Notes to Accounts of Premco Global Ltd.

Mar 31, 2025

10. Provision, Contingent Liabilities, Contingent Assets and Commitments
Provision

Provision are recognized when there is a present obligation (legal or constructive) as a result of a past event and it is probable
that an outflow of benefits will be required to settle the obligation and there is a reliable estimate of the amount of the obligation.
Provisions are recognized at the best estimate of the expenditure required to settle the present obligation at the reporting date.

Contingent liabilities

Contingent liabilities are disclosed when there is a possible but not probable obligation arising from the past events, the
existence of which will be confirmed only on 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 or a reliable estimate of the amount cannot be made. Contingent liabilities do not
warrant provisions but are disclosed unless the possibility of outflow of resources is remote.

Contingent Assets

Contingent assets are disclosed in the financial statements when an inflow of economic benefit is probable. However, when the
realization of income is virtually certain, then the related asset is not a contingent asset and its recognition is appropriate

Commitments

Commitments are future liabilities for contractual expenditure, classified and disclosed as estimated amount of contracts
remaining to be executed on capital account and not provided for.

11. Income Tax, Deferred Tax

a) Current and Deferred Tax

Tax expense for the period, comprising Current tax and Deferred Tax are included in the determination of net profit or loss
for the period.

Current tax is measured at the amount expected to be paid to the tax authorities in accordance with the taxation laws
prevailing in India.

Deferred Tax is recognized for all the timing differences, subject to the consideration of prudence in respect of deferred tax
assets. Deferred tax assets are recognized and carried forward only to the extent that there is a reasonable certainty that
sufficient future taxable income will be available against which such deferred tax assets can be realized.

Deferred Tax assets and liabilities are measured using the tax rates and tax laws that have been enacted and substantively
enacted by the Balance Sheet date. At each Balance Sheet date, the company re-assesses unrecognized deferred tax
assets, if any.

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

Current and deferred tax is recognized in the statement of profit and loss, except to the extent that it relates to items
recognized in other comprehensive income or directly in equity.

12. Borrowing Cost

Borrowing cost incurred in relation to the acquisition, construction of assets are capitalized as the part of cost of such assets
up to date which such assets are ready for intended use. Other borrowing costs are charged as an expense over the period of
Term Loan.

13. Impairment of Assets

Assessment is done at each Balance Sheet reporting date as to whether there is any indication that a tangible asset may be
impaired. For the purpose of assessing impairment, the smallest identifiable group of asset that generates cash inflows from
continuing use that are largely independent of the cash inflow from other assets or groups of assets, is considered as a cash
generating unit. If any such indication exists, an estimate of the recoverable amount of the asset/cash generating unit is made.

Assets whose carrying value exceeds their recoverable amount are written down to the recoverable amount. Recoverable
amount is higher of an asset’s or cash generating unit’s net selling price and its value in use. Value in use is the present value
of estimated future cash flows expected to arise from the continuing use of an assets and from its disposal at the end of its
useful life. Assessment is also done at each Balance Sheet date as to whether there is any indication that an impairment loss
recognized for an asset in prior accounting periods may no longer exist or may have decreased.

14. Leases (As a lessee)

The Company has adopted Ind AS 116 “Leases” using the modified retrospective approach with effect from initially applying this
standard from 1st April 2019.

The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116 and this may require
significant judgment. The Company also uses significant judgement in assessing the lease term (including anticipated renewals)
and the applicable discount rate.

The Company determines the lease term as the non-cancellable period of a lease, together with both periods covered by an
option to extend or terminate the lease if the Company is reasonably certain based on relevant facts and circumstances that
the option to extend or terminate will be exercised. If there is a change in facts and circumstances, the expected lease term is
revised accordingly.

The discount rate is generally based on the interest rate specific to the lease being evaluated or if that cannot be easily
determined the incremental borrowing rate for similar term is used.

The Company has elected not to recognise right-of-use assets and lease liabilities for short-term leases that have a lease term
of 12 months or less and leases of low-value assets. The Company recognises the lease payments associated with these
leases as an expense on a straight-line basis over the lease term.

The Company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is
initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or
before the commencement date, plus any initial direct costs incurred and restoration cost, less any lease incentives received.

The right-of-use assets are subsequently depreciated over the shorter of the asset’s useful life and the lease term on a straight¬
line basis. In addition, the right-of-use asset is reduced by impairment losses, if any.

The lease liability is initially measured at amortised cost at the present value of the future lease payments. When a lease liability
is re-measured, the corresponding adjustment of the lease liability is made to the carrying amount of the right-of-use asset, or
is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

Lease liability and right-of-use asset have been separately presented in the Balance sheet and lease payments have been
classified as financing cash flows.

15. Cash and Cash Equivalents:

In the Cash flow statement, cash and cash equivalents include cash on hand, demand deposits with bank, other short term
highly liquid investments with original maturity of three months or less.

16. Earnings per share:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by
weighted average number of equity shares outstanding during the period. The Weighted average number of equity shares
outstanding during the period and for all periods presented is adjusted for the events, such as bonus shares, other than
conversion of potential equity share that have changed the number of equity shares outstanding, without a corresponding
change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity share holders
and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential
equity shares.

17. Exceptional items

On certain occasions, the size, type or incidence of an item of income or expense, pertaining to the ordinary activities of the
Company is such that its disclosure improves the understanding of the performance of the Company. Such income or expense
is classified as an exceptional item and accordingly, disclosed in the notes to the financial statements.

18. Segment reporting

The Chief Operating Decision Maker (‘CODM’) monitors the operating results of its business segments separately for the
purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated
based on profit or loss and is measured consistently with profit or loss in the financial statements.

19. Borrowings and Loans

Borrowings and loans are initially recognised at fair value, net of transaction costs incurred. It is subsequently measured at
amortised cost using the effective interest rate method. Amortised cost is calculated by taking into account any discount or
premium on acquisition and fees or transaction costs that are an integral part of the effective interest rate. Any difference
between the proceeds (net of transaction costs) and the redemption amount is recognised in the Statement of profit and loss
over the period of borrowings using the effective interest rate.

20. Financial Instruments

A financial instrument is a contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of
another entity. Financial instruments also include derivative contracts such as foreign currency forward contracts.

1) Financial Assets

i) Classification

The Company classifies its financial assets in the following measurement categories:

a) at fair value either through other comprehensive income (FVOCI) or through profit and loss (FVTPL); and

b) at amortised cost.

The classification depends on the entity’s business model for managing the financial assets and the contractual terms
of the cash flow characteristic of the financial asset.

Gains and losses will either be recorded in the statement of profit and loss or other comprehensive income for assets
measured at fair value.

For investments in debt instruments, this will depend on the business model in which the investment is held.

For investments in equity instruments, this will depend on whether the Company has made an irrevocable election at
the time of initial recognition to account for the equity investment at fair value or through other comprehensive income.

The Company reclassifies debt investments when and only when its business model for managing those assets
changes.

ii) Measurement

At initial recognition, in case of a financial asset not at fair value through the statement of profit and loss account,
the Company measures a financial asset at its fair value plus transaction costs that are directly attributable to the
acquisition of the financial asset. However trade receivables that do not contain a significant financing component
are measured at transaction price. Transaction costs of financial assets carried at fair value through the statement of
profit and loss are expensed in profit or loss.

a) Debt instruments

There are three measurement categories into which the Company classifies its debt instruments:

Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortised cost. Gain or loss on a debt investment
that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in the
statement of profit and loss when the asset is derecognised or impaired. Interest income from these financial
assets is included in other income using the effective interest rate method.

Fair value through other comprehensive income (FVOCI): Assets that are held for collection of contractual
cash flows and for selling the financial assets, where the assets‘ cash flows represent solely payments of
principal and interest, are measured at fair value through other comprehensive income (FVOCI). Movements in
the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest
income and foreign exchange gains and losses which are recognised in profit and loss. When the financial
asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to
the statement of profit and loss and recognised in other income or other expenses (as applicable). Income from
these financial assets is included in other income.

Fair value through profit and loss (FVTPL) : Assets that do not meet the criteria for amortised cost or FVOCI
are measured at fair value through the profit and loss. A gain or loss on a debt investment that is subsequently
measured at fair value through profit and loss and is not part of a hedging relationship is recognised in the
statement of profit and loss and within other income or other expenses (as applicable) in the period in which it
arises. Income from these financial assets being difference of cost & maturity proceeds are included in other
income or other expenses, as applicable.

b) Equity instruments

The Company measures all equity investments (except Equity investment in subsidiaries and joint ventures) at
fair value. The Company‘s management has opted to present fair value gains and losses on equity investments
through profit and loss account. Dividends from such investments are recognised in the statement of profit and
loss as other income when the Company‘s right to receive payments is established.

Changes in the fair value of financial assets at fair value through profit and loss are recognised in other income
or other expenses, as applicable in the statement of profit and loss.

iii) Impairment of financial assets

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at
amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has
been a significant increase in credit risk. For trade receivables only, the company applies the simplified approach
permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognised from initial
recognition of the receivables.

iv) Derecognition of financial assets

A financial asset is derecognised only when -

a) The Company has transferred the rights to receive cash flows from the financial asset or

b) Retains the contractual rights to receive the cash lows of the financial asset, but assumes a contractual obligation
to pay the cash flows to one or more recipients.

Where the company has transferred an asset, it evaluates whether it has transferred substantially all risks and
rewards of ownership of the financial asset. In such cases, the financial asset is derecognised. Where the entity
has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not
derecognized.

Where the company has neither transferred a financial asset nor retains substantially all risks and rewards of
ownership of the financial asset, the financial asset is derecognised if the Company has not retained control of the
financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to
the extent of continuing involvement in the financial asset.

v) Income Recognition
Interest income

Interest income from debt instruments is recognised using the effective interest rate method. The effective interest
rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset
to the gross carrying amount of a financial asset. When calculating the effective interest rate, the company estimates
the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment,
extension, call and similar options) but does not consider the expected credit losses.

Dividend income

Dividends are recognised in the statement of profit and loss only when the right to receive payment is established, it
is probable that the economic benefits associated with the dividend will flow to the Company, and the amount of the
dividend can be measured reliably.

vi) Cash and cash equivalents

Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other short- term,
highly liquid investments with original maturities of three months or less, that are readily convertible to known amounts
of cash and which are subject to an insignificant risk of changes in value.

vii) Trade Receivables

Trade receivables are recognised initially at the transaction price as they do not contain significant financing
components. The Company holds the trade receivables with the objective of collecting the contractual cash flows and
therefore measures them subsequently at amortised cost using the effective interest method, less loss allowance.

2) Financial Liabilities

i) Measurement

Financial liabilities are initially recognised at fair value, reduced by transaction costs (in case of financial liabilities not
recorded at fair value through profit and loss), that are directly attributable to the issue of financial liability. All financial
liabilities are subsequently measured at amortised cost using effective interest method. Under the effective interest
method, future cash outflow are exactly discounted to the initial recognition value using the effective interest rate, over
the expected life of the financial liability, or, where appropriate, a shorter period. At the time of initial recognition, there
is no financial liability irrevocably designated as measured at fair value through profit and loss.

ii) Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When
an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms
of an existing liability are substantially modified, such an exchange or modification is treated as the de-recognition
of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is
recognised in the statement of profit and loss.

iii) Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year
which are unpaid. The amounts are unsecured and are usually paid as per payment terms.

iv) Derivatives and hedging activities

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently
re-measured to their fair value at the end of each reporting period. Resulting gains/(losses) are recorded in statement
of profit and loss under other income/other expenses. Derivatives are classified as a current asset or liability when
expected to be realised/settled within 12 months of the balance sheet date.

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the balance sheet where there is a legally
enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset
and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must
be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Company
or the counterparty.

NOTE : 3A Critical estimates and judgments

In the application of the company‘s accounting policies, which are described in note 2, the management is required to make judgment,
estimates, and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other process.
The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future period if
the revision affects both current and future period.

The following are the critical estimates and judgments that have the significant effect on the amounts recognised in the financial
statements.

Critical estimates and judgments

i) Estimation of current tax expense and deferred tax

The calculation of the company‘s tax charge necessarily involves a degree of estimation and judgment in respect of certain
items whose tax treatment cannot be finally determined until resolution has been reached with the relevant tax authority or, as
appropriate, through a formal legal process. Significant judgments are involved in determining the provision for income taxes,
including amount expected to be paid/recovered for uncertain tax positions. Where the final tax outcome of these matters is
different from the amounts that were initially recorded, such differences will impact the current and deferred income tax in the
period in which such determination is made.

Recognition of deferred tax assets / liabilities

The recognition of deferred tax assets is based upon whether it is probable that sufficient and suitable taxable profits will be
available in the future against which the reversal of temporary differences can be deducted. To determine the future taxable
profits, reference is made to the approved budgets of the company. Where the temporary differences are related to losses, local
tax law is considered to determine the availability of the losses to offset against the future taxable profits as well as whether
there is convincing evidence that sufficient taxable profit will be available against which the unused tax losses or unused tax
credits can be utilised by the company. Significant items on which the Company has exercised accounting judgment include
recognition of deferred tax assets in respect of losses. The amounts recognised in the financial statements in respect of each
matter are derived from the Company‘s best estimation and judgment as described above.

ii) Estimation of Provisions and Contingent Liabilities

The company exercises judgment in measuring and recognising provisions and the exposures to contingent liabilities, which is
related to pending litigation or other outstanding claims. Judgment is necessary in assessing the likelihood that a pending claim
will succeed, or a liability will arise, and to quantify the possible range of the financial settlement.

Because of the inherent uncertainty in this evaluation process, actual liability may be different from the originally estimated as
provision. Although there can be no assurance of the final outcome of the legal proceedings in which the company is involved,
it is not expected that such contingencies will have a material effect on its financial position or profitability.

iii) Estimation of useful life of Property, Plant and Equipment, Intangible assets, Investment properties

Property, Plant and Equipment, Intangible assets, Investment properties represent a significant proportion of the asset base
of the company. The charge in respect of periodic depreciation is derived after determining an estimate of an asset‘s expected
useful life and the expected residual value at the end of its life. The useful lives and residual values of company‘s assets are
determined by management at the time the asset is acquired and reviewed periodically, including at each financial year end.
The useful lives are based on historical experience with similar assets as well as anticipation of future events, which may impact
their life, such as changes in technology.

iv) Estimation of provision for inventory

The company writes down inventories to net realisable value based on an estimate of the realisability of inventories. Write
downs on inventories are recorded where events or changes in circumstances indicate that the balances may not realised.
The identification of write-downs requires the use of estimates of net selling prices of the down-graded inventories. Where the
expectation is different from the original estimate, such difference will impact the carrying value of inventories and write-downs
of inventories in the periods in which such estimate has been changed.

v) Estimation of defined benefit obligation

The present value of the defined benefit obligations depends on a number of factors that are determined on an actuarial basis
using a number of assumptions. The assumptions used in determining the net cost (income) for post employments plans
include the discount rate. Any changes in these assumptions will impact the carrying amount of such obligations.

The company determines the appropriate discount rate at the end of each year. This is the interest rate that should be used to
determine the present value of estimated future cash outflows expected to be required to settle the defined benefit obligations.
In determining the appropriate discount rate, the company considers the interest rates of government bonds of maturity
approximating the terms of the related plan liability.

vi) Estimated fair value of Financial Instruments

The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. The
Management uses its judgment to select a variety of methods and make assumptions that are mainly based on market conditions
existing at the end of each reporting period.

vii) Impairment of Trade Receivable

The impairment provisions for trade receivable are based on assumptions about risk of default and expected loss rates. The
company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the
company’s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

NOTE: 3B New and amended standards adopted by the Company

Ministry of Corporate Affairs (“MCA”) notifies new standards or amendments to the existing standards under Companies (Indian
Accounting Standards) Rules as issued from time to time. For the year ended March 31, 2025, MCA has not notified any new
standards or amendments to the existing standards applicable to the company.

14.2 Terms/Rights Attached to Shares

The company has only one class of equity shares having a par value of Rs. 10/- per share. Each share holder of fully paid equity
shares is entitled to one vote per share. The company declares and pays dividends to the share holders of fully paid equity shares
in Indian rupees. The dividend proposed by Board of Directors is subject to the approval of the shareholders in the ensuing Annual
General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company
after distribution of all preferential amounts, in proportion to their shareholding.

NOTE 35: Contingent Liabilities and Litigations

a) Unredeemed Bank Guarantees & Letter of credit are Rs. 38.18 Lakhs (P.Y. Rs. 34.19 Lakhs)

b) Claims against the company not acknowledged as debts pending outcome of appeals / rectification -
¦ Income Tax Liability Rs. 0.74 Lakhs (P.Y. Rs. 7.83 Lakhs)

c) The company has filed legal suit against debtors towards recovery of Rs. 4.28 Lakhs and the provision for impairment / doubtful
debts has been made for the same. The final realization is subject to outcome of the legal case.

NOTE 36-A:

Capital Commitments:- Estimate amount of contract remaining to be executed on Capital Account & not provided for Rs 24.57
Lakhs (P.Y. Rs 9.56 Lakhs) against which advance has been paid of Rs. 15.13 Lakhs (P.Y. Rs. 5.30 Lakhs)

NOTE 36-B:

Assets Pledged as Security:-The carrying amounts of assets pledged as security for current and non-current borrowing are,

b) Defined benefit plans - Gratuity & Leave Encashment:

Gratuity: - The Company operates a gratuity plan which is administrated through HDFC Standard Life Insurance Company
Limited and a trust which is administrated through trustees. Every employee is entitled to a minimum benefit equivalent to 15
days salary last drawn for each completed year of service in line with Payment of Gratuity act, 1972. The same is payable at
the time of separation from the company or retirement, whichever is earlier or death in service.

Leave Encashment: - The employees are entitled to accumulate compensated absence upto specified days as per company
policy, which is payable at the time of separation from company i.e. retirement or death in service at the rate of last drawn salary.

The details on Company’s Gratuity and Leave Encashment liabilities employees are given below which is certified by the
actuary and relied upon by the auditors.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity and derivative
instruments that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued
using the closing price as at the reporting period.

Level 2: 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. The Company has
mutual funds for which all significant inputs required to fair value an instrument falls under 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 and unlisted preference shares are included in level 3.

There are no transfers between levels 1, 2 and 3 during the year.

(ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

Investments in quoted equity instruments are valued using the closing price at Bombay Stock Exchange (BSE) at the reporting
period.

The fair value of forward foreign exchange contracts is determined using forward exchange rates as at the balance sheet date,
prevailing with authorised dealers dealing in foreign exchange.

The use of Net Assets Value (‘NAV) for valuation of mutual fund investment. NAV represents the price at which the issuer will
issue further units and will redeem such units of mutual fund to and from the investors.

The fair value of the debentures is determined based on present values and the discount rates used were adjusted for
counterparty risk and country risk.

a) The carrying amounts of trade receivables, trade payables, cash and cash equivalents, bank balances other than cash and
cash equivalents, borrowings and other financial liabilities are considered to be the same as their fair values, due to their
short term nature.

b) The fair values and carrying value for equity investments, security deposits, loans, other financial assets and other financial
liabilities are materially the same.

NOTE 47A: Financial risk management

The Company’s activities expose it to market risk, liquidity risk and credit risk. In order to minimize any adverse effects on the
financial performance of the company, derivative financial instruments, such as foreign exchange forward contracts are entered
to hedge certain foreign currency risk exposures. Derivatives are used exclusively for hedging purposes and not as trading or
speculative instruments.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of hedge
accounting in the financial statements.

The company has a robust risk management framework comprising risk governance structure and defend risk management
processes. The risk governance structure of the company is a formal organization structure with defend roles and responsibilities
for risk management.

The Company risk management is carried out by a central treasury department under the guidance from the board of directors.
Company’s treasury identifies, evaluates and hedges financial risks in close coordination with the company’s operating units. The
board provides written principles for overall risk management, as well as policies covering specific areas, such as foreign exchange
risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment
of excess liquidity. There is no change in objectives and process for managing the risk and methods used to measure the risk as
compared to previous year.

1) Credit Risk :

Credit risk is the risk that the counterparty will not meet its obligation under a financial instrument or customer contract, leading
to financial loss. The Credit risk mainly arises receivables from customers, cash and cash equivalents, loans and deposits with
banks, financial institutions & others.

a) Trade receivables and loans

The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs. 913.22
Lakhs as at March 31,2025 (March 31,2024- Rs. 782.91 Lakhs) and from loans amounting Rs. 13.14 Lakhs (March 31,
2024 Rs. 8.23 Lakhs) Trade receivables are typically unsecured and are derived from revenue earned from customers
located in India as well as outside India.

The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses
in respect of trade receivables.

The Company‘s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The
demographics of the customer, including the default risk of the industry, the country and the state in which the customer
operates, also has an influence on credit risk assessment.

Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the credit worthiness
of customers to which the Company grants credit terms in the normal course of business.

The management continuously monitors the credit exposure towards the customers outstanding at the end of each
reporting period to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do
not reflect any significant credit losses. Given that the macroeconomic indicators affecting customers of the Company have
not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

The average credit period on sales of products is less than 90 days. Credit risk arising from trade receivables is managed
in accordance with the Company‘s established policy, procedures and control relating to customer credit risk management.
Credit quality of a customer is assessed based on a detailed study of credit worthiness and accordingly individual credit
limits are defined/modified. For trade receivables, as a practical expedient, the Company computes credit loss allowance
based on a provision table as above.

b) Cash and cash equivalents:

As at the year end, the Company held cash and cash equivalents of Rs. 365.44 Lakhs ( March 31, 2024: Rs. 485.08
Lakhs). The cash and cash equivalents are held with bank and financial institution counterparties with good credit rating.

c) Other Bank Balances:

Other bank balances are held with bank and financial institution counterparties with good credit rating.

d) Loans : The maximum exposure from loans is from loans due to employees and the repayments are regular and neither
past due nor impaired.

e) Other financial assets:

Other financial assets includes security deposits which are neither past due nor impaired.

2) Liquidity Risk :

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Prudent
liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through
an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the
dynamic nature of the underlying businesses.

Company treasury maintains flexibility in funding by maintaining 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.

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market
prices. Market risk comprises three types of risks namely interest rate risk, currency risk and other price risk, such as commodity
risk. The Company is not exposed to interest rate risk whereas the exposure to currency risk and other price risk is given below:

A) Market Risk- Foreign currency risk.

The Company operates internationally and portion of the business is transacted in several currencies and consequently
the Company is exposed to foreign exchange risk through its sales in overseas and purchases from overseas suppliers
in various foreign currencies. Foreign currency exchange rate exposure is partly balanced by maintaining an EEFC
bank account and purchasing of goods, commodities and services in the respective currencies. The Company also uses
foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain
firm commitments, highly probable forecast transactions and foreign currency required at the settlement date of certain
receivables/payables. The use of foreign currency forward contracts is governed by the Company‘s strategy approved by
the board of directors, which provide principles on the use of such forward contracts consistent with the Company‘s risk
management policy and procedures.

(a) Exposure

The company is mainly exposed to the price risk due to its investment in mutual funds and investment in equity
instruments held by the company and classified in the balance sheet as fair value through profit or loss. The investment
in mutual funds are mix of equity and debt based mutual funds. The price risk arises due to uncertainties about the
future market values of these investments. To manage its price risk arising from investments in equity securities and
mutual funds, the company diversifies its portfolio.

(b) Sensitivity

The table below summarizes the impact of increases/decreases of the BSE index on the Company‘s equity and Gain/ Loss
for the period. The analysis is based on the assumption that the index has increased by 5% or decreased by 5% with all
other variables held constant, and that all the company‘s equity instruments / mutual funds moved in line with the index.

Additional Regulatory information.

NOTE 49 :

The disclosure requirements about any transactions not recorded in the books of accounts that has been surrendered or disclosed
as income during the year in the tax assessments under the Income Tax Act 1961 ( such as search or surveyor any other relevant
provision of Income Tax Act 1961 ) is not applicable to the company.

NOTE 50 :

The company has not traded or invested in crypto currency or virtual currency during the financial year.

NOTE 51 :

There are no proceedings which are initiated or pending against the Company for holding any Benami property under the Benami
transactions (Prohibition) Act 1988 & rules made thereunder.

NOTE 52 :

The Company does not have any transactions with companies struck off under section 248 of the Companies Act, 2013 or section
560 of the Companies Act, 1956.

Note 53 :

Utilisation of Borrowed funds and share premium

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

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

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

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

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

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries
Note 54 :

No significant subsequent events have been observed which may require an adjustment to the financial statements.

Note 55 :

The Company has used accounting software for maintaining its books of accounts which has a feature of recording audit trail (edit
log) facility and the same has been operated throughout the year for all relevant transactions recorded in the software. Further, there
are no instance of audit trail feature being tampered during the year.

NOTE 57: Figures of Previous are regrouped and reclassified wherever necessary.

" AS PER OUR ANNEXED REPORT OF EVEN DATE "

S. P. JAIN & ASSOCIATES FOR AND ON BEHALF OF THE BOARD

CHARTERED ACCOUNTANTS

FRN 103969W Sd/- Sd/-

ASHOK B. HARJANI NISHA P. HARJANI

Sd/- CHAIRMAN & MANAGING DIRECTOR DIRECTOR & CFO

DIN - 00725890 DIN - 00736566

KAPIL K. JAIN
PARTNER

M.NO.108521 PLACE: MUMBAI

UDIN - 25108521BMGXUO3039 DATED: 15th MAY, 2025

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Mar 31, 2024

14.2 Terms/Rights Attached to Shares

The company has only one class of equity shares having a par value of Rs. 10/- per share. Each share holder of fully paid equity shares is entitled to one vote per share. The company declares and pays dividends to the share holders of fully paid equity shares in Indian rupees. The dividend proposed by Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

NATURE AND PURPOSE OF EACH RESERVE

Security Premium Reserve - Security premium reserve is used to record the premium on issue of shares. This reserve is utilised in accordance with the provision of the Companies Act 2013.

Capital Reserve - This reserve was created in the financial year 2015-16. Capital reserves are created out of forfeiture of shares and are usually utilised for issue of Bonus shares.

Capital Subsidy Reserve - This reserve was created in financial year 1994-95 of Rs. 637500/- & in finacial year 2004-05 of Rs. 1640600/- and created out of capital subsidy received by the company.

The reserve is to be usually created for use of Bonus shares or to adjust capital losses.

General Reserve - General Reserve is a free reserve and is available for distribution as dividend, issue of bonus shares, buyback of the companies securities. It was creaetd by transfer of amounts out of distributable profits, from time to time.

16.1 DETAILS OF SECURITY AND TERMS OF REPAYMENT

(a)HDFC BANK - Term Loans referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra

(c) Working capital referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra.

16.2 The term loan have been sanctioned for the purpose of purchase / import of plant & machinery and the same has been fully used in accordance with the stated purpose.

Note : During the year ended 31st March, 2020, the Government of India vide Taxation Laws (Amendment) Tax Ordinance, 2019 allowed an option to the domestic companies to switch to a lower tax rate structure of 22% (25.17% including surcharge and cess) from the earlier 25% (27.82% including surcharge and cess) subject to condition that the Company will not avail any of the specified deductions / incentives under the Income Tax Act. The Company has elected to new regime of lower tax rate from FY 2020-21 and filed tax returns accordingly.

NOTE 35: Contingent Liabilities and Litigations

a) Unredeemed Bank Guarantees & Letter of credit are Rs. 34.19 Lakhs (P.Y. Rs. 23.13 Lakhs)

b) Claims against the company not acknowledged as debts pending outcome of appeals / rectification -

¦ Income Tax Liability Rs. 7.83 Lakhs (P.Y. Rs. 1234.28 Lakhs)

¦ GST Liability Rs. NIL (P.Y. Rs. 101.79 Lakhs)

c) The company has filed legal suit against debtors towards recovery of Rs. 4.28 Lakhs and the provision for impairment / doubtful debts has been made for the same. The final realization is subject to outcome of the legal case.

NOTE 36-A:

Capital Commitments:-Estimate amount of contract remaining to be executed on Capital Account & not provided for Rs 9.56 Lakhs (P.Y. Rs 45.79 Lakhs) against which advance has been paid of Rs. 5.30 Lakhs (P.Y. Rs. 12.29 Lakhs)

The Company is planning for expansion of production facility in newly acquired Plant. Estimated project cost are Rs. 18 Crores out of which Rs. 16.83 crores has been already incurred till F.Y. 2023-24.

NOTE 37: Balance Confirmation

The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2024 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

In the opinion of the management, no item of current assets, loans and advances has a value on realization in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

b) Defined benefit plans - Gratuity & Leave Encashment:

Gratuity: - The Company operates a gratuity plan which is administrated through HDFC Standard Life Insurance Company Limited and a trust which is administrated through trustees. Every employee is entitled to a minimum benefit equivalent to 15 days salary last drawn for each completed year of service in line with Payment of Gratuity act, 1972. The same is payable at the time of separation from the company or retirement, whichever is earlier or death in service.

Leave Encashment: - The employees are entitled to accumulate compensated absence upto specified days as per company policy, which is payable at the time of separation from company i.e. retirement or death in service at the rate of last drawn salary.

The details on Company’s Gratuity and Leave Encashment liabilities employees are given below which is certified by the actuary and relied upon by the auditors.

A) Segment Reporting:

I n the opinion of the management the company is mainly engaged in the business of manufacturing of Elastic and all other activities of the Company including supply of raw materials to subsidiary of Rs. 696.22 Lakhs ( P.Y. Rs. 648.00 Lakhs) revolve around the main business, and as such, there are no separate reportable segments.

Adoption of Ind AS 116 - Leases

(a) Effective 1st April 2019, the Company has adopted Ind AS 116 - Leases using a modified retrospective approach. Accordingly, on initial application of Ind AS 116, in respect of leases previously classified as operating leases, lease liability is measured at the present value of remaining lease payments discounted using the incremental borrowing rate at the date of initial application and the Right-of-use asset has been measured at the amount equal to lease liability, adjusted for any prepaid or accrued lease payments recognised in the balance sheet immediately before the date of initial application.

F. (a) Company applied the exemption not to recognize right-of-use assets and liabilities for leases with less than 12 months of lease term and low value asset.

(b) Lease contracts entered by the Company pertains to staff houses, warehouses and offices taken on lease to conduct its business in the ordinary course. The Company does not have any lease restrictions and commitment towards variable rent as per the contract.

NOTE 45 : Corporate Social Responsibility (CSR) Activities

Premco’s CSR initiatives and activities are aligned to the requirements of Section 135 of the Companies Act 2013. The primary focus areas are Child education, Sports and Health care. The Company invests in basic health care, education and social welfare activities to support the basic needs of communities.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity and derivative instruments that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period.

Level 2: 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. The Company has mutual funds for which all significant inputs required to fair value an instrument falls under 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 and unlisted preference shares are included in level 3.

There are no transfers between levels 1, 2 and 3 during the year.

(ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

Investments in quoted equity instruments are valued using the closing price at Bombay Stock Exchange (BSE) at the reporting period.

The fair value of forward foreign exchange contracts is determined using forward exchange rates as at the balance sheet date, prevailing with authorised dealers dealing in foreign exchange.

The use of Net Assets Value (‘NAV) for valuation of mutual fund investment. NAV represents the price at which the issuer will issue further units and will redeem such units of mutual fund to and from the investors.

The fair value of the debentures is determined based on present values and the discount rates used were adjusted for counterparty risk and country risk.

a) The carrying amounts of trade receivables, trade payables, cash and cash equivalents, bank balances other than cash and cash equivalents, borrowings and other financial liabilities are considered to be the same as their fair values, due to their short term nature.

b) The fair values and carrying value for equity investments, security deposits, loans, other financial assets and other financial liabilities are materially the same.

NOTE 47A: Financial risk management

The Company’s activities expose it to market risk, liquidity risk and credit risk. In order to minimize any adverse effects on the financial performance of the company, derivative financial instruments, such as foreign exchange forward contracts are entered to hedge certain foreign currency risk exposures. Derivatives are used exclusively for hedging purposes and not as trading or speculative instruments.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of hedge accounting in the financial statements.

The company has a robust risk management framework comprising risk governance structure and defend risk management processes. The risk governance structure of the company is a formal organization structure with defend roles and responsibilities for risk management.

The Company risk management is carried out by a central treasury department under the guidance from the board of directors. Company’s treasury identifies, evaluates and hedges financial risks in close coordination with the company’s operating units. The board provides written principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity. There is no change in objectives and process for managing the risk and methods used to measure the risk as compared to previous year.

1) Credit Risk :

Credit risk is the risk that the counterparty will not meet its obligation under a financial instrument or customer contract, leading to financial loss. The Credit risk mainly arises receivables from customers, cash and cash equivalents, loans and deposits with banks, financial institutions & others.

a) Trade receivables and loans

The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs. 782.91 Lakhs as at March 31,2024 (March 31,2023- Rs. 1067.19 Lakhs) and from loans amounting Rs. 8.23 Lakhs (March 31, 2023- Rs. 12.79 Lakhs) Trade receivables are typically unsecured and are derived from revenue earned from customers located in India as well as outside India.

The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade receivables.

The Company‘s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry, the country and the state in which the customer operates, also has an influence on credit risk assessment.

Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business.

The management continuously monitors the credit exposure towards the customers outstanding at the end of each reporting period to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macroeconomic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

The average credit period on sales of products is less than 90 days. Credit risk arising from trade receivables is managed in accordance with the Company‘s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on a detailed study of credit worthiness and accordingly individual credit limits are defined/modified. For trade receivables, as a practical expedient, the Company computes credit loss allowance based on a provision table as above.

b) Cash and cash equivalents:

As at the year end, the Company held cash and cash equivalents of Rs. 485.08 Lakhs (March 31,2023: Rs. 602.01 Lakhs). The cash and cash equivalents are held with bank and financial institution counterparties with good credit rating.

c) Other Bank Balances:

Other bank balances are held with bank and financial institution counterparties with good credit rating.

d) Loans : The maximum exposure from loans is from loans due to employees and the repayments are regular and neither past due nor impaired.

e) Other financial assets:

Other financial assets includes security deposits which are neither past due nor impaired.

2) Liquidity Risk :

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses.

Company treasury maintains flexibility in funding by maintaining 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.

(i) Financing arrangements

The Company had access to the following undrawn borrowing facilities at the end of the reporting period:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risks namely interest rate risk, currency risk and other price risk, such as commodity risk. The Company is not exposed to interest rate risk whereas the exposure to currency risk and other price risk is given below:

A) Market Risk- Foreign currency risk.

The Company operates internationally and portion of the business is transacted in several currencies and consequently the Company is exposed to foreign exchange risk through its sales in overseas and purchases from overseas suppliers in various foreign currencies. Foreign currency exchange rate exposure is partly balanced by maintaining an EEFC bank account and purchasing of goods, commodities and services in the respective currencies. The Company also uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments, highly probable forecast transactions and foreign currency required at the settlement date of certain receivables/payables. The use of foreign currency forward contracts is governed by the Company‘s strategy approved by the board of directors, which provide principles on the use of such forward contracts consistent with the Company‘s risk management policy and procedures.

(a) Exposure

The company is mainly exposed to the price risk due to its investment in mutual funds and investment in equity instruments held by the company and classified in the balance sheet as fair value through profit or loss. The investment in mutual funds are mix of equity and debt based mutual funds. The price risk arises due to uncertainties about the future market values of these investments. To manage its price risk arising from investments in equity securities and mutual funds, the company diversifies its portfolio.

(b) Sensitivity

The table below summarizes the impact of increases/decreases of the BSE index on the Company‘s equity and Gain/ Loss for the period. The analysis is based on the assumption that the index has increased by 5% or decreased by 5% with all other variables held constant, and that all the company‘s equity instruments / mutual funds moved in line with the index.

NOTE 47B: Capital management (a) Risk Management

The company‘s objectives when managing capital are to safeguard the company‘s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to 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.

Additional Regulatory information.

NOTE 49 :

The disclosure requirements about any transactions not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act 1961 ( such as search or surveyor any other relevant provision of Income Tax Act 1961 ) is not applicable to the company.

NOTE 50 :

The company has not traded or invested in crypto currency or virtual currency during the financial year.

NOTE 51 :

There are no proceedings which are initiated or pending against the Company for holding any Benami property under the Benami transactions (Prohibition) Act 1988 & rules made thereunder.

NOTE 52 :

The Company does not have any transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of the Companies Act, 1956.

Note 53 :

Utilisation of Borrowed funds and share premium

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

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

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

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

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

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

Note 54 :

No significant subsequent events have been observed which may require an adjustment to the financial statements.

Note 55 :

The Company has used accounting software for maintaining its books of accounts which has a feature of recording audit trail (edit log) facility and the same has been operated throughout the year for all relevant transactions recorded in the software. Further, there are no instance of audit trail feature being tampered during the year.

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Mar 31, 2023

10. Provision & Contingent Liabilities Provision

provision are recognized when there is a present obligation as a result of a past event and it is probable that an outflow of benefits will be required to settle the obligation and there is a reliable estimate of the amount of the obligation.

Contingent liabilities

Contingent liabilities are disclosed when there is a possible obligation arising from the past events, the existence of which will be confirmed only on 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 portable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

11. Income Tax, Deferred Tax

a) Current and Deferred Tax

Tax expense for the period, comprising Current tax and Deferred Tax are included in the determination of net profit or loss for the period.

Current tax is measured at the amount expected to be paid to the tax authorities in accordance with the taxation laws prevailing in India.

Deferred Tax is recognized for all the timing differences, subject to the consideration of prudence in respect of deferred tax assets. Deferred tax assets are recognized and carried forward only to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

Deferred Tax assets and liabilities are measured using the tax rates and tax laws that have been enacted and substantively enacted by the Balance Sheet date. At each Balance Sheet date, the company re-assesses unrecognized deferred tax assets, if any.

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

Current and deferred tax is recognized in the statement of profit and loss, except to the extent that it relates to items recognized in other comprehensive income or directly in equity.

12. Borrowing Cost

Borrowing cost incurred in relation to the acquisition, construction of assets are capitalized as the part of cost of such assets up to date which such assets are ready for intended use. Other borrowing costs are charged as an expense over the period of Term Loan.

13. Impairment of Assets

Assessment is done at each Balance Sheet date as to whether there is any indication that a tangible asset may be impaired. For the purpose of assessing impairment, the smallest identifiable group of asset that generates cash inflows from continuing use that are largely independent of the cash inflow from other assets or groups of assets, is considered as a cash generating unit. If any such indication exists, an estimate of the recoverable amount of the asset/cash generating unit is made.

Assets whose carrying value exceeds their recoverable amount are written down to the recoverable amount. Recoverable

amount is higher of an asset’s or cash generating unit’s net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an assets and from its disposal at the end of its useful life. Assessment is also done at each Balance Sheet date as to whether there is any indication that an impairment loss recognized for an asset in prior accounting periods may no longer exist or may have decreased.

14. Leases (As a lessee)

The Company has adopted Ind AS 116 “Leases” using the modified retrospective approach with effect from initially applying this standard from 1st April 2019.

The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116 and this may require significant judgment. The Company also uses significant judgement in assessing the lease term (including anticipated renewals) and the applicable discount rate.

The Company determines the lease term as the non-cancellable period of a lease, together with both periods covered by an option to extend or terminate the lease if the Company is reasonably certain based on relevant facts and circumstances that the option to extend or terminate will be exercised. If there is a change in facts and circumstances, the expected lease term is revised accordingly.

The discount rate is generally based on the interest rate specific to the lease being evaluated or if that cannot be easily determined the incremental borrowing rate for similar term is used.

The Company has elected not to recognise right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The Company recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

The Company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and restoration cost, less any lease incentives received.

The right-of-use assets are subsequently depreciated over the shorter of the asset’s useful life and the lease term on a straightline basis.In addition, the right-of-use asset is reduced by impairment losses, if any.

The lease liability is initially measured at amortised cost at the present value of the future lease payments. When a lease liability is remeasured, the corresponding adjustment of the lease liability is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

15. Cash and Cash Equivalents:

In the Cash flow statement, cash and cash equivalents include cash on hand, demand deposits with bank, other short term highly liquid investments with original maturity of three months or less.

16. Earnings per share:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by weighted average number of equity shares outstanding during the period. The Weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for the events, such as bonus shares, other than conversion of potential equity share that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity share holders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

A financial instrument is a contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

1) Financial Assets

i) Classification

The Company classifies its financial assets in the following measurement categories:

a) at fair value either through other comprehensive income (FVOCI) or through profit and loss (FVTPL); and

b) at amortised cost.

The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash lows.

Gains and losses will either be recorded in the statement of profit and loss or other comprehensive income for assets measured at fair value.

For investments in debt instruments, this will depend on the business model in which the investment is held.

For investments in equity instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value or through other comprehensive income.

The Company reclassifies debt investments when and only when its business model for managing those assets changes.

ii) Measurement

At initial recognition, in case of a financial asset not at fair value through the statement of profit and loss account, the Company measures a financial asset at its fair value plus transaction costs that are directly attributable to the acquisition of the financial asset. However trade receivables that do not contain a significant financing component are measured at transaction price. Transaction costs of financial assets carried at fair value through the statement of profit and loss are expensed in profit or loss.

a) Debt instruments

There are three measurement categories into which the Company classifies its debt instruments:

Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. Gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in the statement of profit and loss when the asset is derecognised or impaired. Interest income from these financial assets is included in other income using the effective interest rate method.

Fair value through other comprehensive income (FVOCI): Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets‘ cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income (FVOCI). Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognised in profit and loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to the statement of profit and loss and recognised in other income or other expenses (as applicable). Income from these financial assets is included in other income.

Fair value through proit and loss (FVTPL) : Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through the profit and loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit and loss and is not part of a hedging relationship is recognised in the statement of profit and loss and within other income or other expenses (as applicable) in the period in which it arises. Income from these financial assets being difference of cost & maturity proceeds are included in other income or other expenses, as applicable.

The Company measures all equity investments (except Equity investment in subsidiaries and joint ventures) at fair value. The Company‘s management has opted to present fair value gains and losses on equity investments through profit and loss account. Dividends from such investments are recognised in the statement of profit and loss as other income when the Company‘s right to receive payments is established.

Changes in the fair value of financial assets at fair value through profit and loss are recognised in other income or other expenses, as applicable in the statement of profit and loss.

iii) Impairment of financial assets

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade receivables only, the company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

iv) Derecognition of financial assets

A financial asset is derecognised only when -

a) The Company has transferred the rights to receive cash flows from the financial asset or

b) Retains the contractual rights to receive the cash lows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

Where the company has transferred an asset, it evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is derecognised. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognized.

Where the company has neither transferred a financial asset nor retains substantially all risks and rewards of ownership of the financial asset, the financial asset is derecognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.

v) Income Recognition Interest income

Interest income from debt instruments is recognised using the effective interest rate method. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of a financial asset. When calculating the effective interest rate, the company estimates the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment, extension, call and similar options) but does not consider the expected credit losses.

Dividend income

Dividends are recognised in the statement of profit and loss only when the right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the Company, and the amount of the dividend can be measured reliably.

vi) Cash and cash equivalents

Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other short- term, highly liquid investments with original maturities of three months or less, that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

vii) Trade Receivables

Trade receivables are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest rate method, less provision for impairment.

i) Measurement

Financial liabilities are initially recognised at fair value, reduced by transaction costs (in case of financial liabilities not recorded at fair value through profit and loss), that are directly attributable to the issue of financial liability. All financial liabilities are subsequently measured at amortised cost using effective interest method. Under the effective interest method, future cash outflow are exactly discounted to the initial recognition value using the effective interest rate, over the expected life of the financial liability, or, where appropriate, a shorter period. At the time of initial recognition, there is no financial liability irrevocably designated as measured at fair value through profit and loss.

ii) Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the de-recognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit and loss.

iii) Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid as per payment terms.

iv) Derivatives and hedging activities

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured to their fair value at the end of each reporting period. Resulting gains/(losses) are recorded in statement of profit and loss under other income/other expenses. Derivatives are classified as a current asset or liability when expected to be realised/settled within 12 months of the balance sheet date.

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the balance sheet where there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Company or the counterparty.

NOTE : 3A Critical estimates and judgments

In the application of the company‘s accounting policies, which are described in note 2, the management is required to make judgment, estimates, and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other process. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future period if the revision affects both current and future period.

The following are the critical estimates and judgments that have the significant effect on the amounts recognised in the financial statements.

Critical estimates and judgments

i) Estimation of current tax expense and deferred tax

The calculation of the company‘s tax charge necessarily involves a degree of estimation and judgment in respect of certain items whose tax treatment cannot be finally determined until resolution has been reached with the relevant tax authority or, as appropriate, through a formal legal process. Significant judgments are involved in determining the provision for income taxes, including amount expected to be paid/recovered for uncertain tax positions. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the current and deferred income tax in the period in which such determination is made.

The recognition of deferred tax assets is based upon whether it is probable that sufficient and suitable taxable profits will be available in the future against which the reversal of temporary differences can be deducted. To determine the future taxable profits, reference is made to the approved budgets of the company. Where the temporary differences are related to losses, local tax law is considered to determine the availability of the losses to offset against the future taxable profits as well as whether there is convincing evidence that sufficient taxable profit will be available against which the unused tax losses or unused tax credits can be utilised by the company. Significant items on which the Company has exercised accounting judgment include recognition of deferred tax assets in respect of losses. The amounts recognised in the financial statements in respect of each matter are derived from the Company‘s best estimation and judgment as described above.

ii) Estimation of Provisions and Contingent Liabilities

The company exercises judgment in measuring and recognising provisions and the exposures to contingent liabilities, which is related to pending litigation or other outstanding claims. Judgment is necessary in assessing the likelihood that a pending claim will succeed, or a liability will arise, and to quantify the possible range of the financial settlement.

Because of the inherent uncertainty in this evaluation process, actual liability may be different from the originally estimated as provision. Although there can be no assurance of the final outcome of the legal proceedings in which the company is involved, it is not expected that such contingencies will have a material effect on its financial position or profitability.

iii) Estimation of useful life of Property, Plant and Equipment, Intangible assets, Investment properties

Property, Plant and Equipment, Intangible assets, Investment properties represent a significant proportion of the asset base of the company. The charge in respect of periodic depreciation is derived after determining an estimate of an asset‘s expected useful life and the expected residual value at the end of its life. The useful lives and residual values of company‘s assets are determined by management at the time the asset is acquired and reviewed periodically, including at each financial year end. The useful lives are based on historical experience with similar assets as well as anticipation of future events, which may impact their life, such as changes in technology.

iv) Estimation of provision for inventory

The company writes down inventories to net realisable value based on an estimate of the realisability of inventories. Write downs on inventories are recorded where events or changes in circumstances indicate that the balances may not realised. The identification of write-downs requires the use of estimates of net selling prices of the down-graded inventories. Where the expectation is different from the original estimate, such difference will impact the carrying value of inventories and write-downs of inventories in the periods in which such estimate has been changed.

v) Estimation of defined benefit obligation

The present value of the defined benefit obligations depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost (income) for post employments plans include the discount rate. Any changes in these assumptions will impact the carrying amount of such obligations.

The company determines the appropriate discount rate at the end of each year. This is the interest rate that should be used to determine the present value of estimated future cash outflows expected to be required to settle the defined benefit obligations. In determining the appropriate discount rate, the company considers the interest rates of government bonds of maturity approximating the terms of the related plan liability.

vi) Estimated fair value of Financial Instruments

The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. The Management uses its judgment to select a variety of methods and make assumptions that are mainly based on market conditions existing at the end of each reporting period.

vii) Impairment of Trade Receivable

The impairment provisions for trade receivable are based on assumptions about risk of default and expected loss rates. The company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the company’s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

The Company risk management is carried out by a central treasury department under the guidance from the board of directors. Company''s treasury identifies, evaluates and hedges financial risks in close coordination with the company''s operating units. The board provides written principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity. There is no change in objectives and process for managing the risk and methods used to measure the risk as compared to previous year.

1) Credit Risk :

Credit risk is the risk that the counterparty will not meet its obligation under a financial instrument or customer contract, leading to financial loss. The Credit risk mainly arises receivables from customers, cash and cash equivalents, loans and deposits with banks, financial institutions & others.

a) Trade receivables

The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs. 1067.19 Lakhs as at March 31,2023 (March 31,2022- Rs. 1,569.15 Lakhs) and from loans amounting Rs. 12.79 Lakhs (March 31, 2022- Rs. 17.06 Lakhs) Trade receivables are typically unsecured and are derived from revenue earned from customers located in India as well as outside India.

The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade receivables.

The Company‘s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry, the country and the state in which the customer operates, also has an influence on credit risk assessment.

Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business.

The management continuously monitors the credit exposure towards the customers outstanding at the end of each reporting period to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macroeconomic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

The movement in the allowance for impairment in respect of trade receivables during the year was as follow:

FOR S. P. Jain & Associates FOR AND ON BEHALF OF THE BOARD

Chartered Accountants

FRN 103969W Sd/- Sd/-

ASHOK B. HARJANI NISHA P. HARJANI

Sd/- CHAIRMAN & MANAGING DIRECTOR DIRECTOR & CFO

DIN - 00725890 DIN - 00736566

Kapil K. Jain PARTNER

Membership No.108521 PLACE: MUMBAI

UDIN - 23108521BGVRFT8486 DATED: 18th MAY, 2023

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Mar 31, 2018

NOTES:

1. The Company has applied the optional exemption to measure its property, plant and equipment at the date of transition at their fair values and used it as the deemed cost for such assets at the date of transition. The details are in Note 48 (A.1.1)

2. Subsidy on fixed assets gross of Rs. 9.62 Lakhs & Accumulated depreciation of Rs. 2.36 Lakhs reduced in FY 2016-17 under GAAP is now added back as per IND AS & Rs. 9.62 Lakhs- reflected as deferred income in other liability.

3. Refer Note 35 for disclosure of contractual commitments for the acquisition of preperty, plant and equipment.

The Long Term Portion of Term Loans are shown under long term Borrowings and the current maturities of long term borrowings are shown under the current liabilities in Note 18B.

17.2 DETAILS OF SECURITY AND TERMS OF REPAYMENT

(a) HDFC BANK - Term Loans referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra along with personal guarantee of Lokesh Harjani.

Working capital referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra along with personal guarantee of Lokesh Harjani.

NOTE 34: Contingent Liabilities :-

a) Unredeemed Bank Guarantees & Letter of credit are Rs. 210.74 Lakhs (P.Y. Rs. 222.62 Lakhs)

b) Claims against the company not acknowledged as debts

¦ Income Tax Liability Rs. 4.94 Lakhs ( P.Y. 6.53 Lakhs )

c) The company has imported machineries under EPCG license whereby the custom duty saved of Rs. 52.72 Lakhs ( P.Y. 52.72 Lakhs ) is subject to performance of pre stated obligations. The non-performance would result in liability towards custom duty saved along with penalty and damages.

NOTE 35:

Capital Commitments :-

Estimate amount of contract remaining to be executed on Capital Account & not provided for Rs Nil ( Rs. Nil ) against which advance has been paid of Rs. Nil ( P.Y. Nil )

NOTE 36:

The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2018 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

In the opinion of the management, no item of current assets, loans and advances has a value on realization in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

b) Defined benefit plans - Gratuity & Leave Encashment :

Gratuity :- The company operates a gratuity plan which is administrated through HDFC Standard Life Insurance Company Limited and a trust which is administrated through trustees. Every employee is entitled to a minimum benefit equivalent to 15 days salary last drawn for each completed year of service in line with Payment of Gratuity act, 1972. The same is payable at the time of separation from the company or retirement, whichever is earlier or death in service.

Leave Encashment :- The employees are entitled to accumulate compensated absence up to specified days as per company policy, which is payable at the time of separation from company i.e. retirement or death in service at the rate of last drawn salary.

The details on Company’s Gratuity and Leave Encashment liabilities employees are given below which is certified by the actuary and relied upon by the auditors.

NOTE 40 :

A) Segment Reporting :

In the opinion of the management the company is mainly engaged in the business of manufacturing of Elastic and all other activities of the Company including supply of raw materials to subsidiary of Rs. 739.46 Lakhs ( P.Y. Rs. 218.11 Lakhs ) revolve around the main business, and as such, there are no separate reportable segments.

NOTE 41:

Related Party Disclosures

A) List of Related Parties and Relationship

a) Subsidiaries : -

Premco Global Vietnam Co. Ltd._Subsidiary_

b) Associates : -

Premco Industries Enterprise on which significant influence is exercised having common Onspot Solutions Pvt. Ltd. directors/partners. Pixel Packaging Ltd.__

c) Key Management Personnel : -

Mr. Ashok B. Harjani Chairman & Managing Director

Mr. Lokesh P. Harjani Director

Mrs. Nisha P. Harjani Director

Mrs. Sonia A. Harjani Director

Mr. Devendra Kumar Jain CEO - Projects

Mr. Shantanu Dey__CEO_

NOTE 42:

Leases :

As a Leasee:

The Company’s major leasing arrangements are in respect of commercial /residential premises (including furniture and fittings therein wherever applicable taken on leave and license basis). These leasing arrangements which are cancellable, range 11 months to 5 years, or longer and are usually renewable by mutually agreed terms and conditions.

NOTE 44 : Corporate Social Responsibility (CSR) Activities :-

During the year, the Company is required to spend an amount of Rs. 35.47 Lakhs (PY Rs. 33.72 Lakhs) towards CSR activities, whereas the Company has already spent Rs. 35.32 Lakhs (PY Rs. 33.74 Lakhs) towards Corporate Social Responsibility ( CSR) under section 135 of the Companies Act, 2013 and rules thereon by way of contribution to various Trusts / NGOs / Societies / Agencies.

NOTE 45: DISCLOSURE ON SPECIFIED BANK NOTES (SBNs) :-

i The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2018.

ii Following are the details of holdings as well as dealings in Specified Bank Notes for the previous year ended March 31, 2017.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period.

Level 2: 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. The Company has mutual funds for which all significant inputs required to fair value an instrument falls under 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 and unlisted preference shares are included in level 3.

There are no transfers between levels 1, 2 and 3 during the year.

(ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

Investments in quoted equity instruments are valued using the closing price at Bombay Stock Exchange (BSE) at the reporting period.

The fair value of forward foreign exchange contracts is determined using forward exchange rates as at the balance sheet date, prevailing with Authorised Dealers dealing in foreign exchange.

The use of Net Assets Value (‘NAV) for valuation of mutual fund investment. NAV represents the price at which the issuer will issue further units and will redeem such units of mutual fund to and from the investors.

The fair value of the debentures is determined based on present values and the discount rates used were adjusted for counterparty risk and country risk.

a) The carrying amounts of trade receivables, trade payables, cash and cash equivalents, bank balances other than cash and cash equivalents, borrowings and other financial liabilities are considered to be the same as their fair values, due to their short term nature.

(b) The fair values and carrying value for equity investments, security deposits, loans, other financial assets and other financial liabilities are materially the same.

NOTE 47A: Financial risk management

The Company’s activities expose it to market risk, liquidity risk and credit risk. In order to minimize any adverse effects on the financial performance of the company, derivative financial instruments, such as foreign exchange forward contracts are entered to hedge certain foreign currency risk exposures. Derivatives are used exclusively for hedging purposes and not as trading or speculative instruments.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of hedge accounting in the financial statements.

The company has a robust risk management framework comprising risk governance structure and defend risk management processes. The risk governance structure of the company is a formal organization structure with defend roles and responsibilities for risk management.

The Company risk management is carried out by a central treasury department under the guidance from the board of directors. Company’s treasury identifies, evaluates and hedges financial risks in close coordination with the company’s operating units. The board provides written principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity. There is no change in objectives and process for managing the risk and methods used to measure the risk as compared to previous year.

1) Credit Risk :

Credit risk is the risk that the counterparty will not meet its obligation under a financial instrument or customer contract, leading to financial loss. The Credit risk mainly arises receivables from customers, cash and cash equivalents, loans and deposits with banks, financial institutions & others.

a) Trade receivables

The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs. 1328.14 Lakhs as at March 31, 2018 (March 31, 2017- Rs.1257.54 Lakhs; April 1, 2016 - Rs.954.25 Lakhs) and from loans amounting Rs. 1185.35 Lakhs (March 31, 2017- Rs.944.36 Lakhs; April 1, 2016 - Rs.120.30 Lakhs) Trade receivables are typically unsecured and are derived from revenue earned from customers located in India as well as outside India. The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade receivables.

The Company‘s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry, the country and the state in which the customer operates, also has an influence on credit risk assessment.

Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business.

The management continuously monitors the credit exposure towards the customers outstanding at the end of each reporting period to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macroeconomic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

The movement in the allowance for impairment in respect of trade receivables during the year was as follow:

The average credit period on sales of products is less than 90 days. Credit risk arising from trade receivables is managed in accordance with the Company‘s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on a detailed study of credit worthiness and accordingly individual credit limits are defined/modified. For trade receivables, as a practical expedient, the Company computes credit loss allowance based on a provision table as above.

b) Cash and cash equivalents:

As at the year end, the Company held cash and cash equivalents of Rs. 22.51 Lakhs (March 31, 2017: Rs.198.41 Lakhs and April 1, 2016: Rs. 198.78 Lakhs). The cash and cash equivalents are held with bank and financial institution counterparties with good credit rating.

c) Other Bank Balances:

Other bank balances are held with bank and financial institution counterparties with good credit rating.

d) Loans : The maximum exposure from loans is from loans due to subsidiary company and the repayments Are regular and neither past due nor impaired.

e) Other financial assets:

Other financial assets includes security deposits which are neither past due nor impaired.

2) Liquidity Risk :

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses.

Company treasury maintains flexibility in funding by maintaining 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.

(i) Financing arrangements

The Company had access to the following undrawn borrowing facilities at the end of the reporting period:

Other financial liabilities includes Current maturity of long-term borrowings of Rs. 85.78 Lakhs ( March 31, 2017 : 77.23 Lakhs and April 1, 2016 : 36.30 Lakhs) is included in borrowings above :

3) Market Risk :

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risks namely interest rate risk, currency risk and other price risk, such as commodity risk. The Company is not exposed to interest rate risk whereas the exposure to currency risk and other price risk is given below:

A) Market Risk- Foreign currency risk.

The Company operates internationally and portion of the business is transacted in several currencies and consequently the Company is exposed to foreign exchange risk through its sales in overseas and purchases from overseas suppliers in various foreign currencies. Foreign currency exchange rate exposure is partly balanced by maintaining an EEFC bank account and purchasing of goods, commodities and services in the respective currencies. The Company also uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments, highly probable forecast transactions and foreign currency required at the settlement date of certain receivables/payables. The use of foreign currency forward contracts is governed by the Company‘s strategy approved by the board of directors, which provide principles on the use of such forward contracts consistent with the Company‘s risk management policy and procedures.

B) Market Risk- Price risk.

(a) Exposure

The company is mainly exposed to the price risk due to its investment in mutual funds and investment in equity instruments held by the company and classified in the balance sheet as fair value through profit or loss. The investment in mutual funds are mix of equity and debt based mutual funds. The price risk arises due to uncertainties about the future market values of these investments. To manage its price risk arising from investments in equity securities and mutual funds, the company diversifies its portfolio.

(b) Sensitivity

The table below summarizes the impact of increases/decreases of the BSE index on the Company‘s equity and Gain/ Loss for the period. The analysis is based on the assumption that the index has increased by 5% or decreased by 5% with all other variables held constant, and that all the company‘s equity instruments moved in line with the index.

NOTE 47B: Capital management (a) Risk Management

The company‘s objectives when managing capital are to safeguard the company‘s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to 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.

The Company monitors capital on the basis of the following gearing ratio:

NOTE 48: First Time Adoption of Ind AS Transition to Ind AS

These are the Company‘s first standalone financial statements prepared in accordance with Ind AS. The accounting policies set out in note 2 have been applied in preparing the financial statements for the year ended March 31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of an opening Ind AS balance sheet at April 1, 2016 (the company‘s date of transition). In preparing its opening Ind AS balance sheet, the company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2014 and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the company‘s financial position, financial performance and cash flows is set out in the following tables and notes.

A. Exemptions and exceptions availed

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

A.1 Ind AS optional exemptions

A.1.1 Deemed cost for Property, Plant and Equipment, Intangible Assets and Investment Property.

Ind AS 101 permits a first time adopter to opt to continue with the carrying value for all of its property, plant and equipment as recognized 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 if any. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets.

Accordingly, the company has opted to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value and use the same as deemed cost in the opening Ind AS balance sheet.

A.1.2 Designation of previously recognized financial instrument

Ind AS 101 allows an entity to recognize investments in equity instruments at fair value through profit and loss (FVTPL) through an irrevocable election on the basis of the facts and circumstances at the date of transition to Ind AS. The company has opted to apply this exemption for its investment in quoted equity investments, debentures and mutual funds.

A.1.3 Investment in subsidiary

The Company has opted to measure its equity investment in subsidiary at its previous GAAP carrying values which shall be the deemed cost as at the date of transition to Ind AS.

A.2 Ind AS mandatory exceptions

A.2.1 Estimates

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

Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP

- Investment in equity instruments carried at FVTPL

- Investment in debt instruments carried at FVTPL

- Impairment of financial assets based on expected credit loss model

Upon an assessment of the estimates made under Previous GAAP, the Company has concluded that there was no necessity to revise such estimates under Ind AS, except where estimates were required by Ind AS and not required by previous GAAP.

A.2.2 Classification and measurement of financial assets

a) 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.

b) Reconciliation 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 tables represent the reconciliation from previous GAAP to Ind AS.

Note 1: Fair valuation of investments

Under previous GAAP, Investments were accounted at cost. Under IND AS, the company has valued investments at fair value through statement of profit and loss. Impact of fair value changes on the date of transition including tax impact thereon is recognized in other equity (opening reserves) as at 1st April, 2016. Changes in fair value thereafter are recognized in statement of profit and loss and impact of actual realized gain as per previous GAAP is reversed.

Note 2: Government grants relating to Property, Plant & Equipment & other revenue grants

Under the previous GAAP, the government grants towards reimbursement of cost of fixed assets were reduced from the cost of fixed assets. Under IND AS the Company has increased the cost of fixed assets and recognized income from government grants over the useful life of the assets. Further the depreciation is also charged as per the remaining useful life.

The government grants other than fixed assets are recognized as income in the year of receipt.

Note 3: Financial instruments - derivatives

Under the previous GAAP, the foreign currency exchange rate fluctuation on forward contract hedges as on the closing dates were booked in the statement of profit & loss account. Under IND AS the same are recognized through other comprehensive income.

Note 4: Remeasurements of post-employment benefit obligations

Under the IND AS, remeasurement i.e. actuarial gain/loss and the return on plan assets, excluding amounts included in the net interest expenses on the net defined benefit liability are recognized in other comprehensive income instead of statement of profit and loss. Under the previous GAAP, these remeasurement were part of profit and loss for the year.

Note 5: Effective Interest on borrowing

Under the IND AS, the interest on long term borrowings are recognized at effective rate recognizing the initial borrowing expenditure incurred. Under the previous GAAP, the interest was accounted at actual rate.

NOTE 6 : Figures of Previous are regrouped and reclassified wherever necessary. As per our Annexed Report of even date For & On Behalf of The Board

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Mar 31, 2017

1.1 The items for reconciliation of the number of shares outstanding at the beginning and at the end of the reporting period is as follows.

1.2 Terms/Rights Attached to Shares

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

1.3 Details of Share holders holding more than 5 % of Shares

1.4 There are no Bonus Shares /Buyback/Shares for consideration other than cash issued during past five years

2.1 The Long Term Portion of Term Loans are shown under long term Borrowings and the current maturities of long term borrowings are shown under the current liabilities in Note 10(a) as per the disclosure requirements of the Schedule III of the Companies Act, 2013.

2.2 DETAILS OF SECURITY AND TERMS OF REPAYMENT

(a) HDFC BANK - Term Loans referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra along with personal guarantee of Lokesh P. Harjani.

(b) HDFC BANK LTD

Vehicle Loan from Bank are secured by mortgage of Respective Vehicle. The details of Loan is as under

(c) KOTAK MAHINDRA PRIME LTD.

Vehicle Loan from Bank are secured by mortgage of Respective Vehicle. There are different Loans and their respective details are as under

3.1 The Long Term Portion of Security Deposit Employees are shown under Other Long term Liabilities and the current maturities of Security Deposit Employees are shown under the current liabilities in Note 10(e)(i) as per the disclosure requirements of the Schedule III of the Companies Act, 2013.

4.1 The Long Term Portion of Provision for Employee Benefits are shown under Long Term Provisions and the current portion of Provision for Employee Benefits are shown under the Short term Provisions in Note 11(a) as per the disclosure requirements of the Schedule III of the Companies Act, 2013.

Working capital referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra along with personal guarantee of Lokesh P. Harjani.

*5.1 The Company has received intimation from suppliers regarding their status under Micro, Small and Medium Enterprises Development Act, 2006 and hence the following disclosures are given wrt. the extent of information as available with the company

Note 6.1 The board of Directors has recomonded a final dividend @ Rs. 3/- per equity share of Rs. 10/- each on 33,04,800 equity shares for the year ended 31.03.2017. ( P.Y. Rs. 0.50/- per equity share of Rs. 10/- each on 33,04,800 equity shares ) in addition to Interim Dividend paid @ Rs. NIL per equity share of Rs. 10/- each ( P.Y. Rs. 2.50/- per equity shares ) of Rs. 10/- each.

7.1 The Long Term Portion of Loans and Advances given to staff are shown under Long term Loans and Advances and the current portion of Loans and Advances given to staff are shown under the Short term Loans and Advances in Note 19 as per the disclosure requirements of the Schedule III.

NOTE 8: Contingent Liabilities :-

a) Unredeemed Bank Guarantees & Letter of credit are Rs. 222.62 Lakhs (P.Y. Rs. 21.48 Lakhs )

b) Claims against the company not acknowledged as debts

- Income Tax Liability Rs. 6.53 Lakhs ( P.Y. 11.49 Lakhs )

c) The company has imported machineries under EPCG license whereby the custom duty saved of Rs. 52.72 Lakhs ( P.Y. 32.38 Lakhs ) is subject to performance of pre stated obligations. The non-performance would result in liability towards custom duty saved along with penalty and damages.

NOTE 9:

Capital Commitments :-

Estimate amount of contract remaining to be executed on Capital Account & not provided for Rs Nil ( Rs. 308.72 Lakhs) against which advance has been paid of Rs. Nil ( P.Y. Nil )

NOTE 10:

The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2017 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

In the opinion of the management, no item of current assets, loans and advances has a value on realization in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

NOTE 11 : Unhedged Foreign Currency Exposure & Derivative Instruments :-

(A) Foreign Currency exposure that are not hedged by derivative instruments or otherwise are as follows:

(B) Forward Contracts for hedge of Trade Receivables and under firm commitments/high probable forecast transactions are as follows :

NOTE 12: Disclosures in accordance with Revised AS -15 on “Employee Benefits” :-

a) Defined contribution plans- The company has recognized the following amounts in the Statement of Profit & loss for the Year :

b) Defined benefit plans - Gratuity & Leave Encashment :

Gratuity :- The company operates a gratuity plan which is administrated through HDFC Standard Life Insurance Company Limited and a trust which is administrated through trustees. Every employee is entitled to a minimum benefit equivalent to 15 days salary last drawn for each completed year of service in line with Payment of Gratuity act, 1972. The same is payable at the time of separation from the company or retirement, whichever is earlier or death in service.

Leave Encashment :- The employees are entitled to accumulate compensated absence upto specified days as per company policy, which is payable at the time of separation from company i.e. retirement or death in service at the rate of last drawn salary.

The details on Company’s Gratuity and Leave Encashment liabilities employees are given below which is certified by the actuary and relied upon by the auditors.

NOTE 13 :

A) Segment Reporting :

In the opinion of the management the company is mainly engaged in the business of manufacturing of Elastic and all other activities of the Company revolve around the main business, and as such, there are no separate reportable segments.

B) Secondary Business Segment :

NOTE 14: Information (to the extent applicable) pursuant to AS 19 :

The Company’s significant leasing arrangements are in respect of operating leases for premises (Factory & office premises etc.). These leasing arrangements which are not non-cancellable range between 11 months and 5 years generally, or longer, and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent under Note 29.

NOTE 15: Earning Per Share:

Earning per share computed in accordance with Accounting Standard 20: ‘Earning Per Share’

NOTE 16 : Corporate Social Responsibility (CSR) Activities :-

During the year, the Company has spent Rs. 33.74 Lakhs (PY Rs. 21.82 Lakhs) towards Corporate Social Responsibility ( CSR ) under section 135 of the Companies Act, 2013 and rules thereon by way of contribution to various Trusts / NGOs / Societies / Agencies.

NOTE 17 : DISCLOSURE ON SPECIFIED BANK NOTES (SBNs) :-

During the year, the Company had specified bank notes (SBNs) and other denomination notes as defined in the MCA notification G.S.R. 308(E) dated 31st March, 2017, on the details of Specified Bank Notes (SBNs) held and transacted during the period from 8th November, 2016 to 30th December, 2016, the denomination wise SBNs and other notes as per the notification is given below:

NOTE 18 :Figures of Previous are regrouped and reclassified wherever necessary.

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Mar 31, 2016

1. Terms/Rights Attached to Shares

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

2. There are no Bonus Shares /Buyback/Shares for consideration other than cash issued during past five years

3. DETAILS OF SECURITY AND TERMS OF REPAYMENT

(a)HDFC BANK - Term Loans referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra along with personal guarantee of Lokesh Harjani.

4. The Company has not received any intimation from suppliers regarding their status under Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures regarding :

a) Amount due and Outstanding to suppliers as at the end of accounting year.

b) Interest paid during the year.

c) Interest due on amount find beyond due date during the year

d) Interest accrued and unpaid at the end of the accounting year, have not been given.

e) Total interest due but not paid including prior years.

*There is no amount due and outstanding as on 31st March 2016 to be credited to Investor Education and Protection Fund. The unpaid dividend for the financial year 2007-08 of Rs. 153912/- which has been paid to Investor Protection Reserve Fund on 31.10.2015.

Note 5. The board of Directors has recommended a final dividend @ Rs. 0.50/- per equity share of Rs. 10/- each on 33,04,800 equity shares for the year ended 31.03.2016. ( P.Y. Rs. 2.70/- per equity share of Rs. 10/- each on 32,61,000 equity shares ) in addition to Interim Dividend paid @ Rs. 2.50/- per equity share of Rs. 10/- each ( P.Y. NIL per equity shares ) of Rs. 10/- each.

b) Defined benefit plans - Gratuity & Leave Encashment :

Gratuity :- The company operates a gratuity plan which is administrated through HDFC Standard Life Insurance Company Limited and a trust which is administrated through trustees. Every employee is entitled to a minimum benefit equivalent to 15 days salary last drawn for each completed year of service in line with Payment of Gratuity act, 1972. The same is payable at the time of separation from the company or retirement, whichever is earlier or death in service.

Leave Encashment :- The employees are entitled to accumulate compensated absence up to specified days as per company policy, which is payable at the time of separation from company i.e. retirement or death in service at the rate of last drawn salary.

The details on Company''s Gratuity and Leave Encashment liabilities employees are given below which is certified by the actuary and relied upon by the auditors.

NOTE 6:

Information (to the extent applicable) pursuant to AS 19 :

The Company''s significant leasing arrangements are in respect of operating leases for premises (Factory & office premises etc.). These leasing arrangements which are not non-cancellable range between 11 months and 5 years generally, or longer, and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent under Note 29.

NOTE 7 : Corporate Social Responsibility (CSR) Activities :-

During the year, the Company has spent Rs. 21.82 Lacs (P.Y. Rs. 9.49 Lacs) towards Corporate Social Responsibility ( CSR ) under section 135 of the Companies Act, 2013 and rules thereon by way of contribution to various Trusts / NGOs / Societies / Agencies.

NOTE 8. : Figures of Previous are regrouped and reclassified wherever necessary.

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Mar 31, 2015

1. Terms/Rights Attached to Shares

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

a. The Long Term Portion of Term Loans are shown under long term Borrowings and the current maturities of Long term borrowings are shown under the current liabilities in Note 10(a) as per the disclosure requirements of the Schedule III of the Companies Act, 2013.

2. DETAILS OF SECURITY AND TERMS OF REPAYMENT

(a) HDFC BANK - Term Loans referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra along with personal guarantee of Lokesh Harjani.

3.a. The Long Term Portion of Provision for Employee Benefits are shown under Long Term Provisions and the current portion of Provision for Employee Benefits are shown under the Short term Provisions in Note 11 (a) as per the disclosure requirements of the Schedule III of the Companies Act, 2013.

b. The Company has entered into funding arrangement with HDFC Standard Life Insurance Company Limited and that the Gratuity payable to Employees is covered under the Employees Group Gratuity Scheme through the " Premco Global Limited Employees Gratuity Trust". Accordingly the gratuity liabilities provided in the books of the company as on 31.03.2015 of Rs. 56.91 Lacs ( P.Y. Rs. 55.91 Lacs) has been squared off against the company contribution of Rs. 65.00 Lacs towards planned assets and the amount of Rs. 8.28 Lacs is charged to Profit & Loss account as Gratuity Expense.

During the year, the Company has revised depreciation rate on certain fixed assets as per the useful life specified in the Companies Act, 2013.

Accordingly, the carrying amount as at 01.04.2014 is being depreciated over revised remaining useful life of the asset.

The Carrying value of Rs. 87.35 Lacs in case of Assets worth NIL revised remaining useful life as at 01.04.2014, is reduced aftertax adjustment of Rs. 29.69 Lacs from the Retained Earnings as at such date. Further, had the Company continued with the previously assessed useful lives, charge for depreciation for the year ended 31.03.2015 would have been lower by Rs. 121.56 Lacs and profit before tax would be higher by such amount.

4. Contingent Liabilities:

a) Unredeemed Bank Guarantees are Rs.24.22 Lacs (P.Y. Rs. 15.34 Lacs)

b) Claims against the company not acknowledged as debts

* Income Tax Liability Rs. 14.25 Lacs (PY. 6.13 Lacs)

5. Capital Commitments :-

Estimate amount of contract remaining to be executed on Capital Account & not provided for Rs. 24.18 Lacs (P.Y. NIL) against which advance has been paid Of Rs. 4.35 Lacs (P.Y. NIL)

6. The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2015 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

In the opinion of the management, no item of current assets, loans and advances has a value on realization in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

a) Defined benefit plans - Gratuity & Leave Encashment:

Gratuity The company operates a gratuity plan which is administrated through HDFC Standard Life Insurance Company Limited and a trust which is adm inistrated through trustees. Every employee is entitled to a minimum benefit equivalent to 15 days salary last drawn for each completed year of service in line with Payment of Gratuity act, 1972, The same is payable at the time of separation from the company or retirement, whicheverisearlierordeath in service.

Leave Encashment :-The employees are entitled to accumulate compensated absence upto specified days as per company policy, which is payable at the time of separation from company i.e. retirement or death in service at the rate of last drawn salary.

The details on Company's Gratuity and Leave Encashment liabilities employees are given below which is certified by the actuary and relied upon by the auditors.

7. Segment Reporting:

In the opinion of the management the company is mainly engaged in the business of manufacturing of Elastic and ail other activities of the Company revolve around the main business, and as such, there are no separate reportable segments.

8.Related Party Disclosures

a) List of Related Parties and Relationship Relationship Prernco Industries Associate Firm

b) Key Management Personnel - Directors

Mr, Ashok B. Harjani Chairman & Managing Director

Mr. Lokesh P. Harjani Director

c) Key Management Personnel - Otherthan Directors

Mrs. Nisha P. Harjani Chief Financial Officer

d) Relatives of Key Management Personnel Mrs. Sonia A. Harjani Relative Mr. Prem B. Harjani Relative Mr. Suresh B. Harjani Relative

9. Information (to the extent applicable) pursuant to AS 19 :

The Company's significant leasing arrangements are in respect of operating leases for premises (Factory & office premises etc.). These leasing arrangements which are not non-cancellable range between 11 months and 5 years generally, or longer, and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent under Note 28.

10. Corporate Social Responsibility (CSR) Activities

During the year, the Company has spent Rs. 9.49 Lacs towards Corporate Social Responsibility ( CSR ) under section 135 of the Companies Act, 2013 and rules thereon by way of contribution to various Trusts / NGOs / Societies / Agencies.

11. Figures of Previous are regrouped and reclassified wherever necessary.

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Mar 31, 2014

1. Terms/Rights Attached to Shares

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

2. The Long Term Portion of Term Loans are shown under long term Borrowings and the current maturities of long term borrowings are shown under the current liabilities in Note 10(a) as per the disclosure requirements of the Revised Schedule VI

3. DETAILS OF SECURITY AND TERMS OF REPAYMENT

(a) HDFC BANK - Term Loans referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra along with personal guarantee of Lokesh Harjani & Ashok Harjani.

4. NOTE :

Contingent Liabilities :

a) Unredeemed Bank Guarantees are Rs.15.34 Lacs (P.Y. Rs. 16.54 Lacs)

b) Claims against the company not acknowledged as debts

* Income Tax Liability Rs. 6.13 Lacs (P.Y. Nil)

5. NOTE :

The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2014 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

6. NOTE :

In the opinion of the management, no item of current assets, loans and advances has a value on realization in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

7. NOTE :

A) Segment Reporting:

In the opinion of the management the company is mainly engaged in the business of manufacturing of Elastic and all other activities of the Company revolve around the main business, and as such, there are no separate reportable segments.

8. NOTE :

Information (to the extent applicable) pursuant to AS 19:

The Company''s significant leasing arrangements are in respect of operating leases for premises (Factory & office premises etc.). These leasing arrangements which are not non-cancellable range between 11 months and 5 years generally, or longer, and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent under Note 28:.

9. NOTE : Figures of Previous are regrouped and reclassified wherever necessary.

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Mar 31, 2013

NOTE 1:

Contingent Liabilities:

a) Unredeemed Bank Guarantees are Rs. 16.54 Lacs (RY. Rs.18.90 Lacs)

b) Claims against the company not acknowledged as debts

- Income Tax Liability Rs. Nil (P.Y. 2.42 Lacs)

NOTE 2:

The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2013 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

NOTE 3:

In the opinion of the management, no item of current assets, loans and advances has a value on realization in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

NOTE 4:

Consequent to the adoption of Accounting standard on Employee benefits (AS 15) (Revised 2005) issued by the institute of Chartered Accountants of India, the following disclosures have been made by the Standard:

a) The details on Company''s Gratuity and Leave Encashment liabilities employees are given below which is certified by the actuary and relied upon by the auditors.

NOTE 5:

A) Segment Reporting:

In the opinion of the management the company is mainly engaged in the business of manufacturing of Elastic and all other activities of the Company revolve around the main business, and as such, there are no separate reportable segments.

NOTE 6:

Related Party Disclosures

a) List of Related Parties and Relationship Relationship Premco Industries Associate Firm

b) Key Management Personnel

Ashok B. Harjani Chairman & Managing Director

Lokesh P. Harjani Director

c) Relatives of Key Management Personnel

Mrs. Nisha P. Harjani Relative

Mrs. Sonia Harjani Relative

Mr. PremB. Harjani Relative

NOTE 7:

Information (to the extent applicable) pursuant to AS 19:

The Company''s significant leasing arrangements are in respect of operating leases for premises (Factory & office premises etc.). These leasing arrangements which are not non-cancellable range between 11 months and 5 years generally, or longer, and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent under Note 27:.

NOTE 8:

Earning Per Share:

Earning per share computed in accordance with Accounting Standard 20: ''Earning Per Share

NOTE 9:

Information pursuant to Para 3 & 4 of Part II of Schedule VI of the Companies Act, 1956 (to the extent available and as certified by the management) is as under :-

a) Production of Finished Goods

b) Quantitative information in respect of Opening Stock, Closing Stock, Sales and Consumption of Raw Materials (As Certified by Management)

NOTE 10. Figures of Previous are regrouped and reclassified wherever necessary.

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Mar 31, 2012

NOTE a) Cash & Cash equivalent include : cash and Bank balance in Current Account and Unpaid Dividend

b) The cash flow statement as been prepared under the "Indirect method" of AS - 3 "cash flow statement issued by the Institute of Chartered Accountants of India.

1.1 There are no items for reconciliation of the number of shares outstanding at the beginning and at the end of the reporting

1.2 Terms / Rights Attached to Shares

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

1.3 There are no Bonus Shares I Buyback I Shares for consideration other than cash issued during past five years.

2.1 The Calls of Rs. 2,25,000/- (RY. Rs. 2,25,000/-) in Securities Premium Reserve are due from Share holders other than Directors and officers

3.1 The Long Term Portion of Term Loans are shown under long term Borrowings and the current maturities of long term borrowings are shown under the current liabilities in Note 10(a) as per the disclosure requirements of the Revised Schedule VI

3.2 DETAILS OF SECURITY AND TERMS OF REPAYMENT

a) HDFC BANK - Term Loans referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at plot No. 41, Survey no. 35 (PT) Diwan & Sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey No. 202/2, Old Check Post, Dadra & Nagr Haveli, Dadra along with personal guarantee of Lokesh Harjani & Ashok Harjani.

c) ICICI BANK LTD.

Vehicle Loan from Bank are secured by mortgage of Respective Vehicle. The Loan has been fully repaid during the year and the interest applicable on the said loan at the rate of 8.70% p.a.

d) KOTAK MAHINDRA PRIME LTD.

Vehicle Loan from Bank are secured by mortgage of Respective Vehicle.

4.1 The long term portion of Security Deposit Employees are shown under Other Long Term Liabilities and the current maturities of Security Deposit Employees are shown under the current liabilities in note 10(e)(i) as per the disclosure requirements of the Revised Schedule VI

5.1 The long term portion of Provision for Employee Benefits are shown under Other Long Term Provisions and the current portion of Provision for Employee Benefits are shown under the Short Term Provisions in note 11(a) as per the disclosure requirements of the Revised Schedule VI

Working capital referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stock & book debts and plant & machinery along with equitable mortgage on the property situated at Plot No. 41, Survey no. 35 (PT) Diwan & Sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey No. 202/

2, Old Check Post, Dadra & Nagr Haveli, Dadra along with personal guarantee of Lokesh Harjani & Ashok Harjani.

*There is no amount due and outstanding as on 31st March 2012 to be credited to Investor Education and Protection Fund.

14.1 The long term portion of loans & advances given to staff are shown under Long Term Loans & Advances & The Current portion of Loans & Advances given to staff are shown under the short term Loans & Advances in Note 19 as per the disclosure requirements of the revised schedule VI.

The Sales revenue from operations & consumption of Raw material for the year ended 31/03/2011 includes the value of Inter Division Sales & Purchase respectively aggregating of Rs. 618.54 Lacs. During the year the Company has changed the method accounting of sales revenue from operations & consumptions of raw material by excluding the value of interdivision Sales/ purchases of Rs. 708.06 Lacs for the current year. The above has no effect in overall profit / loss of the year. Consequently the sales of the earlier year is overstated to the extent of Rs. 618.54 Lacs.

The Sales revenue from operations & consumption of Raw material for the year ended 31/03/2011 includes the value of Inter Division Sales & Purchase Respectively aggregating of Rs. 618.54 Lacs. During the year the Company has changed the method accounting of sales revenue from operations & consumptions of raw material by excluding the value of interdivision Sales/purchases of Rs. 708.06 Lacs for the current year. The above has no effect in overall profit / loss of the year. Consequently the sales of the earlier year is overstated to the extent of Rs. 618.54 Lacs.

NOTE 6:

Contingent Liabilities :

a) Unredeemed Bank Guarantees are Rs.18.90 Lacs (RY.Rs.18.64 Lacs)

b) Claims against the company not acknowledged as debts

- Claims Rs. Nil (P. Y. 503.35 Lacs)

- Income Tax Liability Rs. 2.42 Lacs (P.Y. 32.01 Lacs)

NOTE 7:

The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2012 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

NOTE 8:

In the opinion of the management, no item of current assets, loans and advances has a value on realization in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

NOTE 9:

Consequent to the adoption of Accounting standard on Employee benefits (AS 15) (Revised 2005) issued by the institute of Chartered Accountants of India, the following disclosures have been made by the Standard :

NOTE 10:

A) Segment Reporting

In the opinion of the management the company is mainly engaged in the business of manufacturing of Elastic Tapes and all other activities of the Company revolve around the main business, and as such, there are no separate reportable segments.

NOTE 11:

Information (to the extent applicable) pursuant to AS 19 :

The Company's significant leasing arrangements are in respect of operating leases for premises (factory, office, premises etc.). These leasing arrangements which are not non-cancellable range between 11 months and 5 years generally, or longer, and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent under Note 27

NOTE 12:

The Financial Statements for the year ended March 31,2011 had been prepared as per the then applicable, per-revised schedule VI to the Companies Act 1956, the financial statements for the year ended March 31,2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figure have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for the previous year figures does not impact recognition and measurement principals followed for preparation of financial statements.

*Note: Interdivision transfer is not consider as sales from FY 2011 -12 onwards.

The Company Shares are listed in Mumbai & Ahmadabad Stock Exchange. The requisite listing fees have been paid.

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Mar 31, 2010

1. Figures of the previous year have been regrouped and rearranged, wherever considered necessary.

2. Contingent Liabilities :

a) Unredeemed Bank Guarantees are Rs.15.95 Lacs (P.Y.Rs.12.95 Lacs)

b) Claims against the company not acknowledged as debts

- Claims Rs. 503.35 lacs (P. Y. 503.35)

- Income Tax Liability Rs. 3.51 (P.Y. 3.12)

3. Estimated amount of contracts remaining to be executed (net of advances) is Rs. 347.28 lacs (P.Y. 565.21 Lacs)

4. The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2010 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

5. In the opinion of the management, no item of current assets, loans and advances has a value on realisation in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

6. Dividend income is accounted on receipt basis.

7. The company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures regarding :

a) Amount due and outstanding to suppliers as at the end of accounting year.

b) Interest paid during the year.

c) Interest payable at the end of the accounting year.

d) Interest accrued and unpaid at the end of the accounting year, have not been given.

The Company is making efforts to get the confirmations from the suppliers as regards their status under the Act.