Notes to Accounts of Mafatlal Industries Ltd.

Mar 31, 2025

xvi. Provisions, contingent liabilities and contingent
assets

Provisions are recognized when the Company
has a present legal or constructive obligation as a
result of past events, it is probable that an outflow
of resources will be required to settle the obligation
and the amount can be reliably estimated. These
are reviewed at each reporting period and reflect
the best current estimate. Provisions are not
recognized for future operating losses.

Where there are a number of similar obligations,
the likelihood that an outflow will be required
in settlement is determined by considering the

class of obligations as a whole. A provision is
recognized even if the likelihood of an outflow with
respect to any one item included in the same class
of obligations may be small.

The amount recognized as a provision is the best
estimate of the consideration required to settle the
present obligation at the end of the reporting period,
taking into account the risks and uncertainties
surrounding the obligation. When a provision is
measured using the cash flow estimated to settle
the present obligation, its carrying amount is the
present value of those cash flows.

Contingent liabilities are disclosed when there is
a possible obligation arising from past events,
the existence of which will be confirmed only by
the occurrence or non-occurrence of one or 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 the obligation or a reliable
estimate of the amount cannot be made.

Contingent assets are not recognized in the
financial statements unless it is virtually certain
that the future event will confirm the asset''s
existence and the asset will be realized.

xvii. Employee benefits

(a) Short-term employee benefits

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

(b) Other long-term employee benefits

The liabilities for earned leave is not expected
to be settled wholly within 12 months after
the end of the period in which the employees
render the related service. They are therefore
measured as the present value of expected
future payments to be made in respect

of services provided by employees up to
the end of the reporting period using the
projected unit credit method. The benefits
are discounted using the market yields at the
end of the reporting period that have terms
approximating to the terms of the related
obligation. Remeasurements as a result of
experience adjustments and changes in
actuarial assumptions are recognized in the
Statement of Profit and Loss.

The obligations are presented as current
liabilities in the Balance Sheet if the entity
does not have an unconditional right to defer
settlement for at least 12 months after the
reporting period, regardless of when the
actual settlement is expected to occur.

(c) Post-employment obligations

Defined benefit plans

The present value of the defined benefit
obligation is determined by discounting the
estimated future cash outflows by reference
to market yields at the end of the reporting
period on Government bonds that have terms
approximating to the terms of the related
obligation.

The net interest cost is calculated by
applying the discount rate to the net balance
of the defined benefit obligation and the fair
value of plan assets. This cost is included in
employee benefit expense in the Statement
of Profit and Loss.

Remeasurement gains and losses arising
from experience adjustments and changes in
actuarial assumptions are recognized in the
period in which they occur directly in Other
Comprehensive Income. They are included
in retained earnings in the Statement of
Changes in Equity and in the Balance Sheet.

Changes in the present value of the defined
benefit obligation resulting from plan
amendments or curtailments are recognized
immediately in profit or loss as past service
cost.

Defined Contribution plan

The Company has no further payment
obligations once the contributions have
been paid. The contributions are accounted
for as defined contribution plans and the
contributions are recognized as employee
benefit expense when they are due. Prepaid
contributions are recognized as an asset to
the extent that a cash refund or a reduction in
the future payments is available.

(d) Share based payments

The fair value of options granted under
the Employee Option Plan is recognized
as an employee benefits expense with a
corresponding increase in equity. The total
amount to be expensed is determined by
reference to the fair value of the options
granted:

• including any market performance
conditions (e.g., the entity''s share price)

• excluding the impact of any service
and non-market performance vesting
conditions (e.g. profitability, sales
growth targets and remaining an
employee of the entity over a specified
time period), and

• including the impact of any non-vesting
conditions (e.g. the requirement for
employees to save or holdings shares
for a specific period of time).

The total expense is recognized over the
vesting period, which is the period over which
all of the specified vesting conditions are to
be satisfied. At the end of each period, the
entity revises its estimates of the number
of options that are expected to vest based
on the non-market vesting and service
conditions. It recognizes the impact of the
revision to original estimates, if any, in profit
or loss, with a corresponding adjustment to
equity.

Where shares are forfeited due to a failure by
the employee to satisfy the service conditions,
any expenses previously recognized in
relation to such shares are reversed effective
from the date of the forfeiture.

Refer note 2A (xiii) in material accounting
policies above relevant to Employee benefits.

xviii. Cash dividend and non-cash distribution

The Company recognizes a liability to make cash
or non-cash distributions to equity holders of the
Company when the distribution is no longer at
the discretion of the Company. As per the Act, a
distribution is authorized when it is approved by
the shareholders in case of final dividend and by
the Board of Directors in case of interim dividend.
A corresponding amount is recognized directly in
equity.

xix. Earnings per share

(a) Basic earnings per share

Basic earnings per share is calculated by
dividing:

• the profit attributable to owners of the
Company

• by the weighted average number of
ordinary shares outstanding during
the financial year, adjusted for bonus
elements in ordinary shares issued
during the year.

(b) Diluted earnings per share

Diluted earnings per share adjusts the figures
used in the determination of basic earnings
per share to take into account:

• t he after income tax effect of interest
and other financing costs associated
with dilutive potential ordinary shares,
and

• the weighted average number of
additional ordinary shares that would
have been outstanding assuming the
conversion of all dilutive potential
ordinary shares.

xx. Cash flow statement

Cash flows are reported using the indirect
method, whereby profit before tax is adjusted for
the effects of transactions of non-cash nature
and any deferrals or accruals of past or future
cash receipts or payments. The cash flows from
operating, investing and financing activities of the
Company are segregated based on the available
information.

xxi. Contributed equity

Equity shares are classified as equity.

Incremental costs directly attributable to the issue
of new shares or options are shown in equity as a
deduction, net of tax, from the proceeds.

xxii. Operating cycle

Based on the nature of products / activities of
the Company and the normal time between
acquisition of assets and their realization in cash
or cash equivalents, the Company has determined

its operating cycle as 12 months for the purpose
of classification of its assets and liabilities as
current and non-current.

xxiii. Exceptional Item

Exceptional item include income or expense that
are considered to be part of ordinary activities,
however, are of such significance and nature
that separate disclosure enables the user of the
financial statements to understand the impact
in a more meaningful manner. Exceptional items
are identified by virtue of either their size or nature
so as to facilitate comparison with prior periods
and to assess underlying trends in the financial
performance of the Company.

xxiv. Rounding of amounts

All amounts disclosed in the financial statements
and notes have been rounded off to the nearest
crores as per the requirement of Schedule III,
unless otherwise stated.

Amounts recognized in the Standalone Statement of Profit and Loss:

Inventory write downs are accounted, considering the nature of inventory, aging and net realizable value. Write down
of inventories amounted to '' 7.99 (March 31,2024: Write down of '' 4.33) were recognized as an expense during the
year and included in ''changes in value of inventories of finished goods, work-in-progress and stock-in-trade'' in the
Standalone Statement of Profit and Loss.

* Amount is below the rounding off norm adopted by the Company

** Current loans against properties from a bank aggregating to '' 10.25 (March 31,2024: '' 24.95) is secured by pari-
passu charge on Land and Building of the Company at Nadiad measuring 3,66,392 sq. mtr (March 31,2024: 3,66,392
sq. mtr) and charge on certain stocks and book debts, both present and future of the Company which is repayable on
demand and carrying an interest in the range of 10.00% p.a. to 10.75% p.a. (March 31,2024: 10.75% p.a. to 11.50%
p.a.).

** Current loans against properties from a bank aggregating to '' 15.37 (March 31,2024: '' 12.47) is secured by pari-
passu charge on Land and Building of the Company at Nadiad measuring 3,66,392 sq. mtr (March 31,2024: 3,66,392
sq. mtr) which is repayable on demand and carry an interest in the range of 10.00% p.a. to 10.25% p.a. (March 31,
2024: 10.00% p.a. to 11.00% p.a).

* Working Capital loans from banks aggregating to '' 6.99 (March 31,2024: '' NIL) are secured by first charge on certain
stocks and book debts, both present and future, of the Company, charge on certain property, pledge of 47,24,454
(March 31, 2024: 69,31,818) equity shares of NOCIL Limited held by the Company. The working capital loans were
repayable on demand and carry an interest in the range of 9.65% p.a. to 10.25% p.a. (March 31,2024: 9.55% p.a. to
11.50% p.a).

The Company has recognized the deferred tax asset on unabsorbed depreciation and business losses of earlier
years, loss allowance on trade receivables and deposits and disallowances under Section 35DDA, 40(a)(i) and 43B
of the Income Tax Act, 1961. The Company has concluded that the deferred tax assets will be recoverable partially
compensated by decrease in deferred tax liabilities and excess will be recovered using estimated future taxable
income. Further, unabsorbed depreciation can be carried forward for infinite period as per tax regulations.

Note 37 - Fair value measurements

(i) Financial Instrument by category and hierarchy

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be

exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

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

- Fair value of cash and bank balances, trade receivables, current loans, trade payables, current borrowings
and other current financial assets and liabilities approximate their carrying amounts largely due to short
term maturities of these instruments.

- Financial instruments with fixed and variable interest rates are evaluated by the Company based on
parameters such as interest rates and individual credit worthiness of the counterparty. Based on this
evaluation, allowances are taken to account for expected losses of these receivables. Accordingly, fair value
of such instruments is not materially different from their carrying amounts.

- The interest rate on term deposits is at the prevailing market rates. Accordingly, fair value of such instrument
is not materially different from their carrying amounts.

- The interest rate on borrowing is at the prevailing market rates. Accordingly, fair value of such instruments
is not materially different from their carrying amounts.

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

values.

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments

by valuation technique:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using

valuation techniques which maximize 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: If one or more of the significant inputs is not based on observable market data, the instrument is
included in level 3. This is the case for unlisted equity securities, contingent consideration and indemnification
asset included in level 3.

There were no transfers between level 1, level 2 and level 3 during the year.

Difference between fair value of non-current financial instruments carried at amortized cost and carrying value is not
considered to be material to the financial statements.

(iii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

- the use of quoted market prices for quoted shares.

- the fair value of the other unquoted equity investments is mainly pertaining to investments in co-operative
banks which are carried at amortized cost and the carrying amounts are equal to the fair values.

Note 38 - Share based payments

(a) Employee option plan

(i) The Mafatlal Employee Stock Option Scheme 2017 (''ESOS 2017'') of Mafatlal Industries Limited was
approved by the Board of Directors of the Company at their meeting held on May 5, 2017 and finalized
on August 10, 2017. At the Annual General Meeting held on August 2, 2017, the shareholders approved
the creation of employee stock option pool of 6,95,000 equity shares of face value of '' 10/- each fully
paid up (before giving effect of sub-division) on such terms and such manner as the Board may decide in
accordance with the provisions of applicable law and ESOS 2017.

The Company has implemented ESOS 2017 with a view to attract and retain key talents working with the
Company by way of rewarding their performance and motivate them to contribute to the overall corporate
growth and profitability. The Nomination and Remuneration Committee (''NRC'') administers ESOS 2017,
in compliance with the provisions of the Securities and Exchange Board of India (Share Based benefits)
Regulations, 2014 and amendments thereof from time to time.

(ii) During the financial year 2017-18, the NRC in its meeting held on November 10, 2017 has granted 1,38,000
options (before giving effect of sub-division) with a progressive vesting to certain senior management
employees under the ESOS 2017 and the vesting of options will be @15% on 1st anniversary, 20% on 2nd
anniversary, 30% on 3rd anniversary and remaining 35% on 4th anniversary of the grant date. Once vested,
the options remain exercisable for a period of four years.

(iii) During the financial year 2019-20, the NRC in its meeting held on August 1, 2019 has granted 3,18,000
options (before giving effect of sub-division) to certain management cadre employees of the Company
under the ESOS 2017. The options granted vest after completion of one year from the date of grant i.e.
August 1,2020 and the vested options are exercisable for a period of four years after vesting.

(iv) During the financial year 2022-23, the NRC in its meeting held on May 28, 2022 has granted 3,20,000
options (before giving effect of sub-division) to certain management cadre employees of the Company
under the ESOS 2017. The options granted vest after completion of one year from the date of grant i.e. May
28, 2023 and the vested options are exercisable for a period of four years after vesting.

(v) Options are granted under the plan for no consideration and carry no dividend or voting rights until they
are exercised. When exercisable, each option is convertible into one equity share. The exercise price of the
options is fair market price of the share as on date of grant of options.

(vi) The options granted and number of shares mentioned are proportionately increased in accordance sub¬
division of equity shares effective from November 25, 2022. Disclosures have been made after giving effect
to the sub-division of equity shares.

(vii) During the financial year 2024-25, the NRC in its meeting held on May 27, 2024 has granted 3,55,000
options (after giving effect of sub-division) to certain management cadre employees of the Company under
the ESOS 2017. The options granted vest after completion of one year from the date of grant i.e. May 27,
2025 and the vested options are exercisable for a period of four years after vesting.

(e) Fair Value of options granted

The model inputs for options granted on November 10, 2017 included [see Note 38(a)(vi) above]:

(a) options are granted for no consideration and vest upon completions of service for a period of 1-4 years.
Vested options are exercisable for a period of four years after vesting.

(b) exercise price: '' 64.54 per option

(c) grant date: November 10, 2017

(d) expiry date: November 10, 2022 - November 10, 2025

(e) share price at grant date: '' 62.82 per share

(f) expected price volatility of the Company''s shares: 48.32%-51.99%

(g) expected dividend yield: 1.69%

(h) risk free interest rate: 6.51% - 6.91%

The expected price volatility is based on the historic volatility (based on the remaining life of the options) adjusted
for any expected changes to future volatility due to publicly available information.

The model inputs for options granted on August 1,2019 included [see Note 38(a)(vi) above]:

(a) options are granted for no consideration and vest upon completion of service for a period of one year.
Vested options are exercisable for a period of four years after vesting.

(b) exercise price: '' 15.73 per option

(c) grant date: August 1,2019

(d) expiry date: August 1, 2024

(e) share price at grant date: '' 15.73 per share

(f) expected price volatility of the Company''s shares: 42.29%

(g) expected dividend yield: 0%

(h) risk free interest rate: 5.97%

The expected price volatility is based on the historic volatility (based on the remaining life of the options) adjusted
for any expected changes to future volatility due to publicly available information.

The model inputs for options granted on May 28, 2022 included [see Note 38(a)(vi) above]:

(a) options are granted for no consideration and vest upon completion of service for a period of one year.
Vested options are exercisable for a period of four years after vesting.

(b) exercise price: '' 36.20 per option

(c) grant date: May 28, 2022

(d) expiry date: May 28, 2027

(e) share price at grant date: '' 36.20 per share

(f) expected price volatility of the Company''s shares: 4.14%

(g) expected dividend yield: 0%

(h) risk free interest rate: 7.35%

The expected price volatility is based on the historic volatility (based on the remaining life of the options) adjusted
for any expected changes to future volatility due to publicly available information.

Note 39 - Financial risk management

The Company''s business activities exposes it to a variety of financial risks, namely liquidity risk, market risk and
credit risk. The Company''s senior management and key management personnel have the ultimate responsibility for
managing these risks. The Company has a mechanism to identify and analyze the risks faced by the Company, to
set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and
systems are reviewed regularly to reflect changes in market conditions and the Company''s activities.

The Company''s senior management and key management personnel are supported by the finance team and
respective business divisions that provides assurance that the Company''s financial risk activities are governed by
appropriate policies and procedures and that financial risks are identified, measured and managed in accordance
with the Company''s policies and risk objectives. The activities are designed to protect the Company''s financial results
and position from financial risks; and maintain market risks within acceptable parameters, while optimizing returns.

(A) Management of liquidity risk

The principal sources of liquidity of the Company are cash and cash equivalents, borrowings and the cash
flow that is generated from operations. The Company believes that current cash and cash equivalents, tied
up borrowing lines and cash flow that is generated from operations is sufficient to meet requirements. The
Company is cognizant of reputational risk that are associated with the liquidity risk and such risk is factored
into the overall business strategy. Due to the dynamic nature of the underlying businesses, finance department
maintains flexibility in funding by having availability under committed credit lines.

Management monitors rolling forecasts of the Company''s liquidity position (comprising the undrawn borrowing
facilities below) and cash and cash equivalents on the basis of expected cash flows.

* does not include interest payable in future years, since they are repayable on demand and contractual payment to be
made in respect of interest is not accurately determinable considering balances vary based on the fund requirements
of the Company.

(B) Management of market risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in
the price of a financial instrument.

The size and operations of the Company result in it being exposed to the price risk, interest rate risk and foreign
exchange risk that arise from its use of financial instruments.

The above risks may affect income and expenses, or the value of the financial instruments of the Company.
The objective of the Management of the Company for market risk is to maintain this risk within acceptable
parameters, while optimizing returns. The Company''s exposure to and the management of these risks is
explained below:

i) Price risk

The Company is mainly exposed to the price risk due to its investments in equity instruments. The price risk
arises due to uncertainities about the future market values of these investments.

Equity price risk is related to the change in market reference price of the investments in equity securities. In
general, these securities are not held for trading purposes. These investments are subject to changes in the
market price of securities"

Any new investment or divestment must be approved by the Board of Directors and Chief Financial Officer.

a) Price risk sensitivity analysis

As an estimation of the approximate impact of price risk, with respect to investments in equity instruments, the
Company has calculated the impact as follows:

ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because
of changes in market interest rates. The Company''s exposure to risk of changes in market interest rate is limited
to borrowings which bear floating interest rate.

The Company''s fixed rate borrowings are carried at amortized cost. They are therefore not subject to interest
rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate
because of a change in market interest rates.

The Company manages interest rate risk by having a balanced portfolio of fixed and variable rate borrowings. As
at March 31,2025, approximately 52.66% of the Company''s borrowings is at variable rate of interest (March 31,
2024: 54.23%).

The exposure of the Company''s borrowing to interest rate changes at the end of the reporting period is as
follows:

b) Interest rate sensitivity

The exposure of the Company''s borrowings to interest rate changes at the end of the reporting period are
included in the table below. As at the end of the reporting period, the Company had the following exposure on
variable rate borrowings outstanding. Sensitivity is calculated based on the assumption that amount outstanding
as at reporting dates were utilized for the whole financial year:

b) Foreign currency sensitivity

5% is the sensitivity rate used when reporting foreign currency risk and represents management''s assessment
of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding
unhedged foreign currency denominated monetary items and adjusts their translation at the period end for a
5% change in foreign currency rates. The following table demonstrate the sensitivity to a reasonably possible
change in exchange rates, with all other variables held constant. The impact on the Company''s profit before tax,
due to changes in the fair value of monetary assets and liabilities, is as follows:

(C) Management of credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty fails to meet its contractual
obligations.

The Company is exposed to credit risk from its operating activities which primarily includes trade receivables,
security deposits, cash and cash equivalents, deposit with banks and other bank balances. Management has a
credit policy in place and the exposure to credit risk is monitored on an ongoing basis.

Cash and cash equivalents, deposit with banks and other bank balances

Credit risk related to cash and cash equivalent, deposit with banks and other bank balances is managed by
accepting highly rated banks. Management does not expect any losses from non-performance by these
counterparties and the risk of default is negligible or nil.

Other financial assets

Other financial assets measured at amortized cost includes security deposits and other receivables. Credit risk
related to these assets are managed by monitoring the recoverability of such amounts continuously, while at the
same time the internal control system in place ensures that amounts are within defined limits. The Company
evaluates 12 months expected credit losses for all the financial assets (other than trade receivable) for which
credit risk has not increased. In case credit risk has increased significantly, the Company considers lifetime
expected credit losses for the purpose of provisioning (loss allowance).

Financial assets are written off when there is no reasonable expectations of recovery, such as a debtor failing to
engage in a repayment plan with the Company. Where loans or receivables have been written off, the Company
continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are
made, these are recognized as income in the Standalone Statement of Profit and Loss.

Trade receivables

Concentrations of credit risk with respect to trade receivables are limited, due to the customer base being large,
diverse and across sectors and countries. All trade receivables are reviewed and assessed for default on a
quarterly basis.

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

The Company''s assessment is that credit risk in relation to sales made to government customers or sub¬
contractors to government is extremely low as the probability of default is insignificant; therefore the provision
for expected credit losses (ECL) is immaterial in respect of receivables from these customers.

For all non-government customers, the Company has used a practical expedient by computing the expected
credit loss allowance for trade receivables based on a provision matrix by taking into consideration payment
profiles over a period of 36 months before the reporting date and the corresponding historical credit loss
experience within this period. The historical loss rates are adjusted to reflect the current and forward looking
information on macro economic factors affecting the ability of customers to settle receivables. The expected
credit loss is based on aging of days, the receivables due and the expected credit loss rate. Further, the Company
has assessed credit risk on an individual basis in respect of certain customers in case of event driven situation
such as litigations, disputes, change in customer''s credit risk history, specific provision are made after evaluating
the relevant facts and expected recovery.

Note 40 - Capital management

The Company''s objectives when managing capital are to:

- safeguard Company''s ability to continue as a going concern in order to provide returns for shareholders and
benefits for other stakeholders; and

- maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. For achieving this, the
requirement of capital is reviewed periodically with reference to operating and business plans. Apart from internal
accrual, sourcing of capital is done through a judicious combination of equity and borrowing, both short term and
long term. Debt (total borrowings lease liabilities) to equity ratio is used to monitor capital.

(i) Compensated Absences

The employees of the Company are entitled to compensated absences as per the policy of the Company. The entire
amount of the provision of compensated absences is presented as current, since the Company does not have an
unconditional right to defer settlement for the obligation. However, based on past experience, the Company does
not expect all employees to take the full amount of accrued leave or require payment within the next 12 months.
The following amounts reflect leave that is not expected to be taken or paid within the next 12 months.

(ii) Post employment obligations

(a) Defined Contribution Plans

The Company contributes towards Employees State Insurance Scheme, Family Pension Fund, Superannuation
Fund and Provident Fund for certain employees. The contributions are normally based on a certain proportion of
the employee''s salary. During the year, the Company has recognized contribution to these funds aggregating to
'' 4.00 (March 31,2024: '' 4.43) (Refer Note 31).

(b) Defined Benefit Plans
Gratuity

The Company provides for gratuity as per the Company''s scheme or Payment of Gratuity Act, 1972 (last drawn
basic salary per month computed proportionately for 15 days multiplied by number of years of service) whichever
is more beneficial to the employees. As per the Company''s scheme, the amount of gratuity payable on retirement
/ termination is payable to the employees based on last drawn basic salary per month computed proportionately
for 30 / 15 / 30 days (for number of years of service tenure of less than 15 years, more than 15 years but less
than 30 years and more than 30 years, respectively). The benefits vest after five years of continuous service. The
Company has established Fund to which the Company makes contribution for the employees. The Company
does not fully fund the liability and maintains a target level of funding to be maintained over a period of time
based on estimations of expected gratuity payments.

The charge on account of provision for gratuity has been included in ''Employee Benefits Expense'' in the
Standalone Statement of Profit and Loss except remeasurements i.e. actuarial gains and losses and the return
on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability which
are recognized in Other Comprehensive Income.

Provident fund

In respect of certain employees, provident fund contributions are made to a separately administered trust. Such
contribution to the provident fund are charged to the Standalone Statement of Profit and Loss. In case of any
liability arising due to shortfall between the return from its investments and the guaranteed specified interest
rate, the same is provided for by the Company. The actuary has provided an actuarial valuation and the interest
shortfall liability, if any, has been provided in the books of accounts after considering the assets available with
the provident fund trust.

(iv) Risk Exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which
are detailed below:

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.

Asset Volatility: The plan liabilities are calculated using a discount rate set with reference to bond yields; if plan
assets underperform this yield, this will create a deficit.

Salary Inflation Risk: Higher than expected increase in salary will increase the defined benefit obligation.

Interest-Rate Risk: The defined benefit obligation calculated uses a discount rate based on government bonds.
If bond yields fall, the defined benefit obligation will tend to increase.

(v) Defined Benefit Liability and Employer Contributions

Expected contributions to post-employment benefit plans for the year ending March 31,2026 are '' 2.10
The weighted average duration of the defined benefit obligation is 8 years (March 31, 2024: 7 years).

Gautam G. Chakravarti (Non Executive Independent Director)

Sujal A. Shah (Non Executive Independent Director)

Jyotin K. Mehta ( Non Executive Independent Director) (w.e.f October 26, 2024)

Ashutosh S. Bishnoi (Non Executive Independent Director) (w.e.f May 27, 2024)

Abhay R. Jadeja (Non Executive Independent Director) (w.e.f May 27, 2024)

Archana Hingorani (Additional Director) (w.e.f February 04, 2025)

Desh Deepak Khetrapal (Additional Director) (w.e.f February 04, 2025)

C) Relatives of KMP with whom transactions have taken place during the year

Aarti M. Chadha
Anjali K. Agarwal
Rekha H. Mafatlal

D) Individual having control:

H. A. Mafatlal

E) Entity having significant influence:

Sumil Trading Private Limited

F) Entities over which KMP or their relatives have control / significant influence (with whom transactions have
taken place):

NOCIL Limited

N. M. Sadguru Water and Development Foundation
Sri Chaitanya Health and Care Trust
MAF Technologies Private Limited

Pieflowtech Solutions Private Limited (from October 18, 2024) [Refer Note 49(a)]

Sumil Trading Private Limited
Vrata Tech Solutions Private Limited
Vigil Juris (upto August 04, 2024)

Indivar Foundation
Vrata Trading Private Limited
Vrata Ecorenew Energy LLP
Shriaan Trading LLP

H. A. Mafatlal as a Trustee of Gurukripa Trust

H. A. Mafatlal as a Trustee of Karuna Trust

H. A. Mafatlal as a Trustee of Narsingha Trust

H. A. Mafatlal as a Trustee of Shrija Trust

Rekha H. Mafatlal as a Trustee of Radha Raman Trust

Shri H. A. Mafatlal Public Charitable Trust No 1

Seth Navinchandra Mafatlal Foundation Trust No 1

G) Post employment benefit plan:

The Mafatlal Gagalbhai & Sons and the Associate Concerns Officer''s Superannuation Scheme
Mafatlal Industries Limited - Employees Gratuity Fund
Mafatlal Industries Limited - Employees Provident Fund
Mafatlal Denim Limited - Employees Provident Fund**

Mafatlal Denim Limited - Employees Superannuation Fund**

** No transactions during the current and previous year.

In case of Mafatlal Center:

A demand for '' 26.97 (March 31, 2024: '' 26.97) for the period 2008-10 was raised by Brihanmumbai
Mahanagarpalika (''BMC'') towards property taxes in respect of the properties owned by various owners for the
respective floors with respect to increase in ratable value of Municipal taxes. The demand had been challenged
by owners of various floors and during the previous financial year ended March 31, 2024, the concerned
adjudicating authority set aside the aforesaid demand which was challenged and revised the demand to
'' 11.20, which was subsequently paid by the owners of the respective floors. During the current financial year,
the Company has received the No Due Certificate with respect to these dues.

In case of Mafatlal Chambers:

A demand for '' 7.93 (March 31,2024: '' 7.93) for the period 2000-05 has been raised by BMC towards property
taxes in respect of the properties owned by the Company at the relevant time. The said demand has been
disputed by the Company. As per the directions given by the Honorable Bombay High Court, the matter was
heard by BMC in the current year and the said demand was struck off in full. Subsequent to the financial year,
the Company has received the No Due Certificate with respect to these dues.

(b) It is not practicable for the Company to estimate the timing of cash flows, if any, in respect of the above pending
resolution of the respective proceedings. The aforementioned amounts under disputes are as per the demands
from various authorities for the respective periods and has not been adjusted to include further interest and
penalty leviable, if any.

(c) The Company does not expect any reimbursement in respect of the above contingent liabilities.

(d) The Company believes that the ultimate outcome of these proceedings will not have a material adverse effect
on the Company''s financial position and results of operations.

(e) Contingent liability relating to determination of provident fund liability, based on judgment from Hon''ble Supreme
Court, is not determinable at present for the period prior to March, 2019, due to uncertainty of the impact of the
judgment in the absence of further clarification relating to applicability. The Company has paid Provident Fund
to employees as applicable with effect from March 2019. The Company will continue to assess any further
developments in this matter for its implication on the financial statements, if any.

Note 45 - Segment information

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating
Decision Maker ("CODM”) of the Company. The CODM consists of Chairman and Managing Director who are
responsible for allocating resources and assessing performance of the operating segments.

The Company has identified and reported the following business segments:

a) Textile and related products

b) Digital infrastructure

c) Consumer durables and others (from the year ended March 31, 2024)

Segment revenue, expenses and results:

The revenue and expenses which are directly attributable to any business segment are reported under each reportable
segment. The revenue and expenses which are not directly attributable to any business segment are shown as
unallocable expenditure (net of unallocable income, including income from investments and investment properties).
Segment Assets and Liabilities:

Segment assets include all operating assets used by the operating segment and mainly consist of property, plant
and equipment, trade receivables, inventories and other operating assets. Segment liabilities primarily includes trade
payable and other liabilities. Common assets and liabilities which can not be allocated to any of the business segment
are shown as unallocable assets / liabilities.

Note - Information concerning the classification of securities

Options granted to employees under the Mafatlal Employee Stock Option Scheme 2017 (''ESOS 2017'') are considered
to be potential equity shares. They have been included in the determination of diluted earnings per share to the extent
to which they are dilutive. The options have not been included in the determination of basic earnings per share.
Details relating to the options are set out in Note 38.

Note 47 - Government grants

Export Promotion Capital Goods (EPCG): This scheme allows import of certain capital goods including spares at
concessional duty subject to an export obligation for the duty saved on such capital goods. The duty saved on capital
goods imported under EPCG scheme being Government Grant, is accounted as a Capital Grant as stated in the
accounting policy on Government Grants [Refer note 2(B)(iii)].

Technology Upgradation Fund Scheme (TUFS): The Company is entitled to subsidy, on its investment in the property,
plant and equipment, on fulfillment of the conditions stated in the Scheme.

Duty Drawback Scheme: Under Duty drawback scheme, the Company receives certain percentage of export proceeds
as a duty drawback from custom authorities on export of products.

(a) On September 11, 2024 the Board of Directors of the Company approved a strategic investment of '' 0.60 in
Pieflowtech Solutions Private Limited (PSPL), a Subsidiary company representing 60% of the paid-up share
capital of PSPL.

(b) The Board of Directors of the Company at its meeting held on November 14, 2022, approved the scheme of
reduction and reorganization of capital (''Scheme'') pursuant to the provisions of Section 230 and other applicable
provisions of the Companies Act, 2013 which was also subsequently approved by the shareholders and creditors
of the Company with Appointed Date as mentioned in the Scheme as April 01,2022. The National Company Law
Tribunal, Ahmedabad (''NCLT), vide its order dated April 29, 2024 (the ''NCLT order'') had approved the Scheme
with the Appointed Date / Effective Date as March 31, 2024, in respect of which the Company had filed an
interlocutory application on May 06, 2024 seeking modification with a plea to reinstate the Appointed date as
April 01,2022, in accordance with the Scheme filed on October 10, 2023. Accordingly, no accounting effect was
given in the financial statements for the financial year ended March 31,2024, which was further supported by a
legal opinion obtained by the Company. The aforesaid interlocutory application was heard by the NCLT on June
13, 2024, where the Company additionally filed further application seeking change in Appointed Date to March
31,2023. The NCLT vide its order dated June 27, 2024, allowed Appointed date as March 31,2023. Accordingly,
the Company has given the accounting effect to the reserves and surplus balances during the year. (Refer
Note 17)

(i) As legally advised, the Company has not recognized as income recovery of rent and other charges of '' 0.84 upto
March 31,2025 ('' 0.84 upto March 31,2024) pending final resolution of legal dispute with certain ex-tenants of
a property in South Mumbai. At present, the legal dispute is pending with the Hon''ble Bombay High Court. A sum
of '' 5.78 and '' 2.84 was (towards interest accured) withdrawn by the Company in accordance with the Orders
passed by the Hon''ble High Court of Bombay on the Civil Revision Applications filed by the ex-tenants and the
said amount of '' 5.78 and '' 2.84 has been included in other non-current financial liabilities (Refer Note 19).

(ii) In an earlier year, the Company had sold part of its leasehold land at its Mazgaon unit. During prior years, the
Company has surrendered the remaining leasehold land (reserved portion admeasuring about 27,287.82 square
meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of VJ.B. Udyan. The Company
is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the
agreement, the developer will construct a structure and hand it over to the Company.

(iii) Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL)
in 2002, the shareholders of the Company are to be issued one equity share of '' 10/- each (before giving effect
of sub-division), fully paid-up, in SSL for every 500 shares of '' 100/- each, fully paid-up, held in the Company as
consideration for the demerger, aggregating to '' 0.01. As the shareholders of the Company would be entitled to
receive only fractional shares of SSL, the rehabilitation scheme sanctioned by Board for Industrial and Financial
Reconstruction (BIFR) envisages that these shares would be acquired by Navin Fluorine International Limited
(NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof.
The Company has received the said amount of '' 0.01 from NFIL on behalf of the shareholders, which is pending
disbursement upon completion of formalities..

Note 53 - Additional regulatory information required by Schedule III

(i) Details of benami property held

No proceedings have been initiated on or are pending against the Company for holding benami property under
the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

(ii) Wilful defaulter

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

(iii) Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act,
1956.

(iv) Compliance with approved scheme(s) of arrangements

Refer Note 49(b)

(v) Valuation of Property, plant and equipment, intangible asset and investment property

The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible
assets during the current or previous year.

(vi) Utilization of borrowed funds and share premium

The Company has not advanced or loaned or invested funds to any 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

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 entities identified in any manner whatsoever by or on
behalf of the Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries

(vii) Undisclosed income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments
under the Income Tax Act, 1961, that has not been recorded in the books of account.

(viii) Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the current or previous
year.

(ix) Utilization of borrowings availed from banks and financial institutions

The borrowings obtained by the Company from banks and financial institutions have been applied for the
purposes for which such loans were taken.

(x) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013, read with the
Companies (Restriction on number of layers) Rules, 2017.

(xi) Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the
statutory period.

(xii) Borrowing secured against current assets

The Company has borrowings from banks on the basis of security of current assets. The quarterly returns or
statements of current assets filed by the Company with banks and financial institutions are in agreement with
the books of accounts.

Note 54 - Events occurring after reporting period

Refer Note 17(a) for the final dividend recommended by the Board of Directors which is subject to the approval of
shareholders in the ensuing annual general meeting.

Note 55 - The Standalone Financial Statements were authorized for issue by the Board of Directors on May 13, 2025.
The accompanying notes are an integral part of these standalone financial statements.

In terms of our report attached

For Price Waterhouse Chartered Accountants LLP For and on behalf of the Board of Directors

Firm Registration No. 012754N / N500016

Pankaj Khandelia H. A. Mafatlal P H. Mafatlal M. P Shah A. P Shah

Partner Chairman Managing Director Chief Financial Officer Company Secretary

Membership Number: 102022 (DIN: 00009872) (DIN: 02433237) (Membership No. : ACS20622)

Place: Mumbai Place: Mumbai Place: Mumbai Place: Mumbai Place: Mumbai

Date: May 13, 2025 Date: May 13, 2025 Date: May 13, 2025 Date: May 13, 2025 Date: May 13, 2025

---

Mar 31, 2024

xvi. Provisions, contingent liabilities and contingent assets

Provisions are recognized when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. These are reviewed at each reporting period and reflect the best current estimate. Provisions are not recognized for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognized even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flow estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or 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 the obligation or a reliable estimate of the amount cannot be made.

Contingent assets are not recognized in the financial statements unless it is virtually certain that the future event will confirm the asset’s existence and the asset will be realized.

xvii. Employee benefits

(a) Short-term employee benefits

Liabilities for wages and salaries, including

non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognized in respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled.

(b) Other Long-term employee benefits

The liabilities for earned leave is not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service. They are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. The benefits are discounted using the market yields at the end of the reporting period that have terms approximating to the terms of the related obligation. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognized in the Standalone Statement of Profit and Loss.

The obligations are presented as current liabilities in the Standalone Balance Sheet if the entity does not have an unconditional right to defer settlement for at least 12 months after the reporting period, regardless of when the actual settlement is expected to occur.

(c) Post-employment obligations

Defined benefit plans

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on Government bonds that have terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Standalone Statement of Profit and Loss.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognized in the

period in which they occur directly in Other Comprehensive Income. They are included in retained earnings in the Standalone Statement of Changes in Equity and in the Standalone Balance Sheet.

Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognized immediately in profit or loss as past service cost.

Defined Contribution plan

The Company has no further payment obligations once the contributions have been paid. The contributions are accounted for as defined contribution plans and the contributions are recognized as employee benefit expense when they are due. Prepaid contributions are recognized as an asset to the extent that a cash refund or a reduction in the future payments is available.

(d) Share based payments

The fair value of options granted under the Employee Option Plan is recognized as an employee benefits expense with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair value of the options granted:

• including any market performance conditions (e.g. the entity’s share price)

• excluding the impact of any service and non-market performance vesting conditions (e.g. profitability, sales growth targets and remaining an employee of the entity over a specified time period), and

• including the impact of any non-vesting conditions (e.g. the requirement for employees to save or holdings shares for a specific period of time).

The total expense is recognized over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each period, the entity revises its estimates of the number of options that are expected to vest based on the non-market vesting and service conditions. It recognizes the impact of the revision to original estimates, if any, in profit or loss, with a corresponding adjustment to equity.

Where shares are forfeited due to a failure by the employee to satisfy the service conditions, any expenses previously recognized in relation to such shares are reversed effective from the date of the forfeiture.

Refer Note 2A(xiii) for the material accounting policies above relevant to Employee benefits.

xviii. Earnings per share

(a) Basic earnings per share

Basic earnings per share is calculated by dividing:

• the profit attributable to owners of the Company

• by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.

(b) Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:

• the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares, and

• the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares.

xix. Cash flow statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

xx. Contributed equity

Equity shares are classified as equity.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

xxi. Operating cycle

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their realization in cash or cash equivalents, the Company has determined its

operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.

xxii. Exceptional Items

Exceptional items include income or expense that are considered to be part of ordinary activities, however, are of such significance and nature that separate disclosure enables the user of the financial statements to understand the impact in a more meaningful manner. Exceptional items are

identified by virtue of either their size or nature so as to facilitate comparison with prior periods and to assess underlying trends in the financial performance of the Company.

xxiii. Rounding of amounts

All amounts disclosed in the financial statements and notes have been rounded off to the nearest Crores as per the requirement of Schedule III, unless otherwise stated.

Note 38 - Share Based Payments

(a) Employee option plan

(i) The Mafatlal Employee Stock Option Scheme 2017 (''ESOS 2017'') of Mafatlal Industries Limited was approved by the Board of Directors of the Company at their meeting held on May 05, 2017 and finalised on August 10, 2017. At the Annual General Meeting held on August 02, 2017, the shareholders approved the creation of employee stock option pool of 6,95,000 equity shares of face value of '' 10/- each fully paid up (before giving effect of sub-division) on such terms and such manner as the Board may decide in accordance with the provisions of applicable law and ESOS 2017.

The Company has implemented ESOS 2017 with a view to attract and retain key talents working with the Company by way of rewarding their performance and motivate them to contribute to the overall corporate growth and profitability. The Nomination and Remuneration Committee (''NRC'') administers ESOS 2017, in compliance with the provisions of Securities and Exchange Board of India (share based benefits) regulations, 2014 and amendments thereof from time to time.

(ii) During the financial year 2017-18, the NRC in its meeting held on November 10, 2017 has granted 1,38,000 options (before giving effect of sub-division) with a progressive vesting to certain senior management employees under the ESOS 2017 and the vesting of options will be @15% on 1st anniversary, 20% on 2nd anniversary, 30% on 3rd anniversary and remaining 35% on 4th anniversary of the grant date. Once vested, the options remain excerisable for a period of four years.

(iii) During the financial year 2019-20, the NRC in its meeting held on August 01,2019 has granted 3,18,000 options (before giving effect of sub-division) to certain management cadre employees of the Company under the ESOS 2017. The options granted vest after completion of one year from the date of grant i.e. August 01,2020 and the vested options are excercisable for a period of four years after vesting.

(iv) During the financial year 2022-23, the NRC in its meeting held on May 28, 2022 has granted 3,20,000 options (before giving effect of sub-division) to certain management cadre employees of the Company under the ESOS 2017. The options granted vest after completion of one year from the date of grant i.e. May 28, 2023 and the vested options are excercisable for a period of four years after vesting.

(v) Options are granted under the plan for no consideration and carry no dividend or voting rights until they are exercised. When exercisable, each option is convertible into one equity share. The exercise price of the options is fair market price of the share as on date of grant of options.

(vi) The options granted and number of shares mentioned are proportionately increased in accordance with sub-division of equity shares effective from November 25, 2022. Disclosures have been made after giving effect to the sub-division of equity shares. [Refer Note 17(8)].

(e) Fair Value of options granted

The model inputs for options granted on November 10, 2017 included [see note (a)(vi) above]:

(a) options are granted for no consideration and vest upon completions of service for a period of 1-4 years. Vested options are excercisable for a period of four years after vesting.

(b) exercise price: '' 64.54 per option

(c) grant date: November 10, 2017

(d) expiry date: November 10, 2022 - November 10, 2025

(e) share price at grant date: '' 62.82 per share

(f) expected price volatility of the Company’s shares: 48.32%-51.99%

(g) expected dividend yield: 1.69%

(h) risk free interest rate: 6.51% - 6.91%

The expected price volatility is based on the historic volatility (based on the remaining life of the options) adjusted for any expected changes to future volatility due to publicly available information.

The model inputs for options granted on August 01, 2019 included [see note (a)(vi) above]:

(a) options are granted for no consideration and vest upon completion of service for a period of one year. Vested options are excercisable for a period of four years after vesting.

(b) exercise price: '' 15.73 per option

(c) grant date: August 01,2019

(d) expiry date: August 01,2024

(e) share price at grant date: '' 15.73 per share

(f) expected price volatility of the Company’s shares: 42.29%

(g) expected dividend yield: 0%

(h) risk free interest rate: 5.97%

The expected price volatility is based on the historic volatility (based on the remaining life of the options) adjusted for any expected changes to future volatility due to publicly available information.

Note 39 - Financial risk management

The Company’s business activities exposes it to a variety of financial risks, namely liquidity risk, market risks and credit risk. The Company’s senior management and key management personnel have the ultimate responsibility for managing these risks. The Company has a mechanism to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities.

The Company’s senior management and key management personnel are supported by the finance team and respective business divisions that provides assurance that the Company’s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. The activities are designed to protect the Company’s financial results and position from financial risks; and maintain market risks within acceptable parameters, while optimising returns.

(A) Management of liquidity risk

The principal sources of liquidity of the Company are cash and cash equivalents, borrowings and the cash flow that is generated from operations. The Company believes that current cash and cash equivalents, tied up borrowing lines and cash flow that is generated from operations is sufficient to meet requirements. The Company is cognizant of reputational risk that are associated with the liquidity risk and such risk is factored into the overall business strategy. Due to the dynamic nature of the underlying businesses, finance department maintains flexibility in funding by having availability under commited credit lines.

Management monitors rolling forecasts of the Company’s liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows.

(B) Management of market risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument.

The size and operations of the Company result in it being exposed to the price risk, interest rate risk and foreign exchange risk that arise from its use of financial instruments.

The above risks may affect income and expenses, or the value of the financial instruments of the Company. The objective of the Management of the Company for market risk is to maintain this risk within acceptable parameters, while optimising returns. The Company’s exposure to and the management of these risks is explained below:

i) Price risk

The Company is mainly exposed to the price risk due to its investments in equity instruments. The price risk arises due to uncertainties about the future market values of these investments.

Equity price risk is related to the change in market reference price of the investments in equity securities. In general, these securities are not held for trading purposes. These investments are subject to changes in the market price of securities Any new investment or divestment must be approved by the Board of Directors and Chief Financial Officer.

ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to risk of changes in market interest rate is limited to borrowings which bear floating interest rate.

The Company’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in I nd AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates

The Company manages interest rate risk by having a balanced portfolio of fixed and variable rate borrowings. As at March 31, 2024, approximately 54.23% of the Company’s borrowings is at variable rate of interest (March 31,2023: 73.54%).

The exposure of the Company’s borrowing to interest rate changes at the end of the reporting period is as follows:

I n to root rata avnacura

iii) Foreign exchange risk

The Company has international operations and is exposed to foreign exchange risk arising from foreign currency transactions. Foreign exchange risk arises from future commercial transactions and recognized financial assets and liabilities denominated in a currency that is not the functional currency (?) of the Company. The risk also includes highly probable foreign currency cash flows.

The Company is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to USD and AED.

(C) Management of credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty fails to meet its contractual obligations. The Company is exposed to credit risk from its operating activities which primarily includes trade receivables, security deposits, cash and cash equivalent, deposit with banks and other bank balances. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis.

Cash and cash equivalent, deposit with banks and other bank balances

Credit risk related to cash and cash equivalent, deposit with banks and other bank balances is managed by accepting highly rated banks. Management does not expect any losses from non-performance by these counterparties and the risk of default is negligible or nil.

Other financial assets

Other financial assets measured at amortised cost includes security deposits and other receivables. Credit risk related to these assets are managed by monitoring the recoverability of such amounts continuously, while at the same time the internal control system in place ensures that amounts are within defined limits. The Company evaluates 12 months expected credit losses for all the financial assets (other than trade receivable) for which credit risk has not increased. In case credit risk has increased significantly, the Company considers lifetime expected credit losses for the purpose of provisioning (loss allowance).

Financial assets are written off when there is no reasonable expectations of recovery, such as a debtor failing to engage in a repayment plan with the Company. Where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognized as income in the Standalone Statement of Profit and Loss.

Trade receivables

Concentrations of credit risk with respect to trade receivables are limited, due to the customer base being large, diverse and across sectors and countries. All trade receivables are reviewed and assessed for default on a quarterly basis.

(ii) Post employment obligations

(a) Defined Contribution Plans

The Company contributes towards Employees State Insurance Scheme, Family Pension Fund, Superannuation Fund and Provident Fund for certain employees. The contributions are normally based on a certain proportion of the employee''s salary. During the year, the Company has recognized contribution to these funds aggregating to '' 4.43 (March 31,2023: '' 3.90) (Refer Note 31).

(b) Defined Benefit Plans Gratuity

The Company provides for gratuity for employees as per the Company’s scheme or Payment of Gratuity Act, 1972 (last drawn basic salary per month computed proportionately for 15 days multiplied by number of years of service) whichever is more beneficial to the employees. As per the Company''s scheme, the amount of gratuity payable on retirement/termination is payable to the employees based on last drawn basic salary per month computed proportionately for 30 / 15 / 30 days (for number of years of service tenure of less than 15 years, more than 15 years but less than 30 years and more than 30 years, respectively). The benefits vest after five years of continuous service. The Company has established Fund to which the Company makes contribution for the employees. The Company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments.

The charge on account of provision for gratuity has been included in ''Employee Benefits Expense'' in the Standalone Statement of Profit and Loss except remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability which are recognized in other comprehensive income.

Provident fund

In respect of certain employees, provident fund contributions are made to a separately administered trust. Such contribution to the provident fund are charged to the Standalone Statement of Profit and Loss. In case of any liability arising due to shortfall between the return from its investments and the guaranteed specified interest rate, the same is provided for by the Company. The actuary has provided an actuarial valuation and the interest shortfall liability, if any, has been provided in the books of accounts after considering the assets available with the provident fund trust.

(a) The Company is a lessee in respect of the land on which Mafatlal Centre and Mafatlal Chambers is erected. In this regard:

In case of Mafatlal Centre:

A demand for '' 26.97 (March 31, 2023: '' 26.97) for the period 2008-10 was raised by Brihanmumbai Mahanagarpalika (''BMC'') towards property taxes in respect of the properties owned by various owners for the respective floors with respect to increase in ratable value of Municipal taxes. The demand had been challenged by owners of various floors and during the current financial year ended March 31, 2024, the concerned adjudicating authority set aside the aforesaid demand which was challenged and revised the demand to '' 11.20, which was subsequently paid by the owners of the respective floors. The Company is awaiting the final No Objection Certificate from BMC.

In case of Mafatlal Chambers:

A demand for '' 7.93 (March 31,2023: '' 7.93) for the period 2000-05 has been raised by BMC towards property taxes in respect of the properties owned by the Company at the relevant time. The said demand has been disputed by the Company. As per the directions given by the Honourable Bombay High Court, the BMC has granted hearing to the Company and the final outcome is awaited.

(b) It is not practicable for the Company to estimate the timing of cash flows, if any, in respect of the above pending resolution of the respective proceedings. The aforementioned amounts under disputes are as per the demands from various authorities for the respective periods and has not been adjusted to include further interest and penalty leviable, if any.

(c) The Company does not expect any reimbursement in respect of the above contingent liabilities.

(d) The Company believes that the ultimate outcome of these proceedings will not have a material adverse effect on the Company''s financial position and results of operations.

(e) Contingent liability relating to determination of provident fund liability, based on judgement from Hon''ble Supreme Court, is not determinable at present for the period prior to March, 2019, due to uncertainty of the impact of the judgement in the absence of further clarification relating to applicability. The Company has paid Provident Fund to employees as applicable with effect from March 2019. The Company will continue to assess any further developments in this matter for its implication on the financial statements, if any.

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker ("CODM") of the Company. The CODM consists of Chairman and Managing Director who are responsible for allocating resources and assessing performance of the operating segments.

The Company has identified and reported the following business segments:

a) Textile and related products

b) Digital Infrastructure*

c) Consumer Durables and others (from the current year ended March 31,2024)

* Erstwhile known as technology and related products.

Segment revenue and results:

The expenses and income which are not directly attributable to any business segment are shown as unallocable expenditure (net of unallocable income, including income from investments and investment properties).

Segment Assets and Liabilities:

Segment assets include all operating assets used by the operating segment and mainly consist of property, plant and equipment, trade receivables, inventories and other operating assets. Segment liabilities primarily includes trade payable and other liabilities. Common assets and liabilities which can not be allocated to any of the business segment are shown as unallocable assets / liabilities.

(a) During the previous year ended March, 31 2023, the Board of Directors of the Company approved the divestment of its investment in Vrata Tech Solutions Private Limited (VTS), a Subsidiary company representing 77.78% of the paid-up share capital of VTS. As a result, a Share Purchase Agreement was entered on June 20, 2022 with a promoter group company (Sumil Trading Private Limited) for the total consideration of '' 4.07 (based on fair value of equity share of VTS carried-out by the independent valuer) which was concluded on June 30, 2022. Subsequent to this transaction, VTS ceased to be a subsidiary of the Company with effect from June 30, 2022.

(b) The Board of Directors of the Company at its meeting held on November 14, 2022 approved the scheme of reduction and reorganization of capital (''Scheme'') pursuant to the provisions of Section 230 and other applicable provisions of the Companies Act, 2013 which was also subsequently approved by the shareholders and creditors of the Company with Appointed Date as mentioned in the Scheme as April 01,2022. The National Company Law Tribunal, Ahmedabad (''NCLT''), vide its order dated April 29, 2024 (the ''NCLT order’) has approved the Scheme with the Appointed Date / Effective Date as March 31,2024, against which the Company has filed an interlocutory application on May 06, 2024 seeking modification with a plea to reinstate the Appointed date of April 01,2022 in the NCLT order, in accordance with the Scheme filed on October 10, 2023. The NCLT order with respect to the interlocutory application is awaited. The Company proposes to give the accounting effect prescribed in the Scheme on receiving the approval for the aforesaid interlocutory application from the NCLT which is supported by a legal opinion obtained by the Company.

Note 50

(i) As legally advised, the Company has not recognized as income recovery of rent and other charges of '' 0.84 upto March 31, 2024 ('' 0.84 upto March 31, 2023) pending final resolution of legal dispute with certain ex-tenants of a property in South Mumbai. At present, the legal dispute is pending with the Hon''ble Bombay High Court. A sum of '' 5.78 and '' 2.84 was (towards interest accured) withdrawn by the Company in accordance with the Orders passed by the Hon''ble High Court of Bombay on the Civil Revision Applications filed by the ex-tenants and the said amount of '' 5.78 and '' 2.84 has been included in other non-current liabilities (Refer Note 20).

(ii) I n an earlier year, the Company had sold part of its leasehold land at its Mazgaon unit. During prior years, the Company has surrendered the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of VJ.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the agreement, the developer will construct a structure and hand it over to the Company.

(iii) Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL) in 2002, the shareholders of the Company are to be issued one equity share of '' 10/- each (before giving effect of sub-division), fully paid-up, in SSL for every 500 shares of '' 100/- each, fully paid-up, held in the Company as consideration for the demerger, aggregating to '' 0.01. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the rehabilitation scheme sanctioned by BIFR envisages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of '' 0.01 from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

Note 53 - Additional regulatory information required by Schedule III

(i) Details of benami property held

No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

(ii) Wilful defaulter

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

(iii) Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

(iv) Compliance with approved scheme(s) of arrangements

Refer Note 49(b)

(v) Valuation of Property, plant and equipment, intangible asset and investment property

The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets during the current or previous year.

(vi) Utilization of borrowed funds and share premium

The Company has not advanced or loaned or invested funds to any 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

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 entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries

(vii) Undisclosed income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

(viii) Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

(ix) Utilization of borrowings availed from banks and financial institutions

The borrowings obtained by the Company from banks and financial institutions have been applied for the purposes for which such loans were taken.

(x) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013, read with the Companies (Restriction on number of layers) Rules, 2017.

(xi) Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

(xii) Borrowing secured against current assets

The Company has borrowings from banks on the basis of security of current assets. The quarterly returns or statements of current assets filed by the Company with banks and financial institutions are in agreement with the books of accounts.

Note 54 - The Standalone Financial Statements were authorised for issue by the Board of Directors on May 27, 2024.

The accompanying notes are an integral part of these standalone financial statements.

In terms of our report attached

For Price Waterhouse Chartered Accountants LLP For and on behalf of the Board of Directors

Firm Registration No. 012754N / N500016

Pankaj Khandelia H. A. Mafatlal P. H. Mafatlal M. P. Shah A. P. Shah

Partner Chairman Managing Director Chief Financial Officer Company Secretary

Membership Number: 102022 (DIN: 00009872) (DIN: 02433237)

Place: Mumbai Place: Mumbai Place: Mumbai Place: Mumbai Place: Mumbai

Date: May 27, 2024 Date: May 27, 2024 Date: May 27, 2024 Date: May 27, 2024 Date: May 27, 2024

---

Mar 31, 2023

a) Finance leases

Investment properties include land portions taken on lease by the Company for a period upto 99 years with an option to extend the lease by another 99 years on expiry of lease. However, the Company has no specific obligation towards renewal of lease. The Company has considered that such a lease of land transfers substantially all of the risks and rewards incidental to ownership of land, and has thus accounted for the same as finance lease.

Estimation of fair value

The fair valuation is based on current prices in the active market for similar properties. The main inputs used are quantum, area, location, demand, rental growth rates, expected vacancy rates, terminal yields and discount rates. All resulting fair value estimates for investment properties are included in level 3. The Company obtains independent valuations from registered valuers for its investment properties annually.

(v) mpany is in the process of getting expired lease renewed in respect of the Lower Parel land with gross and net book

value of '' 0.08 (March 31,2022: '' 0.08).

Amounts recognized in the Standalone Statement of Profit and Loss:

Inventory write downs / write back are accounted, considering the nature of inventory, ageing and net realizable value. Write-back of inventories amounted to '' 14.13 (March 31,2022: '' 191.36), out of which '' NIL (March 31,2022: '' 67.46) transferred to exceptional items which is disclosed in the Note 35. Remaining amounts were recognized as an expense / write back during the year and included in ''changes in value of inventories of work-in-progress, stock-in-trade and finished goods’ in the Standalone Statement of Profit and Loss.

Transferred receivables:

The carrying amounts of the trade receivables include receivables which are subject to a discounting arrangement. Under this arrangement, the Company has transferred the relevant receivables to the factor in exchange for cash and is prevented from selling or pledging the receivables. However, the Company has retained late payment and credit risk. The Company therefore continues to recognise the transferred assets in their entirety in its Standalone Balance Sheet. The amount repayable under the discounting is presented as secured borrowing.

(2) Terms and rights attached to Equity shares:

The Company has issued only one class of equity shares having a par value of '' 2/- per share # (March 31,2022: '' 10/- per share). Every holder of equity shares is entitled to 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 the shareholders at the Annual General Meeting except for interim dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts in proportion to their shareholding.

(5) Aggregate number of shares issued for consideration other than cash:

(i) There have been no shares allotted as fully paid up pursuant to contract without payment being received in cash or allotted as fully paid up by way of bonus shares or bought back, for the period of five years immediately preceding the date as at which the Standalone Balance Sheet is prepared.

(ii) Shares reserved for issue under options:

Information relating to Mafatlal Industries Limited Employee Option Plan, including details of options issued, granted, vested and exercised during the financial year and options outstanding at the end of the reporting period, is set out in Note 38.

(7) During 1987-88: 5,35,000 shares (of '' 100/- each) were allotted on rights basis subject to the result of suit nos. 3,181 and 3,182 of 1987 filed by three shareholders against the Company and Others in the Ahmedabad City Civil Court. The suits are pending disposal.

# The Board of Directors at its meeting held on September 17, 2022, recommended a proposal for sub-division of 1 equity share of the Company having a face value of '' 10/- each into 5 equity shares having a face value of '' 2/- each. The same was approved by the shareholders of the Company on November 7, 2022 through postal ballot ("e-voting"). The Company had fixed November 25, 2022 as the record date for such sub-division and completed the process of allotment of the new equity shares having face value of '' 2/- each on November 25, 2022.

Note (i): During the financial year ended March 31, 2021, the Company had entered into a Memorandum of Understanding (MOU) with Workers’ Union at its Nadiad location to reduce its workforce and accordingly recognized expenses towards compensation payable as full and final settlement to its workers who accepted the offer and disclosed the same as an exceptional item. The aforesaid MOU has been terminated in the previous year and therefore there is no further compensation payable under the said MOU.

Note (ii): The Company during the current year has recognized '' 53.57 as expense towards compensation payable as full and final settlement to its certain workers at Navsari location, which has been disclosed as an exceptional item.

Note (iii): The Company had estimated and recognized an impairment loss against carrying value of receivables and inventories in the previous year, owing to Covid-19 related uncertainties and disclosed the same under exceptional item during the previous year.

36(c) - The Taxation Laws (Amendment) Ordinance, 2019 (''ordinance’) introduced section 115BAA of the Income-tax Act, 1961 which allowed domestic Companies to opt for an alternative tax regime from financial year 2019-20. As per the said tax regime, Companies are allowed to pay reduced income tax @ 22% (plus surcharge and cess) subject to foregoing of certain exemptions / deductions which were allowed earlier. Pursuant to the aforesaid amendment, the Company, has opted for lower rate of tax with effect from financial year ended March 31, 2023. Further the Company has restated the deferred tax assets and liabilities as on April 01,2022 at the rate of 25.168%. Accordingly the Company has also reduced the effect of such exemptions/deductions from accumulated losses and have forgone the Minimum Alternate Tax (''MAT’) credit available earlier as a condition precedent for opting for alternative tax regime under the aforesaid mentioned section of the Income Tax Act, 1961.

36(d) - No aggregate amounts of current and deferred tax have arizen in the reporting periods which have been recognized in Equity and not in Standalone Statement of Profit and Loss or Other comprehensive income.

The Company has recognized the deferred tax asset on unabsorbed depreciation of earlier years, loss allowance on trade receivables and deposits and disallowances under Section 35DDA, 40(a)(i) and 43B of the Income Tax Act, 1961. The Company has concluded that the deferred tax assets will be recoverable partially compensated by decrease in deferred tax liabilities and excess will be recovered using estimated future taxable income. Further, unabsorbed depreciation can be carried forward for infinite period as per tax regulations.

36(g) - Unrecognized temporary differences

The Company has not recognized deferred tax asset / (liability) associated with fair value gains on equity instruments measured at FVOCI as based on the management projection of future taxable income and existing plan, it is not probable that such difference will reverse in the foreseeable future.

Note 37 - Fair value measurements

(i) Financial Instrument by category and hierarchy

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

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

- Fair value of cash and bank balances, trade receivables, current loans, trade payables, current borrowings and other current financial assets and liabilities approximate their carrying amounts largely due to short term maturities of these instruments.

- Financial instruments with fixed and variable interest rates are evaluated by the Company based on parameters such as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances are taken to account for expected losses of these receivables. Accordingly, fair value of such instruments is not materially different from their carrying amounts.

- The interest rate on term deposits is at the prevailing market rates. Accordingly, fair value of such instrument is not materially different from their carrying amounts.

- The interest rate on borrowing is at the prevailing market rates. Accordingly, fair value of such instruments is not materially different from their carrying amounts.

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

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

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximize 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: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in level 3.

(ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

- the use of quoted market prices for quoted shares and mutual funds

- the fair value of the other unquoted equity investments is mainly pertaining to investments in co-operative banks which are carried at amortized cost and the carrying amounts are equal to the fair values.

Note 38 - Share Based Payments

(a) Employee option plan

(i) The Mafatlal Employee Stock Option Scheme 2017 (''ESOS 2017'') of Mafatlal Industries Limited was approved by the Board of Directors of the Company at their meeting held on May 05, 2017 and finalised on August 10, 2017. At the Annual General Meeting held on August 02, 2017, the shareholders approved the creation of employee stock option pool of 6,95,000 equity shares of face value of '' 10/- each fully paid up (before giving effect of sub-division) on such terms and such manner as the Board may decide in accordance with the provisions of applicable law and ESOS 2017.

The Company has implemented ESOS 2017 with a view to attract and retain key talents working with the Company by way of rewarding their performance and motivate them to contribute to the overall corporate growth and profitability. The Nomination and Remuneration Committee (''NRC'') administers ESOS 2017.

(ii) During the financial year 2017-18, the NRC in its meeting held on November 10, 2017 has granted 1,38,000 options (before giving effect of sub-division) with a progressive vesting to certain senior management employees under the ESOS 2017 and the vesting of options will be @15% on 1st anniversary, 20% on 2nd anniversary, 30% on 3rd anniversary and remaining 35% on 4th anniversary of the grant date. Once vested, the options remain excerisable for a period of four years.

(iii) During the financial year 2019-20, the NRC in its meeting held on August 01,2019 has granted 3,18,000 options (before giving effect of sub-division) to certain management cadre employees of the Company under the ESOS 2017. The options granted vest after completion of one year from the date of grant i.e. August 01,2020 and the vested options are excercisable for a period of four years after vesting.

(iv) During the current year, the NRC in its meeting held on May 28, 2022 has granted 3,20,000 options (before giving effect of sub-division) to certain management cadre employees of the Company under the ESOS 2017. The options granted vest after completion of one year from the date of grant i.e. May 28, 2023 and the vested options are excercisable for a period of four years after vesting.

(v) Options are granted under the plan for no consideration and carry no dividend or voting rights until they are exercised. When exercisable, each option is convertible into one equity share. The exercise price of the options is fair market price of the share as on date of grant of options.

(vi) The options granted and number of shares mentioned are proportionately increased in accordance with sub-division of equity shares effective from November 25, 2022. Disclosures for March 31,2023 and March 31,2022 have been made after giving effect to the sub-division of equity shares. [Refer Note 18(a)#].

(c) The weighted average share price at the dates of exercise of the options exercised during the year ended March 31,2023 was '' 52.58 (March 31,2022 - '' 35.48).

Note 39 - Financial risk management

The Company’s business activities exposes it to a variety of financial risks, namely liquidity risk, market risks and credit risk. The Company’s senior management and key management personnel have the ultimate responsibility for managing these risks. The Company has a mechanism to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities.

The Company’s senior management and key management personnel are supported by the finance team and respective business divisions that provides assurance that the Company’s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. The activities are designed to protect the Company’s financial results and position from financial risks; and maintain market risks within acceptable parameters, while optimising returns.

(A) Management of liquidity risk

The principal sources of liquidity of the Company are cash and cash equivalents, borrowings and the cash flow that is generated from operations. The Company believes that current cash and cash equivalents, tied up borrowing lines and cash flow that is generated from operations is sufficient to meet requirements. The Company is cognizant of reputational risk that are associated with the liquidity risk and such risk is factored into the overall business strategy. Due to the dynamic nature of the underlying businesses, finance department maintains flexibility in funding by having availability under commited credit lines.

Management monitors rolling forecasts of the Company’s liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows.

(C) Management of credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty fails to meet its contractual obligations. The Company is exposed to credit risk from its operating activities which primarily includes trade receivables, security deposits and deposits with banks. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis.

Cash and cash equivalent, deposit with banks and other bank balances

Credit risk related to cash and cash equivalent, deposit with banks and other bank balances is managed by accepting highly rated banks. Management does not expect any losses from non-performance by these counterparties.

Trade receivables

Concentrations of credit risk with respect to trade receivables are limited, due to the customer base being large, diverse and across sectors and countries. All trade receivables are reviewed and assessed for default on a quarterly basis.

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

i) Actual or expected significant adverse changes in business,

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

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

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

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

In furtherance to above, the Company has assessed the impact of the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognized in respect of trade receivables. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the micro economic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue. Further, the Company has assessed credit risk on an individual basis in respect of certain customers [Also refer note (a) below].

Other financial assets

Other financial assets measured at amortized cost includes security deposits and other receivables. Credit risk related to these assets are managed by monitoring the recoverability of such amounts continuously, while at the same time the internal control system in place ensures that amounts are within defined limits. The Company has a diversified portfolio of investment with various number of counterparties which have secure credit ratings, hence the risk is reduced. Individual risk limits are set for each counterparty based on financial position, credit rating and past experience. Credit limits and concentration of exposures are actively monitored by the treasury department of the Company.

Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a repayment plan with the Company. Where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognized as income in the Standalone Statement of Profit and Loss.

Note 40 - Capital Management

The Company’s objectives when managing capital are to:

- safeguard Company’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholder;

- maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

Consistent with others in the industry, the Company monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including ''current and non-current borrowings’ and lease liabilities as shown in the Standalone Balance Sheet) less cash and cash equivalents and other bank balances. Total capital is calculated as ''equity’ as shown in the Balance Sheet.

(i) Compensated Absences

The employees of the Company are entitled to compensated absences as per the policy of the Company. The entire amount of the provision of compensated absences is presented as current, since the Company does not have an unconditional right to defer settlement for the obligation. However, based on past experience, the Company does not expect all employees to take the full amount of accrued leave or require payment within the next 12 months. The following amounts reflect leave that is not expected to be taken or paid within the next 12 months.

(ii) Post employment obligations

(a) Defined Contribution Plans

The Company contributes towards Employees State Insurance Scheme, Family Pension Fund, Superannuation Fund and Provident Fund for certain employees. The contributions are normally based on a certain proportion of the employee''s salary. During the year, the Company has recognized contribution to these funds aggregating to '' 389.84 (March 31,2022: '' 303.02) (Refer Note 31).

(b) Defined Benefit Plans Gratuity

The Company provides for gratuity for employees as per the Company policy. The amount of gratuity payable on retirement/ termination is payable to the employees based on last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The Company has established Fund to which the Company makes contribution for the employees. The contributions are made based upon actuarial valuation done at the year end of every financial year using "Projected Unit Credit" method. The charge on account of provision for gratuity has been included in ''Employee Benefits Expense’ in the Standalone Statement of Profit and Loss except remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability which are recognized in other comprehensive income.

Provident fund

In respect of certain employees, provident fund contributions are made to a separately administered trust. Such contribution to the provident fund are charged to the Standalone Statement of Profit and Loss. In case of any liability arising due to shortfall between the return from its investments and the guaranteed specified interest rate, the same is provided for by the Company.

The actuary has provided an actuarial valuation and the interest shortfall liability, if any, has been provided in the books of accounts after considering the assets available with the provident fund trust.

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 as when calculating the defined benefit liability recognized in the Standalone Balance Sheet. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.

(iv) Risk Exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

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.

Asset volatility: The plan liabilities are calculated using a discount rate set with reference to bond yields; if plan assets underperform this yield, this will create a deficit.

Salary Inflation Risk: Higher than expected increases in salary will increase the defined benefit obligation.

Interest-Rate Risk: The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yield falls, the defined benefit obligation will tend to increase.

(v) Defined Benefit Liability and Employer Contributions

Expected contributions to post-employment benefit plans for the year ending March 31,2024 are '' 210.92.

The weighted average duration of the defined benefit obligation is 7 years (March 31,2022: 8 years).

The expected maturity analysis of undiscounted gratuity is as follows:

(b) The Company is a lessee in respect of the land on which Mafatlal Centre and Mafatlal Chambers is erected. In this regard In case of Mafatlal Centre:

A demand for '' 2,696.98 (March 31,2022: '' 2,696.98) for the period from 2004-07 and 2008-10 was raised by Brihanmumbai Mahanagarpalika (''BMC'') towards property taxes in respect of the properties owned by various owners for the respective floors. The demand has been challenged by owners of various floors at appropriate forum and the matter is subjudice. In case the demand is finally upheld, the amount will be paid by the concerned co-owners and the Company will have no additional liability.

In case of Mafatlal Chambers:

A demand for '' 792.46 (March 31,2022: '' 792.46) for the period 2000-05 has been raised by BMC towards property taxes in respect of the properties owned by the Company at the relevant time. The said demand has been disputed by the Company. As per the directions given by the Honourable Bombay High Court, the BMC has granted hearing to the Company and the final outcome is awaited.

(c) It is not practicable for the Company to estimate the timing of cash flows, if any, in respect of the above, pending resolution of the respective proceedings.

(d) The Company does not expect any reimbursement in respect of the above contingent liabilities.

(e) The Company believes that the ultimate outcome of these proceedings will not have a material adverse effect on the Company’s financial position and results of operations.

(f) Contingent liability relating to determination of provident fund liability, based on judgement from Hon''ble Supreme Court, is not determinable at present for the period prior to March, 2019, due to uncertainty of the impact of the judgement in the absence of further clarification relating to applicability. The Company has paid Provident Fund to employees as applicable with effect from March 2019. The Company will continue to assess any further developments in this matter for its implication on the financial statements, if any.

Note 45 - Segment information

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker ("CODM") of the Company. The CODM consists of Chairman and Managing Director who are responsible for allocating resources and assessing performance of the operating segments.

Upto the previous year, the Company had identified ''Textile and related product'' as its only primary reportable segment in accordance with the requirements of Ind AS 108, ''Operating Segments’. Accordingly, no separate segment information has been provided for the previous year. During the current year, the Company has identified and reported the following business segments:

a) Textile and related products, and

b) Technology and related products.

Segment revenue and results

The expenses and income which are not directly attributable to any business segment are shown as unallocable expenditure (net of allocable income, including income from investments and investment properties).

Segment Assets and Liabilities

Segment assets include all operating assets used by the operating segment and mainly consist of property, plant and equipment, trade receivables, inventories and other operating assets. Segment liabilities primarily includes trade payable and other liabilities. Common assets and liabilities which cannot be allocated to any of the business segment are shown as unallocable assets / liabilities.

(ii) Entity wide disclosure

The Company is domiciled in India. The amount of its revenue from external customers broken down by location of the customers is shown in the table below:

Note (a) - Information concerning the classification of securities

Options granted to employees under the Mafatlal Employee Stock Option Scheme 2017 (''ESOS 2017'') are considered to be potential equity shares. They have been included in the determination of diluted earnings per share to the extent to which they are dilutive. The options have not been included in the determination of basic earnings per share. Details relating to the options are set out in Note 38.

Note (b) - Sub-division of equity shares

Pursuant to the approval of the shareholders through postal ballot ("e-voting") dated November 07, 2022, 1 equity share of the Company having a face value of '' 10/- each was sub-divided into 5 equity shares having a face value of '' 2/- each with effect from the record date, i.e., November 25, 2022. Consequently, the basic and diluted earnings per share have been computed for all the periods presented in the Standalone Financial Statements of the Company on the basis of the new number of equity shares in accordance with Ind AS 33 - Earnings per Share.

Export Promotion Capital Goods (EPCG): This scheme allows import of certain capital goods including spares at concessional duty subject to an export obligation for the duty saved on such capital goods. The duty saved on capital goods imported under EPCG scheme being Government Grant, is accounted as a Capital Grant as stated in the accounting policy on Government Grants (Refer note 2).

Technology Upgradation Fund Scheme (TUFS): The Company is entitled to subsidy, on its investment in the property, plant and equipment, on fulfilment of the conditions stated in the Scheme.

Duty Drawback Scheme: Under Duty drawback scheme, the Company receives certain percentage of export proceeds as a duty drawback from custom authorities on export of products.

The Government Grants above represents unamortised amount of the subsidy referred below, with the corresponding adjustment to the carrying amount of property, plant and equipment [Refer note 3(a)].

(a) During the year, the Board of Directors of the Company approved the divestment of its investment in Vrata Tech Solutions Private Limited (VTS), a Subsidiary company representing 77.78% of the paid-up share capital of VTS. As a result, a Share Purchase Agreement was entered on June 20, 2022 with a promoter group company (Sumil Trading Private Limited) for the total consideration of '' 407.48 (based on fair value of equity share of VTS carried-out by the independent valuer) which was concluded on June 30, 2022. Subsequent to this transaction, VTS ceased to be a subsidiary of the Company with effect from June 30, 2022.

(b) The Board of Directors of the Company at its meeting held on November 14, 2022, has approved the scheme of arrangement for capital reduction and reorganization pursuant to the provisions of Section 230 and other applicable provisions of the Companies Act, 2013. The scheme will be given effect to on receipt of requisite approvals.

Note - 50

(i) As legally advised, the Company has not recognized as income recovery of rent and other charges of '' 83.61 upto March 31, 2023 ('' 83.61 upto March 31, 2022) pending final resolution of legal dispute with certain ex-tenants of a property in South Mumbai. At present, the legal dispute is pending with the Hon’ble Bombay High Court. A sum of '' 577.89 (Net) was withdrawn by the Company in accordance with the Orders passed by the Hon’ble High Court of Bombay on the Civil Revision Applications filed by the ex-tenants and the said amount of '' 577.89 has been included in other non-current liabilities (Refer Note 20).

(ii) I n an earlier year, the Company had sold part of its leasehold land at its Mazgaon unit. During prior years, the Company has surrendered the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of V.J.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the agreement, the developer will construct a structure and hand it over to the Company.

(iii) Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL) in 2002, the shareholders of the Company are to be issued one equity share of '' 10 each (before giving effect of sub-division), fully paid-up,

in SSL for every 500 shares of '' 100/- each, fully paid-up, held in the Company as consideration for the demerger, aggregating to '' 1.00. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the rehabilitation scheme sanctioned by BIFR envizages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of '' 1.00 from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

(iv) During the financial year ended March 31, 2019, the Company had filed a review petition against the Order of Honourable Bombay High Court partially allowing the Writ petition No. 2982 of 2016 filed by the Company, in so far as it related to rejection of the claim of the Company for non-cash compensation benefit (TDR) against surrender of a part of land at Mazgaon (reserved land) to Municipal Corporation of Greater Mumbai (MCGM). Subsequent to year-end, the said review petition was dismissed by the Honourable Bombay High Court on April 20, 2023. The Company is in the process of obtaining legal advice on this matter and shall take necessary action accordingly.

Note 53 - Additional regulatory information required by Schedule III

(i) Details of benami property held

No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions(Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

(ii) Wilful defaulter

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

(iii) Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

(iv) Compliance with approved scheme(s) of arrangements

The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year. [Also refer Note 49(b)]

(v) Valuation of Property, plant and equipment, intangible asset and investment property

The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets during the current or previous year.

(vi) Utilization of borrowed funds and share premium

The Company has not advanced or loaned or invested funds to any 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

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 entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries

(vii) Undisclosed income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

(viii) Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

(ix) Utilization of borrowings availed from banks and financial institutions

The borrowings obtained by the Company from banks and financial institutions have been applied for the purposes for which such loans were taken.

(x) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013, read with the Companies (Restriction on number of layers) Rules, 2017.

(xi) Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

(xii) Borrowing secured against current assets

The Company has borrowings from banks on the basis of security of current assets. The quarterly returns or statements of current assets filed by the Company with banks and financial institutions are in agreement with the books of accounts.

Note 54 - Previous year’s figures have been regrouped / reclassified wherever necessary to correspond with the current year’s classifications / disclosures.

Note 55 - The Standalone Financial Statements were authorised for issue by the Board of Directors on May 30, 2023.

The accompanying notes are an integral part of these standalone financial statements.

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Mar 31, 2018

Notes forming part of the Standalone Financial Statements as at and for the year ended March 31, 2018

(All amounts in Rs. Lakhs, unless stated otherwise)

A. Exemptions and exceptions availed

In preparing these Ind AS financial statements, the Company has availed certain optional exemptions and mandatory exceptions in accordance with Ind AS 101 from previous GAAP to Ind AS, as explained below. The resulting difference between the carrying values of the assets and liabilities in the financial statements as at the transition date under Ind AS and previous GAAP have been recognised directly in equity (retained earnings or another appropriate category of equity). This note explains the adjustments made by the Company in restating its previous GAAP financial statements as at April 01, 2016 and the financial statements as at and for the year ended March 31, 2017.

A.1 Ind AS optional exemptions

(a) Business combinations

Ind AS 101 provides the option to apply Ind AS 103 prospectively from the transition date or from a specific date prior to the transition date. This provides relief from full retrospective application that would require restatement of all business combinations prior to the transition date.

The Company elected to apply Ind AS 103 prospectively to business combinations occurring after its transition date. Business combinations occurring prior to the transition date have not been restated.

(b) Investments in subsidiaries, associates and joint ventures

Ind AS 101 permits a first time adopter to measure it''s investment, at the date of transition, at cost determined in accordance with Ind AS 27, '' Separate Financial Statements'' or deemed cost. The deemed cost of such investment shall be it''s fair value at the Company''s date of transition to Ind AS, or previous GAAP carrying amount at that date. The Company has elected to measure its investment in subsidiary at the previous GAAP carrying amount as its deemed cost on the transition date.

(c) Deemed cost for property plant and equipment, intangible assets and investment properties

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets'' and investment properties covered by Ind AS 40 Investment Property''. Accordingly, the Company has elected to measure all of its property, plant and equipment, intangible assets and investment properties at their previous GAAP carrying value.

(d) Designation of previously recognised financial instruments

Ind AS 101 allows an entity to designate investments in equity instruments at FVOCI on the basis of the facts and circumstances at the date of transition to Ind AS. The Company has elected to apply this exemption for its investment in equity shares.

A.2. Ind AS mandatory exceptions (a) Estimates

An entity''s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. Ind AS estimates as at April 01, 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 FVPL or FVOCI;

• Impairment of financial assets based on expected credit loss model;

• Fair Value of investment properties;

• Asset held for sale

(b) Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS. Consequently the Company has appplied the above assessment based on facts and circumstances exisiting on the transition date.

(c) Derecognition of Financial Assets and Financial Liabilities:

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accounting for those transactions. The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

B. Reconciliations between previous GAAP and Ind AS

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following reconciliations provide the explanations and quantification of the differences arising from the transition from previous GAAP to Ind AS in accordance with Ind AS 101:

A. Reconciliation of Equity as at April 01, 2016 and March 31, 2017;

B. Reconciliation of Statement of Total Comprehensive Income for the year ended March 31, 2017; and

C. The impact on cash flows from operating, investing and financing activities for the year March 31, 2017. Reconciliation of total equity as at April 01, 2016 and March 31, 2017:

Description	Notes to first time adoption	April 01, 2016	March 31, 2017
Total equity (shareholders'' funds) as per previous GAAP		37,755.08	37,540.55
Adjustments:
Proposed dividend and dividend distribution tax	1	502.36	-
Fair valuation of Investments	3	9,401.61	22,260.89
Deferred revenue on government grant	4	4,113.25	4,705.58
Depreciation on government grant	4	(4,102.21)	(4,650.87)
Others	13	(832.31)	(901.95)
Deferred tax impact in respect of Ind AS adjustments	6	2.94	(3.03)
Total adjustments		9,085.64	21,410.62
Total equity as per Ind AS		46,840.72	58,951.17

Reconciliation of total comprehensive income for the year ended March 31, 2017:

Description	Notes to first time adoption	March 31, 2017
Profit after tax as previous GAAP		(214.53)
Adjustments:
Net impact on Investment-Fair Value Option through P&L	3	643.39
Deferred revenue on government grant	4	592.33
Depreciation on government grant	4	(548.66)
Acturial (Loss)/ Gain on Defined Benefit Plans considered under Other Comprehensive	5	23.67
Income

Description	Notes to first time adoption	March 31, 2017
Others	13	(69.64)
Deferred tax impact in respect of Ind AS adjustments	6	(14.16)
Total adjustments		626.93
Profit after tax as per Ind AS		412.40
Other comprehensive income		12,200.41
Total comprehensive income as per Ind AS		12,612.81

Cash Flow Reconciliation
Description	Notes	GAAP	Adjustments	Ind .AS
Net cash from operating activities		1,851.89	6,942.10	8,793.99
Net cash from investing activities		(564.82)	(6,703.85)	(7,268.67)
Net cash from financing activities		(1,110.56)	(10.79)	(1,121.35)
Net increase / decrease in cash equivalents		176.51	227.46	403.97
Cash and cash equivalents as at April 01, 2016	13	574.31	-	574.31
Cash and cash equivalents as at March 31, 2017	13	750.82	227.46	978.28

Notes to first time adoption:

The following explains the material adjustments made while transition from previous accounting standards to Ind AS: Note 1:- 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 of Rs 502.36 lakhs as at April 01, 2016 included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount.

Note 2:- Trade Receivables

As per Ind AS 109, the Company is required to apply expected credit loss model for recognising the allowance for doubtful debts. After the analysis of ageing of debtors, the Company has concluded that the existing amount of provision in the books is sufficient to cover any doubtful debt / s arising in future. As a result, no allowance for doubtful debts has been recognised by application of expected credit loss model for any of the years considered above.

Note 3:- Fair Valuation of Investments

Under the previous GAAP, investments in equity instruments and bonds instruments 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 Profit or Loss for the year ended March 31, 2017. This increased the retained earnings by Rs. 706.20 lakhs as at March 31, 2017 (April 01, 2016 - Rs. 2,540.48 Lakhs). Fair value changes with respect to investments in equity instruments designated as at FVOCI have been recognised in other comprehensive income as at the date of transition and subsequently in the other comprehensive income for the year ended March 31 2017. This increased other reserves by Rs.12,215.89 lakhs as at March 31, 2017 (April 01, 2016 - Rs. 6,861.00 Lakhs). Consequent to the above, the total equity as at March 31, 2017 increased by Rs. 12,922.09 Lakhs (April 01,2016 - Rs. 9,401.48 Lakhs).

Note 4:- Deferred Government Grant

As stated above, on transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment recognised as at April 01, 2016, measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment. However, in view of the Ind AS Transition Facilitation Company (ITFG) clarification bulletin dated April 17, 2017 (ITFG - 5 (Revised)), the deemed cost of property, plant and equipment as at the transition date has been increased by Rs. 2,678.52 lakhs as at March 31, 2017 (April 01, 2016- Rs 2,116.42 lakhs) being the unamortised EPCG scheme with corresponding increase in other non-current liabilities/ other current liabilities as on the date of the transition. Government Grant recognised under EPCG scheme and TUFS capital subsidy has been apportioned equivalent to the depreciation on EPCG and TUFS capital subsidy (Refer Note 47). The Company has provided incremental depreciation to the extent of Rs. 4,650.87 lakhs for the year ended March 31, 2017 ( Rs. 4,102.21 lakhs April 01, 2016) on the government grant.

Note 5: Remeasurements of post-employment benefit obligations

Under Ind AS, remeasurements i.e. acturial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of Statement of Profit and Loss under the previous GAAP. Consequently, the Loss for the year ended March 31, 2017 increased by Rs. 23.67 lakhs. There is no impact on the total equity and Loss.

Note 6:-Deferred Tax

Under previous GAAP, deferred tax accounting was done using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS approach has resulted in recognition of deferred taxes on temporary differences which were not recorded under previous GAAP. Further, the various transitional adjustments have led deferred tax implication which the Company has accounted for Deferred tax adjustments are recognised in correlation to the underlying transaction either in retained earnings or other comprehensive income, on the date of transition.

Note 7:- Cash discount on purchases

Under previous GAAP, cash discount on purchases were classified under ''Other Income''. However, as per Ind AS, it is shown as reductions from Cost of materials consumed. Accordingly, cash discount of Rs. 3.01 Lakhs have been reclassified from other income and shown as reduction from cost of materials consumed. There is no impact on the total equity and loss.

Note 8:- Discounts and incentives to customers

Company runs various promotional programmes for its customers. The fair value of those discounts / incentives given to the customers and has reduced it from the total sales consideration to record revenue on net basis. This change has resulted in a decrease in total revenue and decrease in total expenses for the year ended March 31, 2017 by Rs. 975.07 Lakhs. There is no impact on the total equity and Loss.

Note 9:- Bill Discounting, Acceptances and Supplier Credit

Under previous IGAAP, bill discounting is netted against debtors. However, as per Ind AS based on criteria of derecognition of assets, the bill discounting is to be shown as separate liability under borrowings without netting of debtors. Further, acceptance and suppliers'' credit is shown in the borrowings instead of trade payable. There is no impact on the total equity and Loss.

Note 10:- Investment Property

Under the previous GAAP, investment properties were presented as part of non-current investments. Under Ind AS, investment properties are required to be separately presented on the face of the balance sheet. There is no impact on the total equity or profit / loss as a result of this adjustment.

Note 11:- 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 profit or loss but are shown in the Statement of Profit and Loss as ''other comprehensive income'' includes remeasurements of defined benefit plans and fair value gains or losses on FVOCI equity instruments. The concept of other comprehensive income did not exist under previous GAAP.

Note 12:- Retained Earnings:

Retained earnings as at April 01, 2016 has been adjusted consequent to the above Ind AS transition adjustments.

Note 13:- Others:

Others mainly comprises of:-

(a) Inventory- Under Indian GAAP, the Company was using different techniques for measurement of cost of similar inventories at various locations. However as per Ind AS-2, an entity shall use the same cost formula for all inventories having a similar nature and use to the entity. For inventories with a different nature or use, different costs formulas may be justified. Accordingly the Company has applied the same formula for valuation of inventory where there is similar nature or use of inventory and aligned the valuation method used in various division. The effect of the same for both the years are considered in total equity as on March 31, 2017 and April 01, 2016 and under Total Comprehensive Income for the year ended March 31, 2017;

(b) Impact of transaction costs in respect of borrowings to be deducted from the carrying amount of borrowings on initial recognition and are recognized in the Statement of Profit and Loss over the tenure of the borrowings as the part of the interest expense by applying the effective interest rate method; and

(c) Impact of foreign exchange forward contracts which are marked to market as at each Balance sheet date.

Note 14:- As required under paragraph (IOC) of Ind AS 101, the Company has reclassified items that it recognised in accordance with previous GAAP as one type of asset, liability or component of equity, but are a different type of asset, liability or component of equity in accordance with Ind AS.

Note 49

(i) As legally advised, the Company has not recognized as income recovery of rent and other charges of Rs.83.61 lakhs upto 31st March, 2018 (Rs. 83.61 lakhs upto 31st March, 2017) pending final resolution of legal dispute with certain ex-tenants of a property in South Mumbai. At present, the legal dispute is pending with the Hon''ble Bombay High Court. A sum of Rs. 577.89 lakhs (Net) was withdrawn by the Company in accordance with the Orders passed by the Hon''ble High Court of Bombay on the Civil Revision Applications filed by the ex-tenants and the said amount of Rs 577.89 lakhs has been included in other current/ non-current liabilities.

(ii) In an earlier year, the Company had sold part of its leasehold land at its Mazgaon unit. The Company is required to surrender the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of V.J.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the agreement, the developer will construct a structure and hand it over to the Company.

(iii) Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL) in 2002, the shareholders of the Company are to be issued one equity share of Rs. 10/- each, fully paid-up, in SSL for every 500 shares of Rs. 100/-each, fully paid-up, held in the Company as consideration for the demerger, aggregating to Rs. 1.00 lakh. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the rehabilitation scheme sanctioned by BIFR envisages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of Rs. 1.00 lakh from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

(iv) As reported earlier, Writ Petition No.2982 of 2016 filed by the Company (along with Notice of Motion taken out therein) in the Hon''ble Bombay High Court, inter alia, challenging the illegal handing over of a part of land at Mazagaon (Reserved Land) by the Collector to Municipal Corporation of Greater Mumbai, which is required to be surrendered by the Company in lieu of eligibility of Non-cash Compensation, is pending. Status quo Orders are continuing in respect of the said Reserved Land and accordingly the

Company continues to remain in possession of the said Reserved Land. Note 50 - Disclosures of Specified Bank Notes (''SEN'')

The Ministry of Corporate Affairs (''MCA'') in its'' notification dated 30th March 2017 amended Schedule III to the Companies Act, 2013 requiring Companies to provide the following disclosure in the financial statement in respect of Specified Bank Notes (''SEN'') held and transacted during the period 8th November, 2016 to 30th December, 2016:

Particulars	SBNs	Other Denomination Notes	Total
Closing Cash in Hand as on 8th November, 2016	8.63	17.50	26.13
( ) Permitted Receipts	0.02	75.70	75.72
(-) Permitted Payments	5.00	75.48	80.48
(-) Amount Deposited in Banks	3.65	1.15	4.80
Closing Cash in Hand as on 30th December, 2016	-	16.57	16.57
Note 51 - Others

Export Promotion Capital Goods (EPCG) scheme allows import of certain capital goods including spares at concessional duty subject to an export obligation for the duty saved on capital goods imported under EPCG scheme. The duty saved on capital goods imported under EPCG scheme being Government Grant, is accounted as stated in the Accounting policy on Government Grant.

In terms of our report attached.
For Price Waterhouse Chartered Accountants LLP	For and on behalf of the Board of Directors
Registration No.012754N/ N500016	H. A. Mafatlal
	Chairman		Directors
	(DIN:00009872)	Aniruddha Deshmukh	V. R. Gupte (DIN:00011330)
		Managing Director &	A. K. Srivastava (DIN: 00046776)
	P. H. Mafatlal	Chief Executive Officer	P. N. Kapadia (DIN:00078673)
	Executive Director	(DIN:01389267)	G. G. Chakravarti (DIN:00004399)
	(DIN:02433237)		S. A. Shah (DIN:00058019)
			L. P. Pradhan (DIN:07118801)
Priyanshu Gundana	Ashish A. Karanji	Milan Shah
Partner	Company Secretary	Chief Financial Officer
Membership No. 109553
Mumbai, May 3, 2018	Mumbai, May 3, 2018

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Mar 31, 2017

(b) Term loan of Rs. 162.59 lakhs (Previous year Rs 315.50 lakhs) from a Financial Institution is repayable in quarterly installments till March, 2018. The loan is secured by pari-passu hypothecation charge on certain current assets of the Company and pledge by promoters/ promoter companies of certain shareholding in the Company. The loan carries interest @ 12.45% to 12.70% p.a. (Previous year 12.70% to 13.25% p.a.).

(c) Term loan of Rs. 1,437.01 lakhs (Previous year Rs. Nil) from a Financial Institution is repayable in quarterly installments begining from June 2017 till March, 2022 after a moratorium period of 12 months. The loan is secured by mortgage / hypothecation charge on certain fixed assets of the Company. The loan carries interest @ 11.75% to 12.00% p.a. (Previous year N.A.).

* Secured against Fixed Deposits of Rs.Nil, (Previous year: Rs.8,354.30 lakhs, last date of maturity 15th March, 2017).

** Cash credit facility are secured by hypothecation of certain stocks and book debts, both present and future, of the Company, second charge on certain Fixed Assets of the Company and pledge of investments held by the Company. The cash credit is repayable on demand and carry an interest @ 12.00% to 14.00% p.a. (Previous year 12.00% to 14.10% p.a.).

1) Building include Rs.12.86 lakhs (Previous year Rs.12.86 lakhs) being the cost of ownership premises in a co-operative society, including cost of shares received for the face value of Rs.2500/-, under the bye-laws of the society.

2) The Company is in process of getting expired leases renewed.

(i) Balance in Escrow Current account is operated under the supervision of Monitoring Committee constituted by the Government of Maharashtra, under Development Control Regulations, 1991.

(ii) (a) Bank deposits with more than 12 months maturity from Balance Sheet date is Rs.9.50 lakhs (Previous year Rs.10.00 lakhs).

(ii) (b) Includes balances with more than 12 months maturity from Balance Sheet date is Rs.219.43 lakhs (Previous year Rs.190.65 lakhs).

The interest subsidy for the year on the Term Loans availed under the Technology Up gradation Fund Scheme (TUFS) is Rs. 285.62 lakhs (Previous year Rs. 262.73 lakhs) and the same has been netted off from interest expense.

Note no. 3

Finance costs are net of Rs.473.47 lakhs (Previous year Rs. 175.92 lakhs) capitalized in fixed assets and CWIP- Refer note no. 31.13

In case of Mafatlal Centre:

A demand for Rs. 2,696.98 lakhs (Previous year Rs. 2,696.98 lakhs) for the period from 2004-07 and 2008-10 has been raised by Brihanmumbai Mahanagarpalika (''BMC'') towards Property Taxes in respect of the properties owned by various owners for the respective floors. The demand has been challenged by owners of various floors at appropriate forum and the matter is subjudice. In case the demand is finally upheld, the amount will be paid by the concerned co-owners and the Company will have no additional liability.

In case of Mafatlal Chambers:

A demand for '' 792.46 lakhs (Previous year Rs. 792.46 lakhs) for the period 2000-05 has been raised by Brihanmumbai Mahanagarpalika (''BMC'') towards Property Taxes in respect of the properties owned by the Company at the relevant time. The said demand has been disputed by the company. As per the directions given by the Honourable Bombay High Court, the BMC has granted hearing to the Company and the final outcome is awaited.

In the above matters (i) to (viii), the Company is hopeful of succeeding and as such does not expect any significant liability to crystallize.

Future cash outflows in respect of the above matters are determinable only on receipt of judgments / decisions pending at various forums / authorities.

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors. The Company has not received intimation from most of the suppliers regarding the status under the Micro, Small and Medium Enterprises Development Act, 2006.

4 As legally advised, the Company has not recognized as income recovery of rent and other charges of Rs.83.61 lakhs up to 31st March, 2017 (Rs. 83.61 lakhs up to 31st March, 2016) pending final resolution of legal dispute with certain ex-tenants of a property in South Mumbai. At present, the legal dispute is pending with the Hon''ble Bombay High Court. A sum of Rs. 577.89 lakhs (Net) was withdrawn by the Company in accordance with the Orders passed by the Hon''ble High Court of Bombay on the Civil Revision Applications filed by the ex-tenants and the said amount of Rs. 577.89 lakhs has been included in other current / non-current liabilities (Refer Note no. 7, 11 and Note no. 16).

5 Details on derivatives instruments and unhedged foreign currency exposures

I The following forward contracts positions are open as at year end. These transactions have been undertaken to act as economic hedges for the Company’s exposures to various risks in foreign exchange markets. The accounting of these transactions is stated in Note (h) of Significant Accounting Policies.

Forward exchange contracts are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency required or available at the settlement date of certain payables and receivables.

6 Due to inadequacy of profit, the managerial remuneration aggregating to Rs.406.26 lakhs, paid to Shri Aniruddha P. Deshmukh, Managing Director & Chief Executive Officer (Professional Director), Shri Priyavrata H. Mafatlal (Executive Director w.e.f. 1st November, 2016) and Shri Vishad P. Mafatlal, Executive Vice-Chairman up to 19th August, 2016, is in excess of the limits specified under Section 197(1) of the Companies Act, 2013. Though the remuneration is within the limits of Schedule V to the Companies Act, 2013, approval of the shareholders for the excess remuneration paid under Section 197(1) is required at the ensuing General Meeting.

7 In an earlier year, the Company had sold part of its leasehold land at its Mazgaon unit. The Company is required to surrender the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of V.J.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the agreement, the developer will construct a structure and hand it over to the Company.

8 Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL) in 2002, the shareholders of the Company are to be issued one equity share of Rs.10/- each, fully paid-up, in SSL for every 500 shares of Rs. 100/- each, fully paid-up, held in the Company as consideration for the demerger, aggregating to Rs.1.00 lakh. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the rehabilitation scheme sanctioned by BIFR envisages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of Rs. 1.00 lakh from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

9 Proposed Dividend on 13,912,886 equity shares of the face value of Rs. 10/- each for the year ended 31st March, 2017 @ Rs. 2/- per share is subject to approval in the Annual General Meeting and is not recognized as liability (including Dividend Distribution Tax thereon).

10 As reported earlier, the Company has filed Writ Petition No.2982/2016 in the HonRs.ble Bombay High Court challenging the demand notice of Rs.45,435 lakhs (in respect of Development Agreement dated 17th June 2011 entered into by the Company for a part of its leasehold land at Mazagaon) issued by The Collector of Mumbai City and further actions of the office of Collector there under. Pending the admission of the aforesaid Writ Petition, the Hon''ble High Court has recorded by its Orders dated 19th January 2017 and 27th January 2017 that the Collector is ready to recall its Order/ Demand and the subsequent attachment dated 29th November 2016 and give a fresh hearing to the Company and accordingly this Hon''ble Court set aside the Order/ Demand and subsequent attachment dated 29th November 2016. Accordingly, as recorded in Order dated 27th January 2017, the aforesaid demand notice and attachment order has been withdrawn by the Collector and the same has been recorded in the Property Card of C. S. No. 593. Pursuant to the notification dated 10th February 2004, the Company is required to hand over 50% of the land bearing C. S. No. 593 to Municipal Corporation of Greater Mumbai ("MCGM") which is under reservation ("the said land") and as per the said notification, the Company would be eligible to get non-cash compensation in lieu thereof. The Collector claims to have handed over possession of the said reserved land to MCGM during the pendency of proceedings. The Company had filed Notice of Motion No. 5 of 2017 in the Writ Petition No.2982 of 2016 for handing over possession of the said Land to the MCGM under direction of the Court and the claim of the Collector has been challenged by the Company before the Court. The Hon''ble High Court has accordingly by its orders dated 16th March 2017, 13th April 2017 and 28th April 2017 directed status quo to be maintained. The Company continues to be in possession of the said reserved land. The Hon''ble High Court has allowed the Chamber Summons No. 90 of 2017 filed by the Company for impleading MCGM as a party to the Writ Petition and permitting the Company to carry out incidental and consequential amendments to the Writ Petition for bringing subsequent acts of the Collector and MCGM on record. All interim reliefs granted earlier by the Hon''ble High Court are continuing till further orders.

11 Segment Information

As per the Accounting standard (AS) 17 on "Segment Reporting", segment information has been provided under the Notes to Consolidated Financial Statements.

12 Employee benefit plans

a) Defined contribution plans

Contributions are made to Recognized Provident Fund / Government Provident Fund and Family Pension Fund which covers all regular employees. Contribution is also made in respect of executives to a Recognized Superannuation Fund. While both the employees and the Company make predetermined contributions to the Provident Fund, contribution to the Family Pension Fund and Superannuation Fund are made only by the Company. The contributions are normally based on a certain proportion of the employee''s salary. The Company recognized during the year Rs. 469.05 lakhs (Previous year Rs.472.65 lakhs) as Provident Fund Contribution, Rs. 242.05 lakhs (Previous year Rs.228.96 lakhs) as Super Annuation Contribution and Rs.144.22 lakhs (Previous year Rs.104.85 lakhs) as Pension Fund Contribution.

b) Defined benefit plans

Contributions are made to a Recognized Gratuity Fund in respect of gratuity based upon actuarial valuation done at the year end of every financial year using "Projected Unit Credit" method and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation. Gains and losses on changes in actuarial assumptions are accounted for in the Statement of Profit and Loss.

The charge on account of provision for gratuity has been included in ''Employee Benefits Expense'' in the Statement of Profit and Loss.

The discount rate is based on the prevailing market yields of Government of India securities as at the Balance Sheet date for the estimated term of the obligations.

The estimate of future salary increases considered, takes into account the inflation, seniority, promotion, increments and other relevant factors.

All the employees are eligible for compensated absences of 30 days in each financial year which can be encashed during the tenure of employment. Employees cannot carry forward any compensated absences in excess of 300 days. The provision for these absences, made on the basis of Actuarial Valuation on "Projected Unit Credit" method is Rs. 636.51 lakhs (Previous year Rs.619.35 lakhs). Net charge for the year Rs. 284.55 (Previous year Rs.223.75 lakhs).

Note 13

Related Parties Transactions Details of Related Parties A Subsidiary Company

Mafatlal Services Limited B Jointly Controlled Entity

Al Fahim Mafatlal Textiles LLC- A Joint Venture with Al Fahim Linez LLC- (UAE) (Refer Note no. 32.6)

C Associates

D Key Management Personnel

Aniruddha Deshumkh

V. P. Mafatlal (upto 19th August 2016)

Priyavrata H. Mafatlal (From 1st November 2016)

Rajiv Dayal (upto 12th August 2015)

E Enterprises over which key management personnel and their relatives are able to exercise significant influence NOCIL Limited

Navin Flourine International Limited (upto 19th August 2016)

Sulakshana Securities Limited (upto 19th August 2016)

Krishnadeep Housing Development Private Limited (upto 19th August 2016)

Mafatlal Impex Private Limited (upto 19th August 2016)

Mafatlal Fabrics Private Limited (upto 19th August 2016)

F Individual having significant influence

H. A. Mafatlal

G Relatives of Individual having significant influence

Priyavrata H. Mafatlal (upto 31st October, 2016)

H Enterprises over which Individual having significant influence and relatives of such individual are able to exercise significant influence.

Sukarma Investments Private Limited

Suremi Trading Private Limited

Silvia Apparel Limited

Mafatlal Global Apparel Limited

Altamount Product and Services Private Limited

Figures in italics represent previous year figures.

- Includes Gratuity and leave encashment at the end of the tenure.

- Navin Flourine International Ltd., Mafatlal Impex Pvt. Ltd. and Sulakshana Securities Ltd. are considered to be related parties only till 19 August 2016. Note 32.6 Details of the Company''s interest in Joint Venture Interest in joint venture

The Company has interests in the following joint venture - Jointly Controlled Entity (JCE):

Note:- The Jointly controlled entity '' Al Fahim Mafatlal Textile LLC, UAE'' is currently under the process of winding up. Pursuant to such winding up the Company''s interest in the joint venture ceases to exist and the same passes on to the competent authority responsible for closure of operations as per the law of the jurisdication in which it is incorporated. Hence the Company has no access to the financials of the JCE which are under the control of such competent authority and so no information about it can be disclosed.

Note: Figures in brackets relate to the previous year.

Note 14

The Company has not made any remittances in foreign currencies on account of dividends during the year and does not have information as to the extent to which remittances in foreign currencies on account of dividends have been made by or on behalf of non-resident shareholders. The particulars of dividends paid to non-resident shareholders are as follows:

15The Ministry of Corporate Affairs (''MCA'') in its'' notification dated 30th March 2017 ammended Schedule III to the Companies Act, 2013 requiring Companies to provide the following disclosure in the financial statement in respect of Specified Bank Notes (''SBN'') held and transacted during the period 8th November 2016 to 30th December 2016:

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Mar 31, 2016

b. (i) Terms / rights attached to Equity shares:

The Company has issued only one class of equity shares having a par value of Rs. 10/- per share. Each equity shareholder is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the ensuing Annual General Meeting.

During the year ended 31st March, 2016, the amount of dividend, per share, recognized as distributions to equity shareholders is Rs. 3/- (Previous year ended 31st March, 2015 Rs. 3/-).

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

(i) For Current maturities of Long Term Borrowings; Refer Note No.11(a) - Other Current Liabilities.

(ii) (a) Term loans of Rs. 1,764.15 lacs (Previous year Rs. 2,619.15 lacs) from a bank are repayable in quarterly installments till March, 2018. These loans are secured by a pari-passu mortgage / hypothecation charge on certain Fixed Assets, including leasehold land and hypothecation charge on certain current assets of the Company and pledge by promoters / promoter companies of certain shareholding in the Company. The loans carry interest linked to the lenders'' Prime Lending Rates. The effective rate of interest for the year was in the range of 14.25% to 14.90% p.a. (Previous year 14.90% to 15.00% p.a.).

(b) Term loan of Rs. 536.47 lacs (Previous year Rs. NIL) from a bank are repayable in quarterly installments beginning from June, 2017 till May, 2022 after a moratorium period of 15 months. The loan is secured by mortgage / hypothecation charge on certain Fixed Assets and pari-passu second charge on certain current assets of the Company. The loan carry interest linked to the lenders'' PLR. The effective rate of interest for the year was 12.25% p.a. (Previous year Not Applicable).

(c) Term loan of Rs. 2,499.99 lacs (Previous year Rs. 1,814.62 lacs) from a bank are repayable in monthly installments beginning from September, 2016 till August, 2021 after a moratorium period of 24 months. The loan is secured by mortgage / hypothecation charge on certain Fixed Assets and pledge of Equity shares owned by the Company. The loan carry interest linked to the lenders'' Prime Lending Rates. The effective rate of interest for the year was in the range of 14.25% to 14.50% p.a. (Previous year: 14.00% to 14.50% p.a.).

(d) Term loan of Rs. 2,457.63 lacs (Previous year Rs. 1,813.88 lacs) from a bank are repayable in monthly installments beginning from December, 2016 till December, 2021 after a moratorium period of 24 months. The loan is secured by mortgage / hypothecation charge on certain Fixed Assets and second charge on certain current assets of the Company. The loan carry interest linked to the lenders'' Prime Lending Rates. The effective rate of interest for the year was in the range of 12.50% to 13.50% p.a. (Previous year: 13.50% to 13.75% p.a.).

(iii) Loans for Vehicles from Banks is repayable in monthly installments and the same is secured by hypothecation of respective vehicles. The effective rate of interest for the year was in the range of 10.50% to 11% p.a. (Previous year 10.50% to 11% p.a.).

(iv) (a) Term loan of Rs. 464.25 lacs (Previous year Rs. 689.25 lacs) from a Financial Institution is repayable in quarterly installments till March, 2018. The loan is secured by a pari-passu mortgage / hypothecation charge on the Company''s certain Fixed Assets, including leasehold land and hypothecation charge on certain current assets of the Company and pledge by promoters / promoter companies of certain shareholding in the Company. The loan carry an interest linked to the lenders'' Prime Lending Rates. The effective rate of interest for the current year was at 12.70% to 13.25% p.a. (Previous year 13.25% to 16.75% p.a.).

(b) Term loan of Rs. 315.50 lacs (Previous year Rs. 468.41 lacs) from a Financial Institution is repayable in quarterly installments till March, 2018. The loan is secured by pari-passu hypothecation charge on certain current assets of the Company and pledge by promoters / promoter companies of certain shareholding in the Company. The loan carries interest @ 12.70% to 13.25% p.a. (Previous year 12.25% to 13.25% p.a.).

In case of Mafatlal Centre:

A demand for Rs. 2,696.98 lacs (Previous year Rs. 2,696.98 lacs) for the period from 01.04.2008 to 31.03.2010 has been raised by Brihanmumbai Mahanagarpalika towards Property Taxes in respect of the properties owned by various owners for the respective floors. No demand is raised in respect of common areas / properties in the name of the Company. The demand has been challenged by owners of various floors at appropriate forum and the matter is subjudiced. In case the demand is finally upheld, the amount will be paid by the concerned co-owners and the Company will have no additional liability

In case of Mafatlal Chambers:

A demand for Rs. 378.51 lacs (Previous year Rs. 378.51 lacs) for earlier years has been raised by Brihanmumbai Mahanagarpalika towards Property Taxes in respect of the properties owned by the Company for the respective floor.

In the above matters (i) to (ix), the Company is hopeful of succeeding and as such does not expect any significant liability to crystallize.

Future cash outflows in respect of the above matters are determinable only on receipt of judgments / decisions pending at various forums / authorities.

1. As legally advised, the Company has not recognized as income recovery of rent and other charges of Rs. 83.61 lacs upto 31st March, 2016 (Rs. 83.61 lacs upto 31st March, 2015) pending final resolution of legal dispute with certain ex-tenants of a property in South Mumbai. At present, the legal dispute is pending with the Hon’ble Bombay High Court. A sum of Rs. 577.89 lacs (Net) was withdrawn by the Company in accordance with the Orders passed by the Hon’ble High Court of Bombay on the Civil Revision Applications filed by the ex-tenants and the said amount of Rs. 577.89 lacs has been included in other current liabilities (Refer Note no. 7, 11 and Note no. 16).

2. a) Disclosure as per Clause 32 of the Listing Agreements with the Stock Exchanges

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

3. Details on derivatives instruments and unhedged foreign currency exposures

I. The following forward contracts positions are open as at year end. These transactions have been undertaken to act as economic hedges for the Company’s exposures to various risks in foreign exchange markets. The accounting of these transactions is stated in Note (h) of Significant Accounting Policies.

Forward exchange contracts are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency required or available at the settlement date of certain payables and receivables.

30.12 a) Due to inadequacy of profit the remuneration paid to Shri Aniruddha Deshmukh Managing Director & Chief Executive Officer (Professional Director) is in excess of the limits specified under Section 197 of the Companies Act, 2013 read with Schedule V by Rs. 36.82 lacs. As required by the law necessary approvals are being / will be taken by the Company from the Shareholders and the Central Government.

b) Due to inadequacy of profit during the year Shri Vishad P Mafatlal (Vice-Chairman) has been paid remuneration with limits as prescribed under Schedule V of the Companies Act, 2013 and the same is subject to approval of the shareholders.

4 In an earlier year, the Company had sold part of its leasehold land at its Mazgaon unit. The Company is required to surrender the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of VJ.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the agreement, the developer will construct a structure and hand it over to the Company.

5 Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL) in 2002, the shareholders of the Company are to be issued one equity share of Rs. 10/- each, fully paid-up, in SSL for every 500 shares of Rs. 100/- each, fully paid-up, held in the Company as consideration for the demerger, aggregating to Rs. 1.00 lac. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the rehabilitation scheme sanctioned by BIFR envisages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of Rs. 1.00 lac from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

6 Pursuant to the transitional provisions prescribed in Schedule II to the Companies Act, 2013, the Company had fully depreciated the carrying value of assets, net of residual value, where the remaining useful life of the asset was determined to be nil as on April 1, 2014, and had adjusted an amount of Rs. 111.57 lacs (net of deferred tax of Rs. 57.45 lacs) against the opening Surplus balance in the Statement of Profit and Loss under Reserves and Surplus of the previous year.

7 Segment Information

As per the Accounting standard (AS) 17 on "Segment Reporting", segment information has been provided under the Notes to Consolidated Financial Statements.

8. Employee benefit plans

a) Defined contribution plans

Contributions are made to Recognized Provident Fund / Government Provident Fund and Family Pension Fund which covers all regular employees. Contribution is also made in respect of executives to a Recognized Superannuation Fund. While both the employees and the Company make predetermined contributions to the Provident Fund, contribution to the Family Pension Fund and Superannuation Fund are made only by the Company. The contributions are normally based on a certain proportion of the employee’s salary. The Company recognized during the year Rs. 472.65 lacs (Previous year Rs. 420.80 lacs) as Provident Fund Contribution, Rs. 228.96 lacs (Previous year Rs. 166.43 lacs) as Super Annotation Contribution and Rs. 104.85 lacs (Previous year Rs. 75.97 lacs) as Pension Fund Contribution.

b) Defined benefit plans

Contributions are made to a Recognized Gratuity Fund in respect of gratuity based upon actuarial valuation done at the year end of every financial year using "Projected Unit Credit" method and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation. Gains and losses on changes in actuarial assumptions are accounted for in the Statement of Profit and Loss.

The charge on account of provision for gratuity has been included in ''Employee Benefits Expense'' in the Statement of Profit and Loss.

The discount rate is based on the prevailing market yields of Government of India securities as at the Balance Sheet date for the estimated term of the obligations.

The estimate of future salary increases considered, takes into account the inflation, seniority, promotion, increments and other relevant factors.

All the employees are eligible for compensated absences of 30 days in each financial year which can be encashed during the tenure of employment. Employees cannot carry forward any compensated absences in excess of 300 days. The provision for these absences, made on the basis of Actuarial Valuation on "Projected Unit Credit" method is Rs. 619.35 lacs (Previous year Rs. 657.30 lacs). Net charge for the year Rs. 223.75 lacs (Previous year Rs. 261.09 lacs).

Note 9.

Related Parties transactions Details of Related Parties A Subsidiary Company

Mafatlal Services Limited B Jointly Controlled Entity

AL Fahim Mafatlal Textiles LLC- A Joint Venture with Al Fahim Linez LLC- (UAE) (Refer Note no.31.6)

C Associates

D Key Management Personnel

Rajiv Dayal (till 12.08.2015)

V. P. Mafatlal

Aniruddha Deshkumh (From 13.08.2015)

E Enterprises over which key management personnel and their relatives are able to exercise significant influence

NOCIL Limited

Navin Flourine International Limited Sulakshana Securities Limited Krishnadeep Housing Development Private Limited Mafatlal Impex Private Limited Mafatlal Fabrics Private Limited Aureole Clothing Private Limited F Individual having significant influence H.A. Mafatlal

G Relatives of Individual having significant influence

Priyavrata H. Mafatlal

H Enterprises over which Individual having significant influence and relatives of such individual are able to exercise significant influence.

Sukarma Investments Private Limited Suremi Trading Private Limited Silvia Apparel Limited

Mafatlal Global Apparel Limited (since 24.03.2015)

Alt amount Product and Services Private Limited

Note 10.

11. The Company has not made any remittances in foreign currencies on account of dividends during the year and does not have information as to the extent to which remittances in foreign currencies on account of dividends have been made by or on behalf of non-resident shareholders. The particulars of dividends paid to non-resident shareholders are as follows:

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

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Mar 31, 2014

Note

Particulars As at 31st March, 2014 As at 31st March, 2013

1.1 Contingent liabilities and commitments (to the extent not provided for)

(a) The Company is contingently liable for :

i Bills of exchange discounted 574.25 357.63

ii Demands of income-tax authorities disputed in appeals (mainly relate to disallowance of investment 730.85 701.32 / loan write off, claim of interest on refund of excise duty/ sales tax, disallowance of chapter VIA deductions, etc. (pending before the Income-tax Appellate Tribunal/ High Court))

iii Demands under excise and other proceedings disputed in appeals (mainly relating to matters 2,614.89 2,614.89 like differential duty on revision of assessable value of yarn captively consumed, duty on T.C. hard waste, duty on drill etc. (pending at various stages, from Assistant Commissioner to CESTAT))

iv Disputed demand notice issued by the 2,960.55 1,453.27 Commissioner of Central Excise relating to Excise and Service Tax matters (Current year: including Penalty)

v Claims against the Company not acknowledged as 113.38 113.38 debts (mainly relating to dispute on fixed water charges at Navsari Unit, disputed service tax, interest on sales tax)

vi Concessional customs duty on import of machinery 1,198.21 1,136.11 under EPCG Scheme payable subject to fulfillment of mandatory import/ export obligation. The Company has submitted a bond to the authorities of Rs. 1,000.00 lacs.

vii Claims made by workers against the Company 1,172.08 1,191.61 (mainly relating to matters like termination, compensation etc.)

viii Demands from Director General of Foreign Trade 4.79 4.79 against Advance License

ix The Company is a lessee in respect of the land on - - which Mafatlal Centre and Mafatlal Chambers is erected. In this regard:

In case of Mafatlal Centre:

a) A demand for Rs. 2,696.98 lacs (Previous year Rs. 2,712.47 lacs) for the period from 01.04.2008 to 31.03.2010 has been raised by Brihanmumbai Mahanagarpalika towards Property Taxes in respect of the properties owned by various owners for the respective floors. No demand is raised in respect of common areas / properties in the name of the Company. The demand has been challenged by owners of various floors at appropriate forum and the matter is subjudice. In case the demand is finally upheld the amount will be paid by the concerned co-owners and the Company will have no additional liability

b) Pursuant to introduction of new system of capital based assessment of Property Taxes, there is an outstanding demand for Rs. 378.21 lacs (Previous year Rs. 196.30 lacs) for the period from 01.04.2010 to 31.03.2014 in respect of the properties owned by various owners for the respective floors and in respect of common areas / properties in the name of the Company. The demand has been challenged by various owners and / or the Company before appropriate forum. The demand of Rs. 378.21 lacs will be paid by the concerned co-owners and the Company will have no liability on account of the same.

In case of Mafatlal Chambers:

a) A demand for Rs. 378.51 lacs (Previous year Rs. 378.51 lacs) for earlier years has been raised by Brihanmumbai Mahanagarpalika towards Property Taxes in respect of the properties owned by the Company for the respective floor.

b) Pursuant to introduction of new system of capital based assessment of Property Taxes, a demand for Rs. 887.80 lacs for the period from 01.04.2010 to 31.03.2014 (Previous year Rs. 576.03 lacs upto 31.03.2013) has been raised in respect of the properties owned by various owners for the respective floors and in respect of common areas / properties in the name of the Company. The demand has been challenged by various owners and / or the Company before appropriate forum. In case the demand is finally upheld, the Company will have to pay Rs. 97.01 lacs. Of this demand, Rs. 75.16 lacs has been deposited upto 31.03.2014. Balance demand of Rs. 812.64 lacs (Rs. 887.80 lacs less Rs. 75.16 lacs) will be paid by the concerned co-owners and the Company will have no liability on account of the same.

In the above matters (i) to (ix), the Company is hopeful of succeeding and as such does not expect any significant liability to crystallize.

1.2 I. MISHAPAR INVESTMENTS LIMITED (MISHAPAR):

a) During the previous year, pursuant to the Scheme of Arrangement and Amalgamation (the "Scheme"), Mishapar Investments Limited (the "Transferor Company" or "Mishapar") had merged with the Company (the "Transferee Company"), upon which the undertaking and the entire business, including all assets and liabilities of Mishapar stood transferred to and vested in the Transferee Company with effect from 1st April 2012. The Scheme became effective on 28th May, 2013 and was given effect to in the previous year. The amalgamation had been accounted under the "Purchase Method" as envisaged under the Scheme and the Accounting Standard (AS) – 14 on "Accounting for Amalgamations" notified under the Companies (Accounting Standards) Rules, 2006.

b) Since Mishapar was Wholly Owned Subsidiary of the Transferee Company, there was no consideration payable or receivable on implementation of the Scheme. The entire issued, subscribed and paid-up Share Capital had been cancelled against the corresponding investment of the Transferee Company and an amount of Rs. 3,931.71 lacs being excess of carrying value of the investments in the Transferee Company (Rs. 4,800.10 lacs) over the Net Assets acquired (Rs. 868.39 lacs) was debited to Goodwill pursuant to the Scheme approved by the Honourable High Court of Judicature at Mumbai. The Goodwill so arising was charged off to the Statement of Profit and Loss of the Transferee Company and the charge so arising was set-off in the Statement of Profit and Loss against the balance available in the Securities Premium Account. Also, 388 equity shares of Rs. 10 each held by Mishapar in the share capital of the Transferee Company stood cancelled pursuant to the Scheme.

c) Particulars of assets and liabilities taken over on amalgamation:

II. MAFATLAL DENIM LIMITED (MDL):

a) During the previous year, in terms of the Scheme of Arrangement and Amalgamation (the "Scheme"), Mafatlal Denim Limited (the "Transferor Company" or "MDL") had merged with the Company (the "Transferee Company"), upon which the undertaking and the entire business, including all the assets and liabilities of MDL stood transferred to and vested in the Transferee Company with effect from 1st April 2012. The Scheme approved by the Honourable High Court of Judicature at Gujarat, became effective on 28th May, 2013 and was given effect to in the previous year. The assets and liabilities were transferred at their respective book values under the "Pooling of Interest Method" as envisaged under the Scheme and the Accounting Standard (AS) – 14 on "Accounting for Amalgamations" notified under the Companies (Accounting Standards) Rules, 2006

b) Particulars of assets and liabilities taken over on amalgamation:

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors. The Company has not received intimation from most of the suppliers regarding the status under the Micro, Small and Medium Enterprises Development Act, 2006.

1.3 As legally advised, the Company has not recognized as income recovery of rent and other charges of Rs. 83.61 lacs upto 31st March, 2014 (Rs. 186.29 lacs upto 31st March, 2013), pending final resolution of the legal dispute with certain ex-tenants of a property in South Mumbai. The Civil Revision Applications filed by the ex-tenants has been admitted by the Hon''ble Bombay High Court and the ex-tenants have deposited Rs. 1,233.47 lacs (amount decreed by the learned trial judge alongwith interest awarded by the appeal bench of the Small Causes Court) as directed by the Hon''ble High Court while granting stay on the order issued by the Appeal Bench of the Hon''ble Small Causes Court. The Company has withdrawn the said amount of Rs. 1,233.47 lacs by providing undertakings as directed by the Hon''ble High Court to repay the amount, if the ex-tenants succeed in the civil revision applications which are pending for final disposals. Out of the said amount, Rs. 655.58 lacs has been paid to Sulakshana Securities Limited, in whom one of the premises was vested under the Company''s rehabilitation scheme which was approved by BIFR, during the pendency of the said litigation. The balance amount of Rs. 577.89 lacs has been included in Other Current Liabilities (Refer Note no. 11 and Note no. 16).

1.4 Disclosure as per Clause 32 of the Listing Agreements with the Stock Exchanges

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

1.5 The remuneration of Shri V. P. Mafatlal, Vice-Chairman and Shri Rajiv Dayal, Managing Director & Chief Executive Officer (Professional Director) was approved by the members by way of a special resolution passed at the Annual General Meeting (''AGM'') held on 31st July, 2013. Due to inadequate profits during the current year, the total managerial remuneration of Rs. 232.07 lacs (Shri V. P. Mafatlal – Rs. 114.79 lacs and Shri Rajiv Dayal – Rs. 117.28 lacs) paid to the above executive directors is in excess of the limits specified under Section 198, 349 & 350 of the Companies Act, 1956 by Rs. 78.61 lacs. As required by law, necessary application will be made to the Central Government in this regard.

1.6 In the earlier year, the Company had sold part of its leasehold land at its Mazgaon unit. The Company is required to surrender the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of V.J.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the agreement, the developer will construct a structure and hand it over to the Company.

1.7 Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL) in 2002, the shareholders of the Company are to be issued one equity share of Rs. 10/- each, fully paid-up, in SSL for every 500 shares of Rs.100/- each, fully paid-up, held in the Company as consideration for the demerger, aggregating to Rs. 1.00 lac. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the rehabilitation scheme sanctioned by BIFR envisages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of Rs.1.00 lac from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

The Company has entered into operating lease arrangements for certain facilities and residence premises. The leases are non-cancellable and are for a period upto 9 years and may be renewed for a further period upto 3 years based on mutual agreement of the parties. The lease agreements provide for an increase in the lease payments upto 15% every 3 years. There are no sub-leases.

1.8 Segment Information

As per the Accounting standard (AS) 17 on "Segment Reporting", segment information has been provided under the Notes to Consolidated Financial Statements.

1.9 Employee benefit plans

a) Defined contribution plans

Contributions are made to Recognized Provident Fund / Government Provident Fund and Family Pension Fund which covers all regular employees. Contribution is also made in respect of executives to a Recognized Superannuation Fund. While both the employees and the Company make predetermined contributions to the Provident Fund, contribution to the Family Pension Fund and Superannuation Fund are made only by the Company. The contributions are normally based on a certain proportion of the employee''s salary. Amount recognized as expense in respect of these defined contribution plans, aggregate to Rs. 619.46 lacs (Previous year Rs. 526.66 lacs).

b) Defined benefit plans

Contributions are made to a Recognized Gratuity Fund in respect of gratuity based upon actuarial valuation done at the year end of every financial year using "Projected Unit Credit" method and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation. Gains and losses on changes in actuarial assumptions are accounted for in the Statement of Profit and Loss.

The charge on account of provision for gratuity has been included in ''Employee Benefits Expense'' in the Statement of Profit and Loss.

The discount rate is based on the prevailing market yields of Government of India securities as at the Balance Sheet date for the estimated term of the obligations.

The estimate of future salary increases considered, takes into account the inflation, seniority, promotion, increments and other relevant factors.

All the employees are eligible for compensated absences of 30 days in each financial year which can be encashed during the tenure of employment. Employees cannot carry forward any compensated absences in excess of 300 days. The provision for these absences, made on the basis of Actuarial Valuation on "Projected Unit Credit" method is Rs. 647.16 lacs (Previous year Rs. 629.24 lacs). Net charge for the year Rs. 166.78 lacs (Previous year Rs. 276.25 lacs).

1.10 Related Parties Transactions Details of Related Parties

A Subsidiary Companies

Mafatlal Services Limited

Ibiza Industries Limited (also a joint venture) (currently under liquidation)

Sunanda Industries Limited (currently under liquidation)

Mayflower Textiles Private Limited (upto 25.03.2014)

Myrtle Textiles Private Limited (upto 25.03.2014)

Repal Apparel Private Limited (upto 25.03.2014)

Mafatlal Global Apparel Limited (upto 29.09.2012)

Silvia Apparel Limited (upto 30.03.2013)

B Jointly Controlled Entity

AL Fahim Mafatlal Textiles LLC- A Joint Venture with Al Fahim Linez LLC- (UAE) (Refer Note no.31.6) C Associates

Mafatlal Global Apparel Limited (since 29.09.2012)

Mafatlal V. K. Intex Limited (upto 25.03.2014)

Mafatlal Engineering Industries Limited (currently under liquidation)

Mafatlal Limited - (Incorporated in United Kingdom) (currently under liquidation)

Sushmita Engineering and Trading Limited (upto 25.03.2014)

Repos Trading Company Limited (upto 25.03.2014) D Key Management Personnel

H. A. Mafatlal (upto 28.05.2013)

Rajiv Dayal

V. P. Mafatlal

E Relatives of Key Management Personnel

Rupal V. Mafatlal

Rekha H. Mafatlal (upto 28.05.2013)

Priyavrata H. Mafatlal (upto 28.05.2013)

F Enterprises over which key management personnel and their relatives are able to exercise significant influence NOCIL Limited

Navin Flourine International Limited Sulakshana Securities Limited Krishnadeep Housing Development Private Limited Mafatlal Impex Private Limited Mafatlal Fabrics Private Limited Myrtle Chemtex Trading Private Limited Aureole Clothing Private Limited

G Individual having significant influence

H.A. Mafatlal (since 29.05.2013)

H Relatives of Individual having significant influence

Rekha H. Mafatlal (since 29.05.2013)

Priyavrata H. Mafatlal (since 29.05.2013)

I Enterprises over which Individual having significant influence and relatives of such individual are able to exercise significant influence

Sukarma Investments Private Limited

Suremi Trading Private Limited

Altamount Product and Services Private Limited

Silvia Apparel Limited (since 31.03.2013)

Details of transactions with related parties during the year :

1.11 Details of the Company''s interest in Joint Venture having Joint Control, as per the requirements of Accounting Standard- 27 on Financial Reporting of Interests in Joint Ventures notified under the Companies (Accounting Standards) Rules, 2006 is as under:

Interest in joint ventures

The Company has interests in the following joint ventures - Jointly controlled entities (JCE):

The Joint Venture has come in to existence in the previous year.

Note: Figures in brackets relate to the previous year.

1.12 The Company has not made any remittances in foreign currencies on account of dividends during the year and does not have information as to the extent to which remittances in foreign currencies on account of dividends have been made by or on behalf of non-resident shareholders. The particulars of dividends paid to non-resident shareholders are as follows:

1.13 The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with Section 212 of the Companies Act,1956, subject to fulfilment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

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

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Mar 31, 2013

1. Corporate Information

Mafatlal Industries Limited (the Company) is a public limited company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on the Mumbai and Ahmedabad stock exchanges. The Company belongs to the reputed industrial house of Arvind Mafatlal Group in India, established in 1905. The Company is engaged in textile manufacturing and trading, having its units at Nadiad and Navsari.

2.1 I. MISHAPAR INVESTMENTS LIMITED (MISHAPAR)

a) In terms of the Scheme of Arrangement and Amalgamation ("the Scheme”), Mishapar has been merged with the Company (Transferee Company), upon which the undertaking and the entire business, including all assets and liabilities of Mishapar stand transferred to and vested in the Transferee Company. Assets and liabilities so transferred have been recorded at their fair value as determined by the Board of Directors of the Transferee Company The amalgamation has been accounted under "Purchase Method'' as envisaged in the Accounting Standard (AS) - 14 "Accounting for Amalgamations” notified under the Companies (Accounting Standards) Rules, 2006. Mishapar was a Non-Banking Finance Company into investing and financing activity and was 100% subsidiary of the Company

b) The Scheme filed by the Company has been approved by the Honourable High Court of Judicature at Mumbai, with an appointed date of 1st April, 2012 and an effective date of 28th May 2013 (''the Effective Date''), being the date on which all the requirements under the Companies Act, 1956 have been completed

c) Since amalgamating company is Wholly Owned Subsidiary of the Transferee Company, there is no consideration payable or receivable on implementation of the Scheme. The entire issued, subscribed and paid-up Share Capital of Mishapar has been cancelled against the corresponding investments of the Transferee Company. Also, 388 equity shares of Rs. 10 each held by Mishapar in the Transferee Company stands cancelled pursuant to the Scheme.

d) Details of assets and liabilities acquired on amalgamation and treatment of the difference between the fair value of net assets acquired and carrying cost of investment by the Transferee Company in Mishapar:

II. MAFATLAL DENIM LIMITED (MDL):

a) In terms of The Scheme of Arrangement and Amalgamation ("the Scheme”), MDL has been merged with the Company (transferee company), upon which the undertaking and the entire business, including all assets and liabilities of MDL stand transferred to and vested in the Transferee Company. Assets and liabilities so transferred have been recorded in the books of Transferee Company at the book values as recorded in the books of the Transferor Company The amalgamation has been accounted under "Pooling of Interest Method” as envisaged in the Accounting Standard (AS-14) "Accounting for Amalgamations” notified under the Companies (Accounting Standards) Rules, 2006. MDL was engaged in the business of manufacturing and marketing of various denim fabrics and other products.

b) The Scheme filed by the Company has been approved by the Honourable High Court of Judicature at Gujarat, with an appointed date of 1 April, 2012 and an effective date of 28th May 2013 (''the Effective Date''), being the date on which all the requirements under the Companies Act, 1956 have been completed

c) With effect from the appointed date, all the business undertakings, assets, liabilities, rights and obligations of MDL stood transferred to and vested in the transferee company in consideration for issue of 1 equity share of Rs. 10 each in the transferee company for every 10 equity shares of Rs. 10 each held in MDL

d) The assets, liabilities and reserves of MDL as at 1st April 2012 have been taken over at their respective book values on the appointed date as follows

(i) Particulars of assets, liabilities and reserves taken over on amalgamation

(ii) The sum ofRs. 3,634.48 lacs, arrived as above, has been credited to Capital Reserve Account on account of reduction in the capital while issuing the shares to the shareholders of the transferor company as per the ratio prescribed in the Scheme.

In view of the aforesaid amalgamations with effect from 1st April, 2012, the figures for the current year are not comparable with those of the previous period

2.3 During the year 2010-2011, the Company had sold part of its leasehold land at its Mazgaon unit.

The Company is required to surrender the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of V.J.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the agreement, the developer will construct a structure and hand it over to the Company

2.4 Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL), in 2007 the shareholders of the Company are to be issued one equity share of Rs. 10 each, fully paid-up, in SSL for every 500 shares of Rs. 100 each, fully paid-up, held in the Company as consideration for the demerger, aggregating toRs. 1.00 lac. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the rehabilitation scheme sanctioned by BIFR envisages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of Rs. 1.00 lac from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

2.5 Depreciation on fixed assets of (a) the Old Unit at Nadiad and Ahmedabad; and (b) Head Office of the Company, acquired prior to 1-4-1978, was provided on written down value basis and on all other assets, on straight-line basis, as per the provisions of the Companies Act, 1956, at the rates and in the manner specified in Schedule XIV of this Act. The Company has during the previous period changed the method of depreciation retrospectively of the above mentioned fixed assets from WDV to SLM for uniformity in the method of depreciation. Hence depreciation charge for the previous period was higher byRs. 1.93 lacs on account of change in the accounting policy.

2.6 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006:

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors. The Company has not received intimation from most of the suppliers regarding the status under the Micro, Small and Medium Enterprises Development Act, 2006

2.7 As legally advised, the Company had not recognised rent/recovery of expenses ofRs. 186.29 lacs upto 31st March, 2013 (Rs. 181.92 lacs upto 31st March, 2012) pending final resolution of the legal dispute with certain tenants/ex-tenants of a property in South Mumbai. During the financial year 2011, the Hon''ble Small Causes Court had passed Orders for payment of arrears of rent mesne profits and other charges to the Company. Being aggrieved by the said Orders, the Company and the ex-tenants had filed Appeals and Cross-Appeals respectively. During the current year, the Appeals and Cross- Appeals were heard by Appeal Bench of the Hon''ble Small Causes Court and the Company''s appeals were partially allowed. The Company was awarded Rs. 1,222.92 lacs. The Court also awarded interest @ 6% p.a. to be paid to the Company from the date of the filing of the suits till the date of the actual payment of the entire dues. Aggrieved by the above decisions, the ex-tenants filed Civil Revision applications in the Hon''ble Bombay High Court against the orders of the Appeal Bench of the Hon''ble Small Causes Court in awarding an increased amount to the Company. Subsequent to the close of the year, the Hon''ble Bombay High Court has admitted the Civil Revision applications and granted stay on the orders passed by the Appeal Bench of the Hon''ble Small Causes Court.

2.8 In the previous period, pursuant to the Scheme of Amalgamation under Section 391 to 394 of the Companies Act 1956, eight companies had merged with the erstwhile wholly owned subsidiary Mishapar Investments Limited (Mishapar) w.e.f. 1st April 2011 in terms of the Order dated 7th September, 2012 of the Hon''ble High Court of Bombay sanctioning the Scheme. The balances of loans, advances and deposits held by the Company in those amalgamating companies were transferred to Mishapar as at 1st April,2011. Upon this merger, the entire business including assets and liabilities of the amalgamating companies stood transferred to and vested in Mishapar at their book values.

Following companies were amalgamated;

(a) Vibhadeep Investments and Trading Limited

(b) Sushmita Holdings Limited

(c) Mafatlal Holdings Limited

(d) Sunanda Industrial Machinery Limited

(e) Sudas Manufacturing & Trading Limited

(f) Soushreyas Investments (I) Limited

(g) Samatva Investments Limited (h) Navlekh Investments Limited

In terms of the said scheme of amalgamation, the Company was to receive 9,00,000 13.5% Cumulative Preference shares of Rs. 100 each of Mishapar Pending issue of such shares, the amount was disclosed under Non-current Investments as preference shares suspense in the previous period. During the current year, these were converted into preference share capital and duly allotted to the Company. Pursuant to the Scheme of Amalgamation with Mishapar (Refer Note no. 30.3), these investments in preference shares were cancelled against the preference share capital in Mishapar

2.9 In the previous period, the Company had changed the method of valuation of trading goods from First -In- First- Out (FIFO) to Weighted Average Cost (WAC) method for achieving greater uniformity. The change had no impact as there was no closing stock of trading goods.

2.10 Disclosure as per Clause 32 of the Listing Agreements with the Stock Exchanges

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

3.1 Segment Information

Disclosures relating to segment information have been made in the notes forming part of the Consolidated financial statements.

3.2 Employee benefit plans

a) Defined contribution plans

Contributions are made to Recognized Provident Fund / Government Provident Fund and Family Pension Fund which covers all regular employees. Contribution is also made in respect of executives to a Recognized Superannuation Fund. While both the employees and the Company make predetermined contributions to the Provident Fund, contribution to the Family Pension Fund and Superannuation Fund are made only by the Company. The contributions are normally based on a certain proportion of the employee''s salary. Amount recognized as expense in respect of these defined contribution plans, aggregate to Rs. 526.68 lacs (Previous period Rs. 355.80 lacs).

b) Defined benefit plans

Contributions are made to a Recognized Gratuity Fund in respect of gratuity based upon actuarial valuation done at the year end of every financial year using "Projected Unit Credit” method and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation. Gains and losses on changes in actuarial assumptions are accounted for in the Statement of Profit and Loss.

The charge on account of provision for gratuity has been included in ''Employee Benefit Expense'' in the Statement of Profit and Loss.

3.3 Related Parties Transactions

Details of Related Parties

A Subsidiary Companies

Ibiza Industries Limited (also a joint venture) currently under liquidation

Sunanda Industries Limited (direct subsidiary since 01.04.2012) (In the previous period, subsidiary through wholly owned subsidiary, Mishapar Investments Limited) currently under liquidation.

Mayflower Textiles Private Limited (direct subsidiary since 01.04.2012) (In the previous period subsidiary through wholly owned subsidiary, Mishapar Investments Limited)

Myrtle Textiles Private Limited (direct subsidiary since 01.04.2012) (In the previous period subsidiary through wholly owned subsidiary, Mishapar Investments Limited)

Repal Apparel Private Limited (direct subsidiary since 01.04.2012) (In the previous period subsidiary through wholly owned subsidiary, Mishapar Investments Limited)

Mafatlal Services Limited

Mafatlal Global Apparel Limited (since 01.04.2011 through wholly owned subsidiary, Mishapar Investments Limited) (till 29.09.2012)

Silvia Apparel Limited (till 30.03.2013)

Mishapar Investments Limited (till 31.03.2012) (wholly owned subsidiary which amalgamated with the Company). B Jointly Controlled Entities

AL Fahim Mafatlal Textiles LLC- A Joint Venture with Al Fahim Linez LLC- (UAE) (Refer Note no. 31.6) C Associates

Mafatlal VK Intex Limited

Mafatlal Engineering Industries Limited- currently under liquidation

Mafatlal Limited - (Incorporated in United Kingdom)- currently under liquidation

Sushmita Engineering and Trading Limited

Mafatlal Global Apparel Limited (since 29.09.2012)

Repos Trading Company Limited D Key Management Personnel

Hrishikesh A. Mafatlal

Rajiv Dayal ( w.e.f. 01.04.2012) *

Vishad P. Mafatlal (w.e.f. 01.04.2012) **

* In the position of Managing Director in erstwhile Mafatlal Denim Limited, the amalgamating Company.

** In the position of Joint Managing Director in erstwhile Mafatlal Denim Limited, the amalgamating Company. E Relatives of Key Management Personnel

Priyavrata H. Mafatlal

Vishad P. Mafatlal

F Enterprises over which key management personnel and their relatives are able to exercise significant influence NOCIL Limited

Navin Fluorine International Limited

Sulakshana Securities Limited

Krishnadeep Housing Development Private Limited

Mafatlal Impex Private Limited

Mafatlal Denim Limited (till 31.03.2012, since amalgamated with the Company pursuant to the Scheme of Amagamation Refer No no. 30.3)

Myrtle Chemtex Trading Private Limited

4.1 a) Mafatlal Denim Limited (MDL), the erstwhile company which has amalgamated with the Company had re-appointed Mr.Rajiv Dayal as Managing Director & Chief Executive Officer and Mr.Vishad P.Mafatlal as Joint Managing Director of MDL with effect from April 1, 2011 for a term of 5 years. Managerial remuneration of Rs. 139.28 lacs had been paid during the year 2011-12. As stipulated by the provisions of the Companies Act, 1956 requiring the approval of the Central Government for appointment and remuneration of Managerial personnel in the case, inter alia, of a company that is in default in payment of its debts, the erstwhile MDL had made the applications to the Government on June 20, 2011 seeking approval for the re-appointment and payment of remuneration to Mr. Rajiv Dayal and Mr. Vishad P. Mafatlal.

The erstwhile MDL was technically in default to SICOM Limited, a Secured lender pending the Sanction of the Section 391 Scheme pending before the Hon''ble Gujarat High Court. SICOM declined to give their No Objection Certificate for the re- appointments for the reason that they already had their debts adjudicated by the Hon''ble Debt Recovery Tribunal, Mumbai. The Government rejected the applications of MDL on September 23, 2011 for the reason that MDL had not submitted No Objection Certificate from SICOM, one of the Secured lenders. MDL has made an application for reconsideration, as default to the secured lenders no longer exists.

Subsequently, SICOM Limited assigned the entire Debt in favour of M/s. Mishapar Investments Limited (another Company that amalgamated with the Company) on July 26, 2012. Thereafter, MDL obtained the No Objection Certificate from the said assignee and approached the MCA once again on September 5, 2012. Pursuant to the said letter, MCA advised MDL to file the applications afresh. Accordingly, MDL has filed Fresh Applications on October 25, 2012 and awaits their approval. b) An amount of Rs. 964.05 lacs waived by SICOM Limited at the time of assignment has been accounted as Reliefs and concessions on assignment of Liabilities.

4.2 Mr Rajiv Dayal and Mr Vishad P. Mafatlal have been appointed as the managing director and joint managing director respectively in the Board Meeting held on 30th May 2013. Their appointment is subject to the shareholders'' approval at the ensuing Annual General Meeting.

4.3 The Ministry of Corporate Affairs, Government of India, vide General Circular No.2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with Section 212 of the Companies Act,1956, subject to fulfilment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

4.4 The figures for the financial year 2012-13, includes the figures of erstwhile Mafatlal Denim Limited and erstwhile Mishapar Investments Limited which have been amalgamated with the company with effect from 1st April 2012. The figures for the current financial year 2012-13 are for twelve months and figures for the previous period are for nine months. Hence the current year figures are not comparable with the previous period figures.

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

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Mar 31, 2012

1. Corporate Information

Mafatlal Industries Limited (the Company) is a public limited company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on the Bombay and Ahmedabad stock exchanges. The Company belongs to the reputed industrial house of Arvind Mafatlal Group in India, established in 1905. The Company is engaged in textile manufacturing having its operating units at Nadiad and Navsari.

a.(i) Terms / rights attached to Equity shares:

The Company has only one class of equity shares having a par value of Rs.107- per share. Each equity shareholder is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the period ended 31st March, 2012, the amount of dividend, per share, recognized as distributions to equity shareholders is Rs. NIL (period ended 30th June, 2011 Rs. NIL).

(ii) Terms / rights attached to Preference shares:

In terms of Modified Scheme (MS) approved by BIFR. In June 2009 600,00,000 Fully Redeemable Non-Cumulative Preference Shares of Rs. 10/- each are redeemable over a period of eight years as a subordinated liability to the dues of workers, statutory agencies and the secured creditors. 50% of the shares were redeemed during the period. Upon, declaration these shares carry a rate of dividend of 1% from the financial year commencing on or after 1st January, 2014.

b. During 1987-88, 535,000 shares (of Rs. 100/- each) were allotted on rights basis subject to the result of suit nos. 3181 and 3182 of 1987 filed by three shareholders against the Company and Others in the Ahmedabad City Civil Court. The suits are pending disposal.

c. During the period of 14 months ended 31st May, 2010, in terms of Modified Scheme (MS) approved by BIFR, 300,00,000 Optionally Convertible Fully Redeemable Non-Cumulative Preference Shares of Rs. 10/- each were converted into 48.13,860 Equity Share of Rs.10/- each of the Company at a premium of Rs.52.32 per equity share.

d) Balances with earmarked accounts include deposits amounting to Rs. 2,78117 lacs (as at 30th June, 2011 Rs. Nil) and Fixed Deposits account current period Rs. Nil (as at 30th June, 2011 Rs. 33.88 lacs) which have an original maturity of more than 12 months.

(ii) Earmarked accounts

(a) includes Rs. 2.031.94 lacs in Fixed Deposit Escrow Account and Rs. 409.23 lacs in escrow current account (operated under the supervision of Monitoring Committee constituted by the Govt, of Maharashtra under Development Control Regulations, 1991) (as at 30th June, 2011 Rs. 60,616.13 lacs)

(b) Includes Rs. 2,781.77 lacs in Fixed Deposits accounts (as at 30th June, 2011 Rs. 0.83 lacs) over which the banks have Hen.

2.1 (a) During the previous period, the Company had concluded an Agreement with Gliders Buildcon LLP ('the developer'), an entity of Ajay Ptramal Group, on 17th June, 2011 for transfer of development rights in leasehold land at its Mazgaon unit, admeasuring about 30,910 square meters for a lump sum consideration of Rs. 60,580.00 lacs. The proceeds from the development agreement (to the extent pertaining to leasehold land held as stock in trade) amounting to Rs. 48,326.87 lacs for the previous period has been included in Note 21 'Revenue from Operations- Sate of Products.' The remaining proceeds (pertaining to leasehold land held as fixed assets) amounting to Rs. 12,202.86 lacs (net of book value of leasehold land amounting to Rs. 0.01 lac and portion of building amounting to Rs. 50.26 lacs on date of sale) for the previous period is included in 'Profit on sale of Fixed assets' under Note 28 'Exceptional Items (net)'. As required by the Development Control Rules, Government of Maharashtra, the utilization of sales proceeds from sale of textile mill lands is being monitored by a Monitoring Committee appointed by the Government of Maharashtra under Development Control Regulations, 1991.

2.2 (b) The Company is required to surrender the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of V.J.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the abovementioned agreement, the developer will construct a structure and hand it over to the Company.

2.3 In the previous period, the Board for Industrial and Financial Reconstruction (BIFR) vide its order dated 19th August, 2010 discharged the Company from the purview of Sick Industrial Companies (Special Provisions ) Act,1985 (SICA) / (BIFR) consequent to the networth of the Company turning positive.

2.4 Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL), the shareholders of the Company are to be i issued one equity share of Rs. 10/- each, fully paid-up, in SSL for every 500 shares of Rs. 100/- each, fully paid-up, held in the Company as consideration for the demerger, aggregating to Rs. 1.00 lac. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the rehabilitation scheme sanctioned by BIFR envisages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of Rs. 1.00 lac from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

2.5 The Ahmedabad Unit of the Company has discontinued operations with effect from 1st March, 2003. On 21st May, 2003, the Company entered into an 'Agreement ' to Sell' with Annapurna Polymers Private Limited (APPL) for this Unit at an aggregate consideration of Rs. 677.70 lacs. The sale, after getting all approvals, was to be completed on or before 31 st December, 2003. Pending this, a separate 'Conducting Agreement' was entered with APPL, effective 1 st June, 2003, under which APPL operated the Unit on the Company's behalf. The conducting agreement was extended from time to time. The said sale was completed on 14th December, 2010 and the profit of Rs. 611.76 lacs on sale of unit and profit on sale of building of Rs. 24.31 lacs had been recognized in the previous period.

2.6 Depreciation on fixed assets of (a) the Old UnitatNadiad and Unit at Ahmedabad; and (b) Head Office of the Company, acquired prior to1-4-1978, was provided on written down value basis and on all other assets, on straight-line basis, as per the provisions of the Companies Act, 1956, at the rates and in the manner specified in Schedule XIV of this Act. The Company has during the period changed the method of depreciation retrospectively of the above mentioned fixed assets from WDV to SLM for uniformity in the method of depreciation. Depreciation for the period is higher by Rs. 1.93 lacs (Previous period Rs.NIL) on account of change in the accounting policy.

2.7 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

The Company has not received intimation from most of the suppliers regarding the status under the Micro, Small and Medium Enterprise Development Act, 2006, and hence disclosure requirements in this regard as per Schedule VI. of the Companies Act, 1956 is not being provided. Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

2.8 As legally advised, the Company has not recognised rent / recovery of expenses of Rs. 181.92 lacs (Rs. 178.65 lacs upto 30th June, 2011) pending final resolution of the legal dispute with certain tenants/ex-tenants of a property in South Mumbai. During the financial period 2011, the Hon'ble Court of Small Causes Court has passed Orders for payment of arrears of rent mesne profits and other charges to the Company. Being aggrieved by the said Orders, the Company and the ex-tenants have filed Appeals and Cross-Appeals respectively which have been admitted and are pending for final hearing.

2.9 Pursuant to tie scheme of Amalgamation (the Scheme) under section 391 to 394 of the Companies Act 1956 (the Act) the erstwhile following companies (Amalgamating Companies) merged with the wholly owned subsidiary Mishapar Investments Limited (Mishapar) (the Amalgamated Company) w.e.f. 1st April 2011, (the Appointed date) in tarn; of order dated 7th September, 2012 of the Hon'ble High Court of Bombay sanctioning the Scheme. The balances held in the Transferor Companies have been transferred to the Subsidiary company on the appointed date. Upon this merger the entire business including assets and liabilities of the Transferor Companies stand transferred to and vested in the Amalgamated Company at their book values. The following Companies have been Amalgamated:-

a) Vibhadeep Investments & Trading Limited

b) Sushmita Holdings Limited

c) Mafatlal Holdings Limited

d) Sunanda Industrial Machinery Limited

e) Sudas Manufacturing & Trading Limited

f) Soushreyas Investments (I) Limited

g) Samatva Investments Limited

h) Navlekh Investment Limited

In terms of the scheme, the Company is to receive 9,00,000 13.5% Cumulative Preference shares of Rs. 100/- each of Mishapar Investments Limited (the subsidary), pending issue of such shares the amount has been disclosed under Non-current Investments as preference shares suspense.

2.10 In the current period the Company has changed the method of valuation of trading goods from FIFO to weighted average cost method for achieving greater uniformity and hence changed the accounting policy. This change has no impact as there is no closing stock of trading goods.

3.1 Employee benefit plans

a) Defined contribution plans

Contributions are made to Recognized Provident Fund / Government Provident Fund and Family Pension Fund which covers all regular employees. Contribution is also made in respect of executives to a Recognized Superannuation Fund. While both the employees and the Company make predetermined contributions to the Provident Fund, contribution to the Family Pension Fund and Superannuation Fund are made only by the Company. The contributions are normally based on a certain proportion of the employee's salary. Amount recognized as expense in respect of these defined contribution plans, aggregate to Rs.355.80 lacs (Previous period Rs. 566.85 lacs).

b) Defined benefit plans

Contributions are made to a Recognized Gratuity Fund in respect of gratuity based upon actuarial valuation done at the year end of every financial year using "Projected Unit Credit" method and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation. Gains and losses on changes in actuarial assumptions are accounted for in the Statement of Profit and Loss. The charge on account of provision for gratuity has been included in 'Employee Benefit Expense' in the Statement of Profit and Loss.

Compensated Absences

All the employees are eligible for compensated absences of 30 days in each financial year which can be encashed during the tenure of employment. Employees cannot carry forward any compensated absences in excess of 300 days. The provision for these absences, made on the basis of Actuarial Valuation on "Projected Unit Credit" method is Rs. 300.49 lacs (Previous period Rs. 274.24 lacs.) charge for the perio Rs.198.21 lacs (Previous period Rs. 203.30 lacs).

Note 3.2

Related Parties transactions Details of Related Parties A Subsidiary companies

Ibiza Industries Limited (also a joint venture) (Currently under Liquidation)

Mishapar Investments Limited

Sunanda Industrial Machinery Limited (till 01.04.2011)

Sudas Manufacturing & Trading Limited (till 01.04.2011)

Mafatlal Services Limited

Mafatlal Global Apparel Limited (since 01.04.2011 through wholly owned subsidiary, Mishapar Investments Limited)

Silvia Apparel Limited (since 01.04.2011 through wholly owned subsidiary, Mishapar Investments Limited)

Mayflower Textiles Private Limited (since 01.04.2011 through wholly owned subsidiary, Mishapar Investments Limited)

Mrytle Textiles Private Limited (since 01.04.2011 through wholly owned subsidiary, Mishapar Investments Limited)

Sunanda Industries Limited (since 01.04.2011 through wholly owned subsidiary, Mishapar Investments Limited)

Repal Apparel Private Limited (since 01.04.2011 through wholly owned subsidiary, Mishapar Investments Limited) B Associates Mafatlal VK Intex Limited

Sunanda Industries Limited (till 01.04.2011)

Mafatlal Holdings Limited (till 01.04.2011)

Mafatlal Engineering Industries Limited

Mafatlal Limited (Incorporated in United Kingdom)

Repal Apparel Private Limited (till 31.03.2011)

Sushmita Engineering and Trading Limited

Sumish Associates (till 01.04.2011)

Sushmita Holdings Limited (till 01.04.2011) C Enterprises over which key management personnel and their relatives are able to exercise significant influence

Ensen Holdings Limited

NOCIL Limited

Marigold International Private Limited

Navlekh Investment Limited (till 01.04.2011)

Navin Fluorine International Limited

Romago AG, Zurich

Sulakshana Securities Limited

Vibhadeep Investments & Trading Limited (till 01.04.2011)

Krishnadeep Housing Development Private Limited

Urvija Associates

Mafatlal Impex Private Limited

Eyeindia.Com Private Limited

Mafatlal Denim Limited

Sushripada Investments Private Limited

Mafatlal Fabrics Private Limited D Key managerial personnel

Hrishikesh A. Mafatlal E -Relatives of Key Management Personnel

Priyavrata H. Mafatlal (w.e.f 01.01.2011)

---

Jun 30, 2011

As at 31st May, 2010 Rupees Rupees in lacs in lacs

1. Contingent liabilities, in respect of:

a. Bills of exchange discounted 217.03 219.40

b. Demands of income-tax and wealth tax authorities disputed in appeals (mainly relate to disallowance of investment/ loan write off, claim of interest on refund of excise duty/ sales tax, disallowance of chapter VIA deductions, etc. (pending before the Income-Tax Appellate Tribunal/ High Court)) 669.35 989.46

c. Demands under excise and other proceedings disputed in appeals [mainly relating to matters like differential duty on revision of assessable value of yarn captively consumed, duty on T.C. hard waste, duty on drill etc. (pending at various stages, from Assistant Commissioner to CESTAT)] 2697.21 2603.36

d. Claims against the Company not acknowledged as debts (relating to dispute on fixed water charges and interest claimed at Navsari and Nadiad unit) 2673.22 677.51

e. Concessional customs duty on import of machinery under EPCG Scheme payable subject to fulfillment of mandatory import/ export obligation (including interest upto Balance Sheet date) 1027.39 970.76

f. Claims made by workers against the Company (mainly relating to matters like termination, compensation etc.) 1101.12 1116.95

g. Demands from Director General of Foreign Trade against Advance License 311.56 384.97

h Stamp duty on Amalgamation of Company - 1229.47

In the above matters (2b). to (2g), (Previous period (2b) to (2h)) the Company is hopeful of succeeding and as such does not expect any significant liability to crystallize.

i. Guarantees given on behalf of Subsidiary Company – Ibiza Industries Limited 850.28 850.28

2. a) The Company has concluded an Agreement with Gliders Buildcon LLP (‘the developer'), an entity of Ajay Piramal Group, on 17th June, 2011 for transfer of development rights in leasehold land at its Mazgaon unit, admeasuring about 30,910 square meters for a lump sum consideration of Rs. 60,580.00 lacs. The proceeds from the development agreement (to the extent pertaining to leasehold land held as stock in trade) amounting to Rs. 48,326.87 lacs has been included in ‘Turnover.' The remaining proceeds (pertaining to leasehold land held as fixed assets) amounting to Rs. 12,202.86 lacs (net of book value of leasehold land amounting to Rs 0.01 lac and portion of building amounting to Rs 50.26 lacs on date of sale) is included in ‘Profit on sale of fixed assets' under Schedule 13 ‘Other Income'. As required by the Development Control Rules, Government of Maharashtra, the utilization of sales proceeds from sale of textile mill lands is being monitored by a Monitoring Committee appointed by the Government of Maharashtra under Development Control Regulations, 1991.

b) The Company is required to surrender the remaining leasehold land (reserved portion admeasuring about 27,287.82 square meters) to Municipal Corporation of Greater Mumbai for the purpose of extension of V.J.B. Udyan. The Company is also required to recommence the spinning unit which can accommodate 10,000 spindles. By virtue of the abovementioned agreement, the developer will construct a structure and hand it over to the Company.

3 (a)The Board for Industrial & Financial Reconstruction (BIFR) had declared the Company, a sick industrial undertaking, within the meaning of section 3(1)(o) of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA) on 19th September, 2000. It sanctioned a scheme for rehabilitation ('the sanctioned scheme' (SS)) of the Company on 30th October, 2002. The Company had taken several steps for implementation of the SS, but certain delays occurred in completion of reorganization of charges. Hence, at the directive of BIFR, the Company initiated the process of modifying the SS. BIFR vide their Order dated 24th / 25th June 2009 approved the Modified Scheme (MS) in terms of provisions of section 18(4) read with section 19(3) of SICA. The Company has initiated the process of sale of surplus assets identified in the MS. Based on the Audited Accounts on 31st May, 2010, wherein networth of the Company had turned positive, the company made an application to the BIFR for deregistration of its reference. BIFR vide its order dated 19th August, 2010 discharged the Company from the perview of SICA/BIFR.

(b)Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL), the shareholders of the Company are to be issued one equity share of Rs. 10/- each, fully paid-up, in SSL for every 500 shares of Rs. 100/- each, fully paid-up, held in the Company as consideration for the demerger, aggregating to Rs. 1.00 lac. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the SS envisages that these shares would be acquired by Navin Fluorine International Limited (NFIL) and the shareholders of the Company would receive proportionate payment in consideration thereof. The Company has received the said amount of Rs. 1.00 lac from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

4. Tax provision for the current period 1st June, 2010 to 30th June, 2011 has been made after considering various deductions including brought forward business loss available under the Income Ta x Act, 1961.

5. During 1987-88, 535,000 shares (of Rs. 100/- each) were allotted on rights basis subject to the result of suit nos. 3181 and 3182 of 1987 filed by three shareholder against the Company and Others in the Ahmedabad City Civil Court. The suits are pending disposal.

6. The Ahmedabad Unit of the Company has discontinued operations with effect from 1st March, 2003. On 21st May, 2003, the Company entered into an ‘Agreement t Sell' with Annapurna Polymers Private Limited (APPL) for this Unit at an aggregate consideration of Rs. 677.70 lacs. The sale, after getting all approvals, was to b completed on or before 31st December, 2003. Pending this, a separate ‘Conducting Agreement' was entered with APPL, effective 1st June, 2003, under which APP operated the Unit on the Company's behalf. The conducting agreement was extended from time to time. The said sale has been completed on 14th December, 201 and the profit of Rs. 611.76 lacs has been recognized during the period.

7. Depreciation on fixed assets of (a) the Old Unit at Nadiad and Unit at Ahmedabad; and (b) Head Office of the Company, acquired prior to1-4-1978, is provided o written down value basis and on all other assets, on straight-line basis, as per the provisions of the Companies Act, 1956, at the rates and in the manner specifie in schedule XIV of this Act.

8. Payments to and Provisions for Employees includes Rs.4.18 lacs, which is subject to approval by way of special resolution at the forthcoming Annual Genera Meeting under section 314 of Companies Act, 1956.

9. Short Term loan from Bank is obtained by placing Fixed Deposit of Mafatlal Industries Employee's Co-operative Credit Society at Nadiad as collateral.

10. a. The net amount of exchange difference included in the Profit and Loss account for the period is Rs.4.40 lacs gain (Previous period, Rs. 3.97 lacs (Loss)).

11 Research and development expenditure debited to the Profit and Loss account by charge to relevant heads of account amount to Rs.28.12 lacs (Previous period, Rs. 31.42 lacs).

12. In the Modified Scheme, the Company has sought various reliefs and concessions from various authorities and parties, which the BIFR has endorsed it for their consideration. Labour matters pending in various Courts will continue and any decree / award will be acceptable to both the Company and workers.

13. The Company has not received intimation from most of the suppliers regarding the status under the Micro, Small and Medium Enterprise Development Act, 2006, and hence disclosure requirements in this regard as per schedule VI of the Companies Act, 1956 is not being provided.

14. The Company had issued legal notices to certain tenants/ ex-tenants in its buildings in South Mumbai for revision in rent/ recovery of expenses. Pending settlement with them, rent, of Rs.2.11 lacs, aggregate to date as at 30th June, 2011, Rs.39.95 lacs (previous period, Rs. 2.27 lacs, aggregate to date as at 31st May, 2010, Rs. 37.84 lacs) and recovery of expenses, of Rs.2.61 lacs, aggregate to date as at 30th June, 2011, Rs.138.70 lacs (previous period, Rs. 5.36 lacs, aggregate to date as at 31st May, 2010, Rs.136.09 lacs) have not been accounted, on legal advice.

15. Figures for the current period are for thirteen months and figures for the previous period are for fourteen months. Hence the same are not strictly comparable.

16. Employee benefits:

Contributions are made to Government Provident Fund and Family Pension Fund which covers all regular employees. Contribution is also made in respect of executives to a Recognized Superannuation Fund. While both the employees and the Company make predetermined contributions to the Provident Fund, contribution to the Family Pension Fund and Superannuation Fund are made only by the Company. The contributions are normally based on a certain proportion of the employee's salary. Amount recognized as expense in respect of these defined contribution plans, aggregate to Rs.566.85 lacs (Previous period Rs.552.97 lacs).

As per the guidance provided by the Accounting Standards Board of the Institute of Chartered Accountants of India on implementing AS 15, Employee Benefits (revised 2005) states that benefit involving employer established provident fund, which require interest shortfalls to be compensated, are to be considered as defined benefit plans. Pending issuance of the guidance note from the Actuarial Society of India, the Company's actuary has expressed an inability to reliably measure provident fund liabilities. Accordingly the Company is unable to exhibit the related information.

Contributions are made to a Recognized Gratuity Fund in respect of gratuity and provision is made for compensated absences based upon actuarial valuation done at the end of every financial year using ‘Projected Unit Credit' method and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation. Gains and losses on changes in actuarial assumptions are accounted for in the Profit and Loss account.

The charge on account of provision for gratuity and compensated absences has been included in ‘Contribution to Gratuity Fund' and ‘Salaries, Wages and Bonus' respectively.

Break-up of Plan Assets:

The fair value of the plan assets is distributed in the following manner:

- 53 % (Previous Period 64 %) in deposits with a nationalised bank

- 47% (Previous Period 36%) in various debt instruments

Compensated Absences:

All the employees are eligible for compensated absences of 30 days in each financial year which can be encashed during the tenure of employment. Employees cannot carry forward any compensated absences in excess of 300 days. The provision for these absences, made on the basis of Actuarial Valuation on ‘Projected Unit Credit' method is Rs. 274.24 lacs. (Previous period Rs.227.87 lacs)

17. Related party transactions

Names of the related parties where control exists

Subsidiary companies

Ibiza Industries Limited (also a joint venture) (Currently under Liquidation)

Mishapar Investments Limited

Sunanda Industrial Machinery Limited

Sudas Manufacturing & Trading Limited

Mafatlal Services Limited

Names of other related parties and description of relationship where transactions have taken place during the period

Subsidiary companies

Ibiza Industries Limited (also a joint venture) (Currently under Liquidation)

Mishapar Investments Limited

Sunanda Industrial Machinery Limited

Sudas Manufacturing & Trading Limited

Mafatlal Services Limited

Associates

Hybrid Financial Services Limited (formerly known as Mafatlal Finance Company Limited) (till 18th February, 2010)

Mafatlal VK Intex Limited

Sunanda Industries Limited

Sushmita Holdings Limited

Mafatlal Engineering Industries Limited

Mafatlal Limited - UK

Repal Apparel Private Limited

Sushmita Engineering and Trading Limited

Mafatlal Holdings Limited (till 30.11.2010)

Mafatlal Global Apparel Limited (w.e.f 22.03.2011)

Sumish Associates

Enterprises over which key management personnel and their relatives are able to exercise significant influence

Ensen Holdings Limited

NOCIL Limited

Marigold International Private Limited

Navlekh Investment Limited

Navin Fluorine International Limited

Romago AG, Zurich

Sulakshana Securities Limited

Vibhadeep Investments & Trading Limited

Krishnadeep Housing Development Private Limited

Urvija Associates

Mafatlal Impex Private Limited

Eyeindia.Com Private Limited

Mafatlal Denim Limited

Mafatlal Holdings Limited ( w.e.f. 30.11.2010)

Key managerial personnel Hrishikesh A. Mafatlal

Relatives of Key Management Personnels Priyavrata H. Mafatlal (w.e.f. 01.01.2011)

Mishapar Investments Ltd.(wholly owned subsidiary of the Company) hold 12,66,670 Equity Shares of Rs.10/- each in Ibiza Industries Ltd. Hence the combined share of the Company and its subsidiary in Ibiza Industries Ltd. is 54.89%. Ibiza Industries Limited is under liquidation as per Order dated 26th April, 2007 passed by the Hon'ble Bombay High Court while admitting winding up petition. Hence, the details of Ibiza Industries Limited are not given in the above statement.

---

May 31, 2010

As at 31st

March, 2009

Rupees Rupees

in lacs In lacs

1. Estimated contracts remaining to be executed on capital account and not provided for - 363.64

2. Contingent liabilities, in respect of:

a. Bills of exchange discounted 219.40 176.32

b. Demands of income-tax and wealth tax authorities disputed in appeals (mainly relate to disallowance of investment/ loan write off, claim of interest on refund of excise duty/ sales tax, disallowance of chapter VIA deductions, etc. (pending

before the Income-tax Appellate Tribunal/High court)) 989.46 989.46

c. Demands under excise and other proceedings disputed in appeals (mainly relating to matters like differential duty on revision of assessable value of yarn captively consumed, duty on T.C. hard waste, duty on drill etc. (pending at various stages, from Assistant Commissioner to CESTAT) 2603.36 2,710.98

d. Claims against the Company not acknowledged as debts (relating to dispute on fixed water charges at Navsari Unit) 677.51 635.48

e. Concessional customs duty on import of machinery under EPCG Scheme payable subject to fulfillment of mandatory „ import/export obligation (including interest upto Balance Sheet date) 970.76 911.00

f. Claims made by workers against the Company (mainly relating to matters like termination, compensation etc.) 1116.95 1,417.20

g. Demands from Director General of Foreign Trade against Advance License 384.97 381.05

h Stamp duty on Amalgamation of company 1229.47 -

i. Guarantees given on behalf of Subsidiary Company - Ibiza Industries Limited 850.28 850.28

In the above matters (2b. to 2h.), the Company is hopeful of succeeding and as such does not expect any significant liability to crystallize.

3 (a) The Board for Industrial & Financial Reconstruction (BIFFt) had declared the Company, a sick industrial undertaking, within the meaning of section 3(1)(c of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA) on 19th September, 2000. It sanctioned a scheme for rehabilitation (the sanctioned scheme (SS)) of the Company on 30th October, 2002, issued on 15th November, 2002 and appointed the Industrial Development Bank of India (IDBI) as th Monitoring Agency (MA). The SS envisaged corporate, business and financial restructuring of the Companys business. The Company had taken several step for implementation of the SS, but certain delays occurred in completion of reorganization of charges. Hence, at the directive of BIFR, the Company initiate the process of modifying the SS. BIFR vide their Order dated 24th / 25"1 June 2009 approved the Modified Scheme (MS) in terms of provisions of section 18(4 read with section 19(3) of SICA. The Company has initiated the process of sale of surplus assets identified in the MS.

(b) Pursuant to the demerger of the Real Estate and Investment Business to Sulakshana Securities Limited (SSL), the shareholders of the Company are to b issued one equity share of Rs* TO/- each, fully paid-up, in SSL for every 500 shares of Rs. 100/- each, fully paid-up, held in the Company as consideration fc the demerger, aggregating to Rs. 1.00 lac. As the shareholders of the Company would be entitled to receive only fractional shares of SSL, the SS envisages th: these shares would be acquired by NFIL and the shareholders of the Company would receive proportionate payment in consideration thereof. The Compar has received the said amount of Rs. 1.00 lac from NFIL on behalf of the shareholders, which is pending disbursement upon completion of formalities.

(c) During the previous year, at the behest of the Company, dues aggregating to Rs.50,906.80 lacs were assigned by the lending banks, along with underlyin security and all other rights, title and Entitlements to the Secured Creditors being group companies. Under the MS read with inter se Settlement Agreement, th Secured Creditors had settled their dues at their cost of acquisition of Rs. 13,168.47 lacs. Accordingly, the resultant gain of Rs.37,738.33 lacs was accounts in the previous year.

i. In view of substantia) reliefs & concessions on restructuring of loans and liabilities received by the Company pursuant to the MS approved by the BIFR, as mentioned in Note 5 above and sale surplus on properties, the accumulated tosses have substantially reduced and the net worth of the Company as at balance sheet date has turned positive. Accordingly accounts are prepared on going concern basis.

D. Depreciation on fixed assets of (a) the Old Unit at Nadiad and Unit at Ahmedabad; and (b) Head Office of the Company, acquired prior to1-4-1978, is provided on written down value basis and on all other assets, on straight-line basis, as per the provisions of the Companies Act, 1956, at the rates and in the manner specified In schedule XIV of this Act.

I. The Company holds certain unquoted investments at a cost of Rs.4,052.76 lacs (as at 31st March, 2009, Rs. 4,052.76 lacs) in companies, the networth of whose, as per their latest available audited accounts have been partially/ substantially eroded. Marginal erosion has also taken place in the Companys investment in its wholly-owned subsidiary, Mishapar Investments Limited. During the period, an amount of Rs.4,001.88 lacs has been provided as diminution in the value of unquoted Investments.

Sundry Debtors (Schedule 8), Loans (Schedule 10) and Advances Recoverable in Cash or in kind for the value to be received (Schedule 10) includes overdue amounts of Rs.3,629.59 lacs (as at 31 st March 2009 Rs.3,629.59 lacs), Rs.47S.60 lacs (as at 31 st March 2009 Rs.475.60 lacs) and Rs,210.90 lacs (as at 31 st March 2009 Rs.210.89 lacs) respectively which have since been secured by pledge of shares vide pledge agreement dated 25th June, 2010.

i. a. The net amount of exchange difference included in the Profit and Loss account for the period Is Rs.3.97 lacs (Loss) (previous year, Rs. 484.68 lacs (gain)).

4. The Company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprise Development Act, 2006 and hence disclosure requirements in this regard as per Schedule VI of the Companies Act, 1956 could not be provided,

5. The Company had issued legal notices to certain tenants/ ex-tenants in its buildings in South Mumbai for revision in rent/ recovery of expenses. Pending settlement ¦ with them, rent, of Bs.2.27 lacs, aggregate to date as at 31 st May, 2010, Rs.37.84 lacs (previous year, Rs. 1.95 lacs, aggregate to date as at 31 st March, 2009, Rs. 35.57 lacs) and recovery of expenses, of Rs.5.36 lacs, aggregate to date as at 31st May, 2010, Rs.136.09 lacs (previous year, Rs. 7.51 lacs, aggregate to ddte as at 31st March, 2009, Rs.144.73 lacs) have not been accounted, on legal advice.

6. The Brihanmumbai Municipal Corporation had issued an attachment notice on the Company for its property at Lower Parel, Mumbai for recovery of arrears of property tax. This has been stayed subject to the Company making payment towards outstanding dues on schedule. This has been agreed to by the Company and accordingly all the necessary payments have been made.

7 Tax provision for the current period 1st April 2009 to 31st May, 2010 has been made after considering various deductions including carry forward business loss available under the Income Tax Act, 1961.

8. Employee benefits:

Contributions are made to Government Provident Fund and Family Pension Fund which covers all regular employees. Contribution is also made in respect of executives to a Recognized Superannuation Fund. While both the employees and the Company make predetermined contributions to the Provident Fund, contribution to the Family Pension Fund and Superannuation Fund are made only by the Company. The contributions are normally based on a certain proportion of the employees salary. Amount recognized as expense in respect of these defined contribution plans, aggregate to Rs.552.97 lacs (Previous year Rs.417.15 lacs).

As per the guidance provided by the Accounting Standards Board of the Institute of Chartered Accountants of India on implementing AS 15, Employee Benefits (revised 2005) states that benefit involving employer established provident fund, which require interest shortfalls to be compensated, are to be considered as defined benefit plans. Pending issuance of the guidance note from the Actuarial Society of India, the Companys actuary has expressed an inability to reliably measure provident fund liabilities. Accordingly the Company is unable to exhibit the related information.

Contributions are made to a Recognized Gratuity Fund in respect of gratuity and provision is made for compensated absences based upon actuarial valuation done at the end of every financial year using Projected Unit Credit method and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation* Gains and losses on changes in actuarial assumptions are accounted for in the Profit and Loss account.

The charge on account of provision for gratuity and compensated absences has been included in Contribution to Gratuity Fund and Salaries, Wages and Bonus respectively.

Compensated Absences:

All the employees are eligible for compensated absences of 30 days in each financial year which can be encashed during the tenure of employment. Employees cannot carry forward any compensated absences in excess of 300 days (as at 31st March, 2009, 240 days). The provision for these absences, made on the basis of Actuarial Valuation on Projected Unit Credit method is Rs. 227.87 lacs (Previous year Rs.246.46 lacs).

9- Related party transactions

Names of the related parties where control exists

Subsidiary companies

Ibiza Industries Limited (also a joint venture) (Currently under Liquidation)

Mishapar Investments Limited

Sunanda Industrial Machinery Limited

Sudas Manufacturing & Trading Limited

Mafatlal Services Limited

Names of other related parties and description of relationship where transactions have taken place during the period/year

Subsidiary companies

Ibiza Industries Limited (also a joint venture) (Currently under Liquidation)

Mishapar Investments Limited

Sunanda Industrial Machinery Limited

Sudas Manufacturing & Trading Limited

Mafatlal Services Limited

Associates

Hybrid Financial Services Limited (formerly known as Mafatlal Finance Company Limited) (till 18* February, 2010)

Mafatlal VK Intex Limited

Sunanda Industries Limited

Mafatlal Holdings Limited

Sushmita Holdings Limited

Mafatlal Engineering Industries Limited

Mafatlal Limited - UK

Ftepal Apparel Private Limited

Sushmita Engineering and Trading Limited

Enterprises over which key management personnel and their relatives are able to exercise significant influence

Ensen Holdings Limited

NOCIL Limited

Marigold International Private Limited

Navlekh Investments Limited

Navin Fluorine International Limited

Romago AG, Zurich

Sulakshana Securities Limited

Vibhadeep Investments & Trading Limited

Krishnadeep Housing Development Private Limited

Sumish Associates

Urvija Associates

Mafatlal Impex Private Limited

Eyeindia.Com Private Limited

Mafatlal Denim Limited

10 Figures for the current are for fourteen months and figures for the previous year are for twelve months; hence not comparable.

11 Figures of the previous year have been regrouped, rearranged and/or reclassified wherever necessary to correspond with those of the current period.