee given by the company Rs 124.82 Lacs (Rs121.83 Lacs)

6. At the closure of the year, the company has valued and accounted an amount of Rs 221.20 Lacs (Rs. 352.55 Lacs-) as export incentives being the benefit on account of entitlement to import duty-free materials under Entitlement Pass-book Scheme, as detailed in Accounting Policies A (5) (ii)

7. During the year, Material Worth Rs 235.16 Lacs (previous Year Rs. 148.14 Lacs) were called back due to radioactive contamination was noticed in material exported from India. Out of this material worth Rs 341,85449/ - have been re-exported after thorough checking during the year . The Balance worth Rs 41,45,664/-is under process of checking and will be re-exported in due course.

8. (A) Closing Stock of Raw material Include:

Goods Lying with Third Party

(b) Closing stock of Semi finished goods (WIP) includes" Goods lying with third party Nil (Nil)

9. The company has only one segment namely forgings, hence no separate disclosure of segment wise information has been made as required by accounting Standard 17 on "Segment Reporting" as issued by The Institute of Chartered Accountant of India.

10 Related Party Disclosures:

Names of related parties and description of relationship:

1. Key Management Personal Mr. Yuvraj Malhotra.

Mr. Navraj Malhotra

2. Relatives of Key Management Personal. Mrs. Diksha Malhotra

M/S. Yuvraj Malhotra HUF.

3. Enterprises significantly influenced by Hilton Steel Forging Pvt.Ltd key Management personal and Relatives. M/S. Delta Cut Tools

11. Public Issue Expenses and Preliminary expenses are amortized over a period of ten years.

12. Previous years figures have been regrouped and rearranged where ever necessary.