Notes to Accounts of Texmo Pipes & Products Ltd.

Mar 31, 2024

1 B.4.10 Provisions. Contingent Liabilities and Contingent Assets

(a) Provisions are recognised when the Company has a present obligation {legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Such provisions are determined based on management''s estimate of the amount required to settle the obligation at the balance sheet date. When the Company expects some or all of a provision to be reimbursed, the reimbursement is recognised as a standalone asset only when the reimbursement is virtually certain.

(b) II the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

(c) Contingent liabilities are disclosed on the basis of judgment of the management. These arc reviewed at each balance sheet date and are adjusted to reflect the current management''s estimate.

(d) Contingent assets are not recognized but are disclosed in the financial statements when inflow of economic benefits is probable.

1B.4.11 LncorngJaxeg

(a) Income-Tax expense comprises of current and deferred income tax which has been shown under the head Tax Expenses''. Income

tax expense is recognied in net profit in the Statement of Profit and Loss except to the extent that it relates to items recognized

directly in equity, in which case it is recognized in other comprehensive income.

(b) Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax rates and laws that are enacted or substantively enacted at the Balance sheet date.

(c) Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial

statements and the corresponding tax bases used in the computation of taxable profit.

(d) Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The carrying amount of deferred tax liabilities and assets are reviewed at the end of each reporting period.

1B.4.12 Foreign Currency Transactions and Translations

(a) Transactions in foreign currencies are initially recorded at the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency closing rates of exchange at the reporting date.

(b) Exchange differences arising on settlement or translation of monetary items are recognised in Statement of Profit and Loss except to the extent of exchange differences which are regarded as an adjustment to interest costs on foreign currency borrowings that are directly attributable to the acquisition or construction of qualifying assets, are capitalized as cost of assets.

(c) Non-monetary items that are measured in terms of historical cost in a foreign currency are recorded using the exchange rates at the date of the transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was measured. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e.. translation differences on items whose fair value gain or loss is recognised in OCI or Statement ol Profit and Loss are also recognised in OCI or Statement of Profit and Loss, respectively).

1B.4.13 Empfovee Benefits Expense

(a) Short Term Employee Benefits

The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period when the employees render the services.

(b) Post-Employment Benefits

A defined contribution plan is a post-employment benefit plan under which the Company pays specified contributions to a separate entity. The Company makes specified monthly contributions towards Provident Fund. Superannuation Fund and Pension Scheme. The Company''s contribution is recognised as an expense in the Statement of Profit and Loss dunng the period in which the employee renders the related service. If the contribution payable to the scheme for service received before the balance sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognised as a liability after deducting the contribution already paid. If the contribution already paid exceeds the contribution due for ser/ices received before the balance sheet dale, then excess is recognised as an asset to that extent.

(c) Defined Benefits Plans

(i) The cost of the defined benefit plan and other post-employment benefits and the present value of such obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, mortality rates and future pension increases. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

(ii) The Company pays gratuity to the employees whoever has completed five years of service with the Company at the time of resignation/superannuation. The gratuity is paid @15 days salary for every completed year of service as per the provisions of the Payment of Gratuity Act. 1972.

(iii) The gratuity liability amount is contributed to the approved gratuity fund formed exclusively for gratuity payment to the employees. The gratuity fund has been approved by the governing Income-Tax authorities.

(iv) The liability in respect of gratuity and other post-employment benefits is calculated using the Projected Unit Credit Method and spread over the period during which the benefit is expected to be derived from employees'' services.

(v) Re-measurements of defined benefit plans in respect of post-employment are charged to the Other Comprehensive Income.

(d) Employee Separation Costs

Compensation to employees who have opted for retirement under the voluntary retirement scheme of the Company is payable in the year of exercise of option by the employee. The Company recognises the employee separation cost when the scheme is announced and the Company is demonstrably committed to it.

1B.4.14 Revenue from Operations

(a) Revenue from sale of goods is recognised when the significant risks and rewards of ownership have been transferred to the buyer, recovery of the consideration is probable, the associated cost can be estimated reliably, there is no continuing effective control or managerial involvement with the goods, and the amount of revenue can be measured reliably.

(b) Revenue from rendering of services is recognised when the performance obligation to render the services are completed as per contractually agreed terms.

(c) Revenue from sale of goods & rendering of services is measured at the fair value of the consideration received or receivable after taking into account contractually defined terms of payment and excluding trade discounts, volume rebates and taxes or duties collected on behalf of the Government such as Goods and Services Tax [GST]. However, mere for the representation purposes, in the Statement of Profit and Loss, value of sales, at once, is shosvn inclusive of Goods & Services Tax and subsequently, such Goods & Services Tax are reduced.

1B.4.15 Other Income

(a) Interest Income

For an Debt Instruments measured either at Amortized Cost or at Fair Value through Other Comprehensive Income, interest income is recorded using the Effective Interest Rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset or to the amortized cost of a financial liability.

(b) Dividend Income

Dividend income is recognised only when the right to receive the same is established, it is probable that the economic benefits associated with the dividend will flow to the Company, and the amount of dividend can be measured reliably.

1B.4.16 Goods and Services Tax IGSTl

The Goods & Services Tax balances, as appearing in the Balance Sheet of the Company, arc subjoct to the reconciliation at the time of furnishing the annual GST returns of the company, under the Goods and Services Tax Enactments, for the financial year 2023-24.

1 B.4.17 Insurance Claims

(a) Insurance claims are accounted lor on the basis of claims admitted/ expected to be admitted to the extent that there is no uncertainty in receiving the claims.

(b) The Company is expecting the settlement of insurance claims lodged by it. within next twelve months and therefore, the Company has classified such Insurance Claims Receivables under the head ''Other Current Assets’ in the Balance Sheet.

1 B.4.18 Incentives Receivable from Government

(a) VAT Incentive receivables from Government under TRIFAC are accounted lor on the basis of claims admitted/ expected to be admitted to the extent that there is no uncertainty in receiving the claims.

(b) The Company is expecting the settlement of incentive receivables lodged by it. within next twelve months and therefore, the Company has classified such incentive receivables under the head Other Current Assets'' in the Balance Sheet.

1B.4.19 Financial Instruments

(a) Financial Assets

(i) lail''9l_recQaaif.^n and measurement

All financial assets and liabilities are initially recognized at fair value. Transaction costs that are directly attributable to the acquisition or issue cl financial assets and financial liabilities, which are not at fair value through profit or loss, are adjusted to the fair value on initial recognition. Purchase and sale of financial assets are recognised using trade date accounting.

(ii) Subsequent measurement

Financial assets carried at amortised cost

A financial asset is measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms ol the financial asset give rise on specified dates to cash Hows that are solely payments ot principal and interest on the principal amount outstanding.

Financial assets at fair value through other comprehensive income (FVTOCh

A financial asset is measured at FVTOCI if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms ot the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial assets at fair value through profit or loss (FVTPL)

A financial asset not classified as either amortised cost or FVOCI is classified as FVTPL.

(iii) Investment m subsidiaries. Associates and Joint Ventures

The Company has elected to measure investment in its wholly owned subsidiaries Tapti Pipes & Products Ltd., FZE, UAE''

& ''Shree Venkatesh Polymers Pvt. Ltd.’ and its partially owned subsidiary ''Shree Venkatesh Industries Pvt. Ltd.'' at its Fair Value.

(rv) Other Equity Investments

All other equity Investments are measured at fair value, with value changes recognised in Statement of Profit and Loss, except for those equity investments for which the Company has elected to present the value changes in ''Other Comprehensive Income''.

In accordance with Ind AS 109, the Company uses ‘Expected Credit Loss'' (ECL) model, tor evaluating impairment o! financial assets.

Expected credit losses are measured through a loss allowance at an amount equal to:

• The 12-months expected credit losses (expected credit losses that result from those default events on the financial instrument that are possible within 12 months after the reporting date); or

• Full lifetime expected credit losses (expected credit losses that result from all possible default events over the life of the financial instrument)

For trade receivables Company applies ''simplified approach'' which requires expected lifetime losses to be recognised from initial recognition of the receivables. The Company uses historical default rates to determine impairment loss on the portfolio of trade receivables. At every reporting date these historical default rates are reviewed and changes in the forward looking estimates are analysed.

For other assets, the Company uses 12 month ECL to provide for impairment loss where there is no significant increase in credit risk. If there is significant increase in credit risk full lifetime ECL is used.

(b) Financial Liabilities

(i) Initial recognition and measurement

All financial liabilities are recognized at fair value and in case of loans, net of directly attributable cost. Fees of recurring nature are directly recognised in the Statement of Profit and Loss as finance cost.

(ii) Subsequent, measurement

Financial liabilities are carried at amortized cost using the effective interest method. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short matunty of these instruments.

(lii) Derivative financial instruments and Hedge Accounting

Derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered

into and are also subsequently measured at fair value. Denvatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative. Any gains or losses arising from changes in the fair value of derivatives are taken directly to Statement of Profit and Loss, except for the effective portion of cash flow hedges which is recognised in Other Comprehensive Income and later to Statement of Profit and Loss when the hedged itom affects profit or loss or treated as basis adjustment if a hedged forecast transaction subsequently results in the recognition of a norvfinancial assets or non-financial liability.

Hedges that meet the criteria for hedge accounting are accounted for as follows:

Cash flow hedge

The Company designates derivative contracts or non derivative financial assets / liabilities as hedging instruments to mitigate the risk of movement in interest rates and foreign exchange rates for foreign exchange exposure on highly probable future cash flows attributable to a recognised asset or liability or forecast cash transactions. When a derivative is designated as a cash flow hedging instrument, the effective portion of changes in the fair value of the derivative is recognized in tho cash flow hedging reserve being part of other comprehensive income. Any ineffective portion of changes in the fair value of the derivative is recognized immediately in the Statement of Profit and Loss. If the hedging relationship no longer meets Ihe criteria for hedge accounting, then hedge accounting is discontinued prospectively. If the hedging instrument expires or is sold, terminated or exercised, Ihe cumulative gain or loss on Ihe hedging instrument recognized in cash flow hedging reserve till the period the hedge was effective remains in cash flow hedging reserve until the underlying transaction occurs. The cumulative gain or loss previously recognized in the cash flow hedging reserve is transferred to the Statement of Profit and Loss upon the occurrence of the underlying transaction. If the forecasted transaction is no longer expected to occur, then the amount accumulated in cash flow hedging reserve is reclassified in the Statement of Profit and Loss.

Fair Valye Hedge

The Company designates derivative contracts or non derivative financial assets / liabilities as hedging instruments to mitigate the risk of change in fair value of hedged item due to movement in interest rates, foreign exchange rates and commodity prices.

Changes in the fair value of hedging instruments and hedged items that are designated and quality as fair value hedges are recorded in the Statement of Profit and Loss. If the hedging relationship no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item for which the effective interest method is used is amortised to Statement of Profit and Loss over the period of maturity.

(iv) Derecognition of financial instruments

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109. A financial liability (or a part of a financial liability) is derecognized from the Company''s Balance Sheet when the obligation specified in the contract is discharged or cancelled or expires.

1B.4.20 Operating.Cys''e

(a) The Company presents its assets and liabilities in the balance sheet based on current/non-current classification which is based upon the Company''s operating cycle. The Company has identified twelve months as its operating cycle.

(b) An asset is treated as current when it is:

(i) Expected to be realized or intended to be sold or consumed in normal operating cycle;

(ii) Held primarily for the purpose of trading;

(iii) Expected to be realized within twelve months after the reporting period: or

(iv) Cash or cash equivalent unless restricted from being oxchangcd or used to settle a liability for at least twelve months after the reporting period

(c) A liability is treated as current when :

(i) It is expected to be settled m normal operating cycle:

(ii) It is incurred primarily for the purpose of trading:

(iii) It is due to be settled within twelve months after the reporting period, or

(iv) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

(d) Deferred tax assets and liabilities are classified as non-current assets and liabilities.

1B.4.21 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 dunng the period. The weighted average number of equity shares outstanding during the period are adjusted for events of shares issued during the year including bonus issue.

For the purpose of calculating diluted earnings per share, the not profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

IB. 4.22 Dividend Distribution

Dividends paid is recognised in the period in which the interim dividends are approved by the Board of Directors, or in respect of the final dividend when approved by the shareholders.

1 B.4.23 Statement of Cash Flows

(a) Cash and Cash equivalents

For the purpose of presentation m the statement of cash flows, cash and cash equivalents includes cash on hand, other short-lerm. 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 ot changes in value.

(b) The Statement of Cash Flows has been prepared under the ''Indirect Method'' as set out in Indian Accounting Standard (Ind AS) 7 on ''Statement of Cash Flows''.

NQTE^_1_C^CRLTICAL ACCOUNTIf^ JUDGMEjjTS A^DJ<^Y^S0yRCES^F^ESTIjMT10N UNCERTAINTY

The preparation of the standalone financial statements in conformity with the Ind AS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities and disclosures as at date of the financial statements and the reported amounts of the revenues and expenses for the years presented. 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 under different assumptions and conditions. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized 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 periods if the revision affects both current and future periods.

IC. 1 Depreciation / amortisation and useful lives of property plant and equipment / intangible assets

Property, Plant and Equipment / Intangible assets are depreciated / amortised over their estimated useful lives, after taking into account estimated residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of depreciation / amortisation to be recorded during any reporting period. The useful lives and residual values are based on the Company''s historical experience with similar assets and take into account anticipated technological changes. The depreciation / amortisation for future periods is revised if there are significant changes from previous estimates.

1C. 2 Bgsflyg£ai2iBlluOj^ t_Reseiyafeia

Judgments are required in assessing the recoverability of overdue trade receivables and determining whether a provision against those receivables is required. Factors considered include the credit rating of the counterparty, the amount and timing of anticipated future payments and any possible actions that can be taken to mitigate the risk of non-payment.

1C.3 Provisions

Provisions and liabilities are recognized in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition and quantification of the liability requires the application of judgment to existing facts and circumstances, which can be subject to change. The carrying amounts of provisions and liabilities are reviewed regularly and revised to take account of changing facts and circumstances.

^CA Impairment of non-fmancial assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, the Company estimates tho asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or Cash Generating Units {CGU s) fair value less costs of disposal and its value in use. It is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or a groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use. the estimated future cash flows are discounted to their present value using pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if no such transactions can be identified, an appropriate valuation model is used.

1 C.5 Impairment of financial assets

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

NOTE-39- OBCLOSUBESAS REWIND AS 116-LEASES"

APPLICATION OF IND AS 116

Ministry of Corporate Affairs ("MCA") through Companies (Indian Accounting Standards) Amendment Rules, 2019 and Companies (Indian Accounting Standards) Second Amendment Rules, has notified Ind AS 116 Leases, which replaces the existing lease standard. Ind AS 17 Leases, and other interpretations. Ind AS 116 sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. It introduces a single, on-balance sheet lease accounting model for lessees.

The Company has adopted Ind AS 116, effective annual reporting penod beginning 1st April, 2021 and applied the standard to its leases. Accordingly, the Company has measured its lease liability as at 1st April. 2021 at the present value o( the remaining lease payments, discounted using the interest rale of 8.95% p.a. implicit in the lease at the date of transition to Ind AS.

The Right-of-Use Asset has been recognised at an amount equal to the lease liability. Accordingly, a Right-of-Use asset of ? 1371.53 Lakhs has been recognized in F.Y. 2021-22. The cumulative effect on transition in retained earnings net off taxes is ? Nil.

On application of Ind AS 116. the nature of expenses has changed fiom lease rent in previous periods to depreciation cost for the Right-of-Use asset, and finance cost for interest accrued on lease liabilities.

The Company does not have an option to purchase such leasehold land at the end of the lease period. There are no restrictions such as those concerning dividends, additional debts and further leasing Imposed by the lease agreements.

Ind AS 116 has resulted in an increase in net cash inflows from operating activities and an increase in cash outflows Irom financing activities on account of lease payments. The principal and interest portion of the lease payments have been disclosed under cash flow from financing activities which for the year ended March 31 si, 2024. aggregating to ? 229.03 Lakhs (Previous Year ? 210.80 Lakhs).

5 Defined Benefit Plan:

The Company has defined benefit plans for gratuity to eligible employees contributions for which are made to Life Insurance Corporation of India, who invests the funds as per IRDA guidelines. The details of these defined benefit plans recognized in the financial statements are as under:

G8neral.Pescnpti.onpf.Ahe.PJ.an

The Company operates a defined benefit plan (the Gratuity Plan) covering eligible employees, which provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employees salary and the tenure of employment.

The defined benefit plans typically expose the company to various risk such as :

(a) Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. If Ihe return on plan asset is below this rate, it will create plan deficit.

(b) Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the plan assets.

(c) Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

(d) Salary risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan''s liability.

Sensitivity analysis of 1% change in exchange rate at the end of reporting period net of hedges

(c) Foreign Currency Sensitivity

For every'' percentage point change in the underlying exchange rate of the outstanding foreign currency denominated assets and liabilities, including derivative contracts, holding all other variables constant, the profit before tax for the year ended 31st March, 2024 would change by 12520.51 USD [Previous Year - 12520.51 USD). However, the management of the Company docs not expects its foreign currency denominated financial assets to mature within a period of five years from the end of the year under review.

(d) Interest Rate Risk

Interest rate risk is the risk that the future cash flow with respect to interest payments on borrowing will fluctuate because of change in market interest rates. The company''s exposure to the risk ot changes in market interest rates relates primarily to the Company''s long-term debt obligation with floating Interest rates.

(e) Interest Rate Sensitivity

Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rates. Any movement in the reference rates could have an impact on the Company''s cash flows as well as costs.

The Company is subject to variable interest rates on some of its interest beanng liabilities. The Company''s interest rate exposure is mainly related to debt obligations. The Company also uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements for its day to day operations like short term loans.

As at March 31. 2024, financial liability of ? 888.13 lakhs was subject to vanable interest rates. Incroase/decrcase of 100 basis points in Interest rates at the balance sheet date would result in decrease/lncrease in profit/(loss) before tax of ? 1.30 Lakhs for the year ended March 31.2024.

The model assumes that interest rate changes are instantaneous parallel shifts in the yield curve. Although some assets and liabilities may have similar maturities or periods to re-pricing, these may not react correspondingly to changes in market interest rates. Also, the Interest rates on some types cf assets and liabilities may fluctuate with changes in market interest rates, while interest rates on other types of assets may change with a lag.

The risk estimates provided assume a parallel shift of 100 basis points interest rate across all yield curves. This calculation also assumes that the change occurs at the balance sheet date and has been calculated based on risk exposures outstanding as at that date. The period end balances are not necessarily representative of the average debt outstanding during the period.

(Note The impact is indicated on the profiV(loss) before tax basis).

(f) Commodity Price Risk

Commodity price risk arises due to fluctuation in prices of raw material. The company has a risk management frame work aimed at prudently managing the risk arising from the volatility in raw material prices and freight costs. The company''s commodity risk is managed centrally through well-established trading operations and control processes. In accordance with the risk management policy, the Company carefully calibrates the timing and the quantity of purchase.

(g) Credit Risk

Credit risk is the risk that a customer or counterparty to a financial instrument fails to perform or pay the amounts due causing financial toss to the company. Credit risk anscs mainly from the outstanding receivables from customers. The company has a prudent and conservative process for managing its credit risk arising in the course of its business activities. The credit ratings/market standing of the customers are evaluated on a regular basis.

(h) Liquidity Risk

Liquidity risk arises from thG Company''s inability to meet its cash flow commitments on time. Prudont liquidity risk management implies maintaining sufficient stock of cash and marketable securities . The Company maintains adequate cash and cash equivalents along with the need based credit limits to meet the liquidity needs.

(i) Hedge Accounting

The Company has established risk management policies to hedge the volatility arising from exchange rate fluctuations in respect of firm commitments and highly probable forecast transactions, through foreign exchange forward and options contracts. The proportion of forecast transactions that are to be hedged is decided based on the size of the forecast transaction and market conditions. As the counterparty for such transactions are highly rated banks, the risk of their non-performance is considered to be insignificant.

The Company uses derivatives to hedge its exposure to changes in movement in foreign currency. Where such derivatives are not designated under hedge accounting, changes in the fair value ol such hedges are recognised in the Statement of Profit and Loss.

The Company may also designate certain hedges, usually for largo transactions, as a cash flow hedge under hedge accounting, with the objective of shielding the exposure from variability in cash flows. The currency, amount and tenure of such hedges are generally matched to the underlying transacbon(s). Changes in the fair value of the eltective portion of cash flow hedges are recognised as cash llow hedging reserve in Other Comprehensive Income. While the probability of such hedges becoming ineffective is very low, the ineffective portion if any. is immediately recognised in the Statement of Profit and Loss.

The management of the Company does not expects its foreign currency denominated financial assets to mature within a period of five years from the end of the year under review and therefore, it has not entered into any hedging contracts for the same.

E»PJJ^7^AODITIONAL REGULATORY INFORMATION

(i) During the financial year 2023-24 no proceeding has been initiated or pending against the company tor holding any benami properly under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

(il) The Company has filed quarterly returns or statements with the banks In lieu of sanctioned working capital facilities, which arc in agreement with the books of account other than those as set out below:

(iii) The company is not declared a wilful defaulter by any bank or financial institution or any other lender.

(iv) The company has not entered into any material transaction with the companies slruck-ofl under s. 248 of the Companies Act. 2013 or section 560 of the Companies Act. 1956 during the year.

(v) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

(vi) The company has complied with the number of layers presented under clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules. 2017

(vii) The company has not applied for any Scheme of Arrangements in terms of Sections 230 to 237 of the Companies Act, 2013.

(viii) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies). including foreign entities f Intermedianes") with the understanding.whether recorded in v/riting or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf ol the Ultimate Beneficiaries.

For Anil Kamal Garg & Company For and on the behalt of Board

Chartered Accountants

ICAI Firm Registration No. 004I86C

Devendra Bansal Sanjay Kumar Agrawal Vijay Prasad Pappu

Partner Managing Director Whole Time Director cum CFO

Membership No. : 078057 DIN: 00316249 DIN : 02066748

ICAI UDIN : 24078057BKGOUV2313

Mohit Agrawal Ajay Shrivastava

Chiel Executive Ollicer Company Secretary

Indore, May 29th. 2024 Burhanpur, May 29th, 2024

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Mar 31, 2018

1. CORPORATE INFORMATION

Texmo Pipes and Products Limited (“the Company”) was formed as a Partnership Firm by the name M/s Shree Mohit Industries on 13^th May 1999 and was subsequently converted and incorporated as a Public limited Company in July 2008 with the Registrar of Companies, Madhya Pradesh and Chhattisgarh. The Partnership Firm was converted into Company under Part IX of the Companies Act, 1956 under the name of Texmo Pipes and Products Limited having Certificate of Incorporation dated 3rd July 2008.

2.1 BASIS OF PREPARATION AND PRESENTATION

The standalone financial statements have been prepared on a historical cost basis, except for the following assets and liabilities which have been measured at fair value:

- Certain financial assets and liabilities (including derivative instruments) and

- Defined benefit plans - plan assets

The financial statements of the Company have been prepared to comply with the Indian Accounting standards (''Ind AS''), including the rules notified under the relevant provisions of the Companies Act, 2013.

Upto the year ended March 31, 2017, the Company has prepared its financial statements in accordance with the requirement of Indian Generally Accepted Accounting Principles (GAAP), which include Standards notified under the Companies (Accounting Standards) Rules, 2006 and considered as “Previous GAAP”.

These financial statements are the Company''s first Ind AS standalone financial statements.

Company''s financial statements are presented in Indian Rupees (INR), which is also its functional currency.

1. The company has availed the deemed cost exemption in relation to the property, plant and equipment except in case of Land, that is valued at its fair value, on the date of transition i.e. April 1,2016 and hence the net carrying amount has been considered as the gross carrying amount on that date.

2. Freehold Land has been revalued at Rs.6447.13 Lakhs as per requirement of lND AS. Previous value as per GAAP was Rs.198.70Lakhs.

3. Entire movable and immovable Property, Plants and Equipment are mortgaged in favour of secured lenders against the sanction limits. (Note 18)

4. All intangible assets are other than internally generated.

5. In respect of Intangible as sets; a) Useful life is as follows

(i) In respect of Computer Software average useful life 4 - 5 years.

Notes: # The Company retired from the LLP w.e.f. January 10, 2018

*Aggregate amount of diminution in value of investments is Rs.3194 Lakhs as at March 31, 2018, as at March 31, 2017 and as at April 1, 2016.

Note : Refer note 42 for detailed disclosure on the fair values.

Includes portion of compound financial instrument and fair valuation of loan of Rs.594.64 Lakhs as at March 31, 2018, Rs.596.63 Lakhs as at March 31, 2017 and Rs.597.55 Lakhs as at April 1, 2016

Note: The cost of inventories recognized as an expense during the year is disclosed in Note 28, 29 and 30.

Borrowings are secured by first paripassu charge on stock (including raw material, finished goods and work in progress) and book debts. (Note 17)

Terms / Rights to Shareholders

(1) Equity Shares

(A) Voting

(i) The Company has one class of equity shares having a per value of f 10 per share. Each shareholder is eligible for one vote per share held. 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.

Notes:

Nature and Purpose of reserve

Securities premium Account - The amount received in excess of face value of the equity shares is recognized in Securities Premium Account. This reserve is available for utilization in accordance with the provisions of the Companies Act, 2013.

Revaluation Reserve - The company has created revaluation reserve out of revaluation of land carried out during the year 2016-17.

Retained Earnings - Retained Earnings are the profits/losses that the Company has earned till date

* Current Items include amount payable in the next 12 months Notes :

(i) Amount stated in Current maturity is disclosed under the head of “Other Financial Liabilities (Current)” (Note 22).

(ii) Refer Note 42 for information about liquidity risk.

(iii) Term Loans are Secured by way of first charge, in respect of Fixed assets, both present and future, and second charge on entire current assets of the Company both present and future. (Note 3,10,11)

3. Nature of Security and terms of repayment for Long Term Secured Borrowings HDFC Bank Term Loan of Rs.83.71 Lakhs (Previous Year: Rs.92.54Lakhs) secured by Mumbai office of the Company.

Repayable in 120 equal monthly installments starting from May 2014 . Last installment due in April 2024. Rate of interest 12% p.a. as at year end.(Previous Year 12%).

Bank of Baroda Term Loan for Plant & Machinery of Rs.66.62 Lakhs (Previous Year: Rs.180.14 Lakhs), repayable within 66 months including initial moratorium period of 6 months, repayable by October 2019, secured on pari pasu charge on plant & Machinery and Personal Guarantees of Mr. Sanjay Kumar Agrawal, Mrs. Rashmidevi Agrawal, Shree Padmavati Irrigation LLP, Balaji Industries and Venkatesh Industries.

Repayable in 60 equal monthly installments starting from November 2013. Last installment due in November 2018. Rate of interest 12.08% p.a. as at year end.(Previous Year 13.50%).

Vehicle Loans of Rs.231.57 Lakhs (Previous Year: Rs.261.29 Lakhs). The Loans are secured by way of hypothecation of respective motor vehicle purchased. Repayable in 36 to 60 equal monthly instalments. Rate of interest in range of 9.44% to 9.81% p.a. (Previous year 9.81% to 14% p.a.).

Secured Loan From Others include Loan from Religare Fin Vest Limited of Rs.64.81 Lakhs (Previous Year: Rs.71.75 Lakhs), secured by Equitable Mortgage of Indore Office. Repayable in 120 equal monthly instalments starting from May 2014. Last instalment due in April 2024.. Rate of interest is 13.50% p.a. at the year end. (Previous year 13.50% p.a.).

Secured Loan From Others include Loan from Reliance Capital Limited of Rs.40.19 Lakhs (Previous Year: f 60.71Lakhs), secured by Hypothecation of Plant & Machinery , disbursed in November 2015 of Rs.83.00 Lakhs repayable by January 2016.

Repayable in 48 equal monthly installments starting from January 2016. Last installment due in December 2019. Rate of interest is 12% p.a. at the year end. (Previous year 15% p.a.).

Central Bank of India Term Loan for plant & Machinery is Rs.317.83 Lakhs (Previous Year: Rs.385.43 Lakhs), secured by Pari Pasu charge on Plant & Machinery with SBI situated at Factory Premises Present & Future and Personal Guarantees of Directors Mr. Sanjay Kumar Agrawal, Mrs. Rashmidevi Agrawal, M/s Balaji Industries, M/s Shree Padmavati irrigations LLP and Shree Venkatesh Industries.

Repayable in 84 equal monthly installments starting from October 2016. Last installment due in September 2023.. Rate of interest is 12.65% p.a. at the year end. (Previous year 13.95% p.a.)

Punjab National Bank Term Loan for Plant & Machinery of Rs.703.85 Lakhs (Previous Year: Rs.Nil), repayable within 84 months including initial moratorium period of 5 months, repayable by March 2025, secured on pari pasu charge on plant & Machinery and Guarantees of Mr. Sanjay Kumar Agrawal, Mrs. Rashmidevi Agrawal, Shree Padmavati Irrigation LLP, Balaji Industries and Venkatesh Industries.

Repayable in 84 equal monthly installments starting from April 2018. Last installment due in March 2025. Rate of interest 10.55% p.a. as at year end.

Terms of loans from Related Parties

i) Loans & Advances from Related parties Include Loan from Managing Director Mr. Sanjay KumarAgrawal of Rs.3.49 Lakhs (Previous Year - Rs.46.25 Lakhs) , Director Mrs. Rashmi Devi Agrawal - Rs.11.00 Lakhs (Previous Year - Rs.57.50Lakhs) & Shree Padmavati Irrigations LLP, Indore- Rs.19.00 Lakhs (Previous Year - Rs.325.25Lakhs). The Loans taken from Related Parties are Interest free.

a. Working Capital Loans are from Consortium of Banks State Bank of India, Bank of Baroda , Punjab National Bank and Central Bank of India led by State Bank of India where in, SBI Cash Credit Loan of Rs.2735.37 Lakhs (Previous Year: Rs.3221.31 Lakhs), Bank Of Baroda Cash Credit Loan of Rs.681.49 Lakhs (Previous Year: Rs.3221.31 Lakhs), Punjab National Bank cash Credit Loan of f345.91 Lakhs (Previous Year: f392.50 Lakhs) and Central Bank of India Cash Credit Loan of Rs.188.52 Lakhs (Previous Year: Rs.197.81 Lakhs) secured by first Pari pasu charge (between consortium members) on whole of companies present & future stocks of Raw Material, Finished Goods, Stock in Process, Stores & Spares and other Raw Material, and the company''s present and future book debts, outstanding monies, receivable, claims, bills, Contracts, engagements, securities, investments, rights and assets of the company. The working capital facilities as above are further secured by way of equitable mortgage of Immovable Properties of the company and promoters, Related Entities and Personal Guarantees of Mr. Sanjay Kumar Agrawal, Mrs. Rashmidevi Agrawal, Shree Padmavati Irrigations LLP, Shree Balaji Industries and Shree Venkatesh Industries.

b. Working Capital Loans from others includes Raw Material NSIC assistance of Rs.198.97 Lakhs (Previous Year: Rs.351.43 Lakhs) and is secured by bank guarantees.

4.1 Information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company. This has been relied upon by the Auditor.

4.2 Refer Note 42 for information about credit risk, market risk and liquidity risk of Trade payables.

- It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings.

- The Company does not expect any reimbursements in respect of the above contingent liabilities.

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

The Company''s pending litigations comprise of claims against the Company pertaining to proceedings pending with Excise, Income Tax, Sales/ VAT tax and other authorities. The Company has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed as contingent liabilities where applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a materially adverse effect on its financial statements

1. The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflations, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

2. The expected contribution for Defined Benefit Plan for the next financial year will be in line with FY 2017-18.

3. The company makes provident fund (PF) contributions to defined contribution benefit plans for eligible employees. Under the scheme the company is required to contribute a specified percentage of the payroll costs to fund the benefits. The contributions specified under the law are paid to the government authorities (PF commissioner).

4. Amount towards Defined Contribution Plan have been recognized under “Contribution to Provident and Other funds” in Note 28 Rs.120.52 Lakhs (Previous Year: Rs.102.40 Lakhs).

5. Defined Benefit Plan:

The Company has defined benefit plans for gratuity to eligible employees, contributions for which are made to Life Insurance Corporation of India, who invests the funds as per IRDA guidelines. The details of these defined benefit plans recognized in the financial statements are as under:

General Description of the Plan:

The Company operates a defined benefit plan (the Gratuity Plan) covering eligible employees, which provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employees salary and the tenure of employment.

The defined benefit plans typically expose the company to various risk such as;

- Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end ofthe reporting period on government bonds. If the return on plan asset is below this rate, it will create plan deficit.

- Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the plan assets.

- Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

- Salary risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary ofthe plan participants will increase the plan''s liability.

The amount outstanding are unsecured and will be settled in cash. No expense has been recognized in the current or prior years for bad or doubtful debts in respect of amounts owned by related parties.

* Balance outstanding at the end of the year/previous years are stated without considering impact of fair valuation carried out as per Ind AS. a) Part of the Unsecured Loan from Related Parties classified as Equity Component in the Statement of Changes in Equity is:

5. Preferential allotment :

The Company has, on a preferential basis, issued Rs.12,00,000 (Twelve Lakhs) equity shares of f 10 each, fully paid up at a price of f 22 per share aggregating to Rs.264.00 Lakhs to Shree Padmavati Irrigation LLP, a promoter group company on October 06, 2017, in accordance with the provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009.

6. During the year the Management has revised the estimated useful life of Dies & Moulds from 8 years to 12 years.

Accordingly, the Depreciation charge for FY 2017-18 is lower by Rs.172.67 lakhs.

7. FINANCIAL INSTRUMENTS

All financial instruments are initially recognized and subsequently re-measured at fair value as described below:

(a) The fair value of Forward Foreign Exchange contracts and is determined using forward exchange rates at the balance sheet date.

(b) All foreign currency denominated assets and liabilities are translated using exchange rate at reporting date.

Fair Value measurement hierarchy:

Interest Rate Risk

Interest rate risk is the risk that the future cash flow with respect to interest payments on borrowing will fluctuate because of change in market interest rates. The company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligation with floating interest rates.

Interest Rate Sensitivity

Te following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the Company''s profit before tax is affected through the impact on floating rate borrowings, as follows:

Commodity Price Risk

Commodity price risk arises due to fluctuation in prices of raw material. The company has a risk management frame work aimed at prudently managing the risk arising from the volatility in raw material prices and freight costs. The company''s commodity risk is managed centrally through well-established trading operations and control processes. In accordance with the risk management policy, the Company carefully caliberates the timing and the quantity of purchase Credit Risk

Credit risk is the risk that a customer or counterparty to a financial instrument fails to perform or pay the amounts due causing financial loss to the company. Credit risk arises mainly from the outstanding receivables from customers. The company has a prudent and conservative process for managing its credit risk arising in the course of its business activities. The credit ratings/market standing of the customers are evaluated on a regular basis.

Liquidity Risk

Liquidity risk arises from the Company''s inability to meet its cash flow commitments on time. Prudent liquidity risk management implies maintaining sufficient stock of cash and marketable securities . The Company maintains adequate cash and cash equivalents alongwith the need based credit limits to meet the liquidity needs.

Hedge Accounting

The Company avails Foreign Currency Demand Loans from bank time to time to reduce the interest cost. The Company takes forward cover to hedge against the foreign currency risks. The amount of foreign currency risks and forward cover are as under :

Operating Leases

(a) There were no non-cancellable operating lease. (b) The Company pays rent for office premises at Indore and Mumbai. The lease period is for 11 months with option to renew. The payments for office premises at Indore are to related parties. None of the lease agreements have any restrictions concerning dividend, additional debt and further leases.

Reconciliation Notes explaining Reclassification Adjustments

1 .Investment Property classified as Non current Investments under the previous GAAP has been reclassified to Investment Property under Ind AS.

2. Loans and Advances in the nature of financial assets have been reclassified as Financial Assets- Loans. Under the previous GAAP, such loans were classified as Other Non- Current assets.

3. Other Current Assets, under the previous GAAP includes Loans and Advances which have been classified as Financial Assets- Other Financial assets under the Ind AS.

4. Other Current Liabilities under the previous GAAP includes Current Maturities of Long Term Debts and Interest accrued but not due on borrowings which have been classified as Other Financial Liabilities under the Ind AS.

5. Provision for Tax was classified as Other Non Current Liabilities under the previous GAAP. Under the Ind AS, it has been reclassified to Current Tax Liabilities shown as net of Advance Tax and TDS.

Reconciliation Notes explaining Ind AS Adjustments

1. The company has exercised the option of carrying the Freehold Land, Investment property and Land Held for Sale at its fair value on the date of transition. This has resulted in increase in Property, Plant and Equipment by Rs.6,248.43 Lakhs, Investment Property by Rs.21.52 Lakhs and Other Current Assets by Rs.177.66 Lakhs and there is corresponding impact on Revaluation Reserve by Rs.6,447.61 Lakhs.

2. The company has exercised the option of carrying the Investments in its subsidiaries at its fair value on the date of transition. Consequently, there is decrease in Non Current Investments by Rs.3,194 Lakhs on that date.

3. As per Ind AS 109 "Financial Instruments", Interest free loans to subsidiary has been carried at amortized cost. Accordingly, Financial Assets- Loans have decreased and Other current assets have increased by Rs.22.99 Lakhs and Rs.24.83 Lakhs as on 01.04.2016 and 31.03.2017 respectively.

4. The transaction costs paid for the term loans borrowed have been amortized over the period of the loans, as the loans are required to be carried at amortized cost as per IndAS 109 "Financial Instruments". Consequently, the Borrowings have reduced by Rs.9.51 Lakhs and Rs.8.47 Lakhs as at 1st April 2016 and 31st March 2017 respectively.

5. Under the Ind AS, the Deferred Tax is calculated on the basis of the Balance Sheet approach and not the Income approach. Consequently, the Deferred Tax Liabilities (Net) have been increased by Rs.23.70 Lakhs and Rs.19.88 Lakhs as at 1st April 2016 and 31st March 2017 respectively.

6. The company has borrowed interest free unsecured loans from promoters/directors. Such loans have been classified as compound financial instruments and split into debt and equity in accordance with Ind AS 32 "Financial Instruments : Presentation". Accordingly, Borrowings have decreased and Other Equity increased.

8. Effect of Ind AS Adoption on the Statement of Profit and Loss for the year ended March 31, 2017

1. Under the Ind AS, the actuarial gains and losses are classified as part of the Other Comprehensive Income under the head Items that are not reclassified to Profit and Loss. There is no impact on the Total Comprehensive Income.

2. The company has borrowed interest free unsecured loans from promoters/directors. Such loans have been classified as compound financial instruments and bifurcated as debt and equity in accordance with Ind AS 32 "Financial Instruments : Presentation". The interest on debt component have been recognized in accordance with Ind AS 109 "Financial Instruments". Accordingly, there is an increase in Finance Cost.

3. The transaction costs paid for the term loan borrowed have been amortized over the period of the loans, as the loans are required to be carried at amortized cost as per IndAS 109 "Financial Instruments". Consequently, there is an impact on Finance Cost.

4. Under the Ind AS, significant components of plant and equipment which have different useful life are depreciated based on their specific useful lives. Consequently, the amount of Depreciation charged for the year ended 31st March 2017 has increased by Rs.50.31 Lakhs.

5. Under the Ind AS, the Deferred Tax is calculated on the basis of the Balance Sheet approach and not the Income Approach. As a result the net Deferred Tax for the FY 2016-17 is lower by Rs.3.82 Lakhs as against Deferred Tax recognized under previous GAAP.

9. Reconciliation of total comprehensive income for the year ended March 31, 2017 44.

APPROVAL OF FINANCIAL STATEMENTS

The financial statements were approved for issue by the board of directors on May 29, 2018.

10. Trade Receivables/Payables are confirmed by the Management. No independent balance confirmation has been received from Customers/Suppliers. The above figures are subject to reconciliation and consequent adjustment, if any.

11. The company has established Unit No. 2 and is eligible for incentive under Madhya Pradesh Industrial Investment Promotion Assistance Scheme-2004, Wherein 50% of VAT and CST paid shall be refunded till 30^th June,2017. During the year ended 31st March 2018, incentive as mentioned are booked in Other Operating Income of Rs.9.49 Lakhs (P. Y Rs.28.75 Lakhs).

12. Segment Reporting : The company is primarily engaged in business of plastic products which constitutes a single reportable segment in accordance with IND AS 108 ''Operating Segments’

13. Insurance Claim Receivable

During the year 2010-11 on 21.03.2011 a fire occurred in main raw material godown at the factory premises of the Company. The Company has lodged a claim of Rs.25.47 Crores with the Oriental Insurance Company Limited and the same was accounted as ''Insurance Claim Receivable''. The claim is finally settled by the Insurance Company for Rs.1640.86 Lakhs on 12.04.2012. The Management has filed a lawsuit against the Insurance Company as the claim is fully recoverable. The Management is confident of realizing the amount due from the Insurance Company and according no adjustments are made to the financial results of the company in this regard.

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Mar 31, 2016

Contingent assets are neither recognized nor disclosed in the financial statements.

1-Rights, Preferences and restrictions attached to Equity Shares

The Company has only one class of equity shares having a par value of ? 10/-per share-Each shareholder is -eligible for one vote per share-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 of their share -holding.

2-During previous year Company has adopted estimated useful life of Fixed Assets as stipulated by Schedule II of the companies Act 2013-Accordingly, Adjustments to Fixed Assets of Rs-5.22 Lakhs (net of Deferred Tax of Rs-2.50 Lakhs) on Account of Assets whose useful Life is already exhausted on April 01,2014 has been adjusted against General Reserve.

3. Nature of Security and terms of repayment for Long Term Secured Borrowings : Terms of Repayment for loan Related Parties

4.-Loans & Advances from Related parties Include Loan from The loan is Interest free and repayable after three Managing Director Mr-Sanjay Agrawal of Rs-280.00 Lakhs (Previous years.

5. Year - Rs-55.00 Lakhs) , Chairperson Mrs-Rashmi Devi Agrawal Rs-55.00 Lakhs (Previous Year - Rs-25.00 Lakhs) & Shree Padmavati Irrigations Pvt-Ltd., Indore- Rs-50.00 Lakhs (Previous Year - Nil)

6.: Installments falling due within a year in respect of all the above loans aggregating Rs-215.09 Lakhs (Previous Year Rs-203.19) Lakhs have been grouped under "current Maturities of long term debt (refer note 8) .

7- Working Capital Loans are from Consortium of Banks State Bank of India, Bank of Baroda , Punjab National Bank and Central Bank of India led by State Bank of India where in, SBI Cash Credit Loan of Rs-3065.59 Lakhs (Previous Year: Rs-2699.87 Lakhs), Bank Of Baroda Cash Credit Loan of Rs-590.44 (Previous Year: Rs-645.81 Lakhs), Punjab National Bank cash Credit Loan of Rs-348.89 Lakhs (Previous Year: Rs-381.23 Lakhs)and Central Bank of India Cash Credit Loan of Rs.176.18 Lakhs (Previous Year: Rs.184.29 Lakhs) secured by first Pari-pasu charge (between consortium members) on whole of companies present & future stocks of Raw Material, Finished Goods, Stock in Process, Stores & Spares and other Raw Material, and the companies present and future book debts, outstanding monies, receivable, claims, bills, Contracts, engagements, securities, investments, rights and assets of the company-The working capital facilities as above are further secured by way of equitable mortgage of Immovable Properties of the company and promoters, Related Entities and Personal Guarantees and Corporate Guarantees of Mr-Sanjay Kumar Agrawal, Mrs Rashmidevi Agrawal, Shree Padmavati Irrigations Private Limited, Shree Balaji Industries and Shree Venkatesh Industries.

8-Working Capital Loans from others includes Raw Material NSIC assistance of Rs.464.60 Lakhs (Previous Year: Rs.473.33 Lakhs) and is secured by bank guarantees-

9-The identification of suppliers as Micro, Small and Medium Enterprise defined under" The Micro, Small and Medium Enterprises Development Act, 2006" was done on the basis of information to the extent provided by the suppliers of the Company- .

Note 10-During previous year pursuant to the enactment of companies Act 2013, the Company has applied the estimated useful lives as specified in schedule II, except in respect of certain assets as disclosed in Accounting Policy on Depreciation and Amortization-Accordingly the amortized carrying value is being depreciated/Amortized over the revised/remaining useful lives-The written down value of Fixed Assets whose lives have expired as at 1st April 2014 have been adjusted net of tax, in the opening balance of Profit and Loss account amounting to Rs-5.22 lakh

11- During previous year the company has converted loan and advances amounting to Rs.4351.78 Lakhs given to Tapti Pipes & Products Ltd-FZE a wholly owned subsidiary into share capital vide Board resolution dated 27.09.2014-Accordingly, The Company has applied for necessary approval to the Authorized Dealer; However the approval is pending till date.

12- During the current year Texmo Petrochemicals Private limited (wholly owned subsidiary) was converted into Limited Liability Partnership under Limited Liability Partnership Act, 2008.

13-Stock of Finished goods includes uninsured consignment stock of Rs.102.28 Lakhs (P.Y-Rs.153.11 Lakhs) and stock at branch of Rs-91.06 Lakhs (RY-Rs-41.41 Lakhs)-In respect of inventory lying with consignees'' no third party confirmation is being obtained.

14- Insurance Claim Receivable

During the year 2010-11 on 21.03.2011 a fire occurred in main Raw Material godown at the factory

15- premises of the Company and the Company has lodged the claim of Rs-2547.69 Lakhs with the Insurance

16- Company and the same was accounted as ‘Insurance Claim Receivable’-The Claim is finally settled by

17- Insurance Company for Rs-1640.86 Lakhs on 12.04.2012-The Management has filed lawsuit against the

18- Insurance Company as the claim is fully recoverable-The Management is confident of realizing the

19- amount due from the Insurance Company and accordingly no adjustments are made to the financial

20- results of the Company in this regard.

21.- During the year search u/s 132(1) of the Income Tax 1961 was carried out at the various business - premises of the company and at the residential premises of the directors and its associates-The - Income Tax Department has made certain preliminary observations of the various affairs of the - company but the final tax liability has not been ascertained and the matter is still under investigation-- The management is of the view that in pursuance of the search no extra tax liability emerges and - therefore it has not been considered necessary to make provision for additional tax liability-In view of - same the Company has not filed the Income Tax Return for the Assessment Year 2015-16 i.e-Financial - Year 2014-15 and the tax liability of Rs-58.25 Lakhs net off advance tax and TDS is not paid till date of - audit.

22. It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings as it is determinable only on receipt of judgments/decisions pending with various forums/authorities

23. The Company does not expect any reimbursements in respect of the above contingent liabilities.

24. The Company’s pending litigations comprise of claims against the Company pertaining to proceedings pending with Income Tax, Sales/ VAT tax and other authorities-The Company has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed as contingent liabilities where applicable, in its financial statements-The Company does not expect the outcome of these proceedings to have a materially adverse effect on its financial statements.

25.-In accordance with AS-28 issued by ICAI, the carrying amounts of assets have been reviewed at year -end for indication of impairment loss, if any-As there is no indication of impairment of assets, no loss has -been recognized during the year.

26. The Company is engaged mainly in production of pipes and fittings as such is the only reportable

27. segment as per Accounting Standard on Segment Reporting (AS-17) issued by the Institute of

28. Chartered Accountants of India-The geographical segmentation is not relevant as the company mainly

29. operates within India.

30.-The Company has recognized exchange differences arising on foreign currency items in line with Accounting Standard-11 Pursuant to above Net Exchange Loss on purchase of Raw Material and Machinery Spare Parts relating to the financial year 2015-16 amounting to Rs-1.13 Lakhs (PY Rs-4.43 Lakhs) has been recognized as Expense.

31. Balances of creditor and debtors/advances are subject to confirmation/reconciliation and consequential adjustment, if any.

32. The company has established Unit No-2 and is eligible for incentive under Madhya Pradesh Industrial Investment Promotion Assistance Scheme-2004, Wherein 75% of VAT and CST paid shall be refunded till F.Y 2018-19.During the year ended 31st March 2016, incentive as mentioned are booked in Other Operating Income of Rs-137.10 Lakhs (RY Rs-171.15 Lakhs).

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

34. In the opinion of the Board of Director the current assets, loans and advance have a virtue of realization in ordinary course of business at least equal to the amount at which they are stated and the provision for all known liabilities are adequate and not in excess of the amount of reasonably necessary.

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Mar 31, 2015

Contingent assets are neither recognized nor disclosed in the financial statements.

1. The Company has recognized exchange differences arising on foreign currency items in line with Accounting Standard-11 Pursuant to above Net Exchange Loss on purchase of Raw Material and Machinery Spare Parts relating to the financial year 2014-15 amounting to Rs. 4.43 Lacs (PY Rs. 26.78 Lacs) has been recognized as Expense.

2. Balances of creditors and debtor/advances are subject to confirmation/reconciliation and consequential adjustments, if any.

3. The Company has established Unit no. 2 and is eligible for incentive under Madhya Pradesh Industrial Investment Promotion Assistance Scheme-2004, wherein 75% of VAT and CST paid shall be refunded till F.Y 2018-19. During the year ended 31st March 2015, incentive as mentioned are booked in Other Operating Income of Rs. 171.15 Lacs (P.Y 83.53 Lacs).

4. In the opinion of the Board of Directors the current assets, loans and advances have a value of realization in ordinary course of business at least equal to the amount at which they are stated and the provision for all known liabilities are adequate and not in excess of the amount reasonably necessary.

---

Mar 31, 2014

1. Insurance Claim Receivable

During the year 2010-11 on 21.03.2011a fire occurred in the main Raw Material godown at the factory premises of the company and the company has lodged the claim ofRs 2547.69 Lacs with the Insurance Company and the same was accounted as ''Insurance Claim receivable''. The Claim is finally settled by the Insurance company for 1640.86 Lacs on 12.04.2012. The Management has filed lawsuit against the Insurance Company as the claim is fully recoverable. The management is confident of realizing the amount due from the Insurance Company and accordingly no adjustments are made to the financial results of the Company in this regard.

2. Contingent Liabilities and Commitments not provided for :



Contingent Liabilities not provided for in respect of: in Rs Lacs 31st March 2014 31st March 2013

a. Disputed Income Tax Demands 58.80 39.28

b.Disputed VAT,CST & Entry Tax Demands 253.00 301.38

c. Guarantees given by the company''s 664.50 262.59 Bankers in the normal course of business

d. Letter of Credit for Puchase of goods 104.81 148.79

3. In accordance with AS-28 issued by ICAI, the carrying amounts of assets have been reviewed at year end for indication of impairment loss, if any. As there is no indication of impairment of assets, no loss has been recognized during the year.

4. The Company is engaged mainly in production of pipes and fittings as such is the only reportable segment as per Accounting Standard on Segment Reporting (AS-17) issued by the Institute of CharteredAccountants of India. The geographical segmentation is not relevant as the company mainly operates within India.

5. Related Party Transactions:

As per Accounting Standard(AS-18) on Related Party issued by ICAI, The Disclosures of Transaction with related parties are as follows:

Party

Key Management Personnel

Relative of Key Management Personnel

Subsidiary Companies

Enterprises in which Key Managerial Personnel and Relatives of Key Managerial Personnel are able to exercise significant influence

Associate Enterprise

Relationship

Shri Sanjay Agrawal (Managing Director)

Shri Vijay Prasad Pappu (Whole Time Director)

Mrs. Rashmi Devi Agrawal

Texmo Petrochemicals Private Limited

Tapti Pipes and Products Ltd FZE

Shree Padmavati Irrigations Private Limited Venkatesh Industries

C.P. Industrial Products Private Limited

Rahul Developers Private Limited

Shree Vasudeo Industries

Mangal Murti Minerals

Previous year figures are shown in brackets

34. The Company has recognized exchange differences arising on foreign currency items in line with Accounting Standard-11 Pursuant to above net exchange loss on purchase of Raw Material and Machinery Spare parts relating to the financial year 2013-14 amounting toRs 26.78Lacs (PY 3090Lacs)hasbeenrecognized as Expense.

Figures in brackets refer to previous year.

6. Balances of creditors and debtor/advances are subject to confirmation/reconciliation and consequential adjustments, if any.

7. The Company has established Unit no. 2 and is eligible for incentive under Madhya Pradesh Industrial Investment Promotion Assistance Scheme-2004, wherein 75% of VAT and CST paid shall be refunded till F.Y 2018-19. During the year ended 31st March 2014, incentive as mentioned are booked in Other Operating Income ofRs.83.53 Lacs(P.YRs 111.60 Lacs).

8. The Total Capital of the Firm ''Mangal Murti Minerals'' isRs 45.80 Lacs. There are four partners'' in the firm (including the company). Each partner (including the company) has equal proportion of interest in the firm i.e 25%. Name of the Partners'' (Other than the company) are Mr. Prakash Jain, Mrs. Nisha Dubey and Mrs. Seema Jain.

9. In the opinion of the Board of Directors the current assets, loans and advances have a value of realization in ordinary course of business at least equal to the amount at which they are stated and the provision for all known liabilities are adequate and not in excess of the amount reasonably necessary.

Statement Pursuant to Section 212(8) of The Companies Act, 1956

As per AS-21 issued by the institute of Chartered Accountants of India, the financial statements of the company reflecting the consolidation of the accounts of its subsidiary companies to the extent of equity holding of the company in these companies are included in this Annual Report.

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

Note: The above figures are as per audited financials.

Undertaking:-

We undertake that the annual accounts of the subsidiary companies and related detailed information will be made available to the investors, who seek such information, at any point of time. The annual accounts of the subsidiary companies will also be kept for inspection by the investor in the registered office of Texmo Pipes and Products Limited and that of subsidiary companies concerned.

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Mar 31, 2013

BACKGROUND

Texmo Pipes and Products Limited was formed as a Partnership Firm by the name M/s Shree Mohit Industries on 13th May 1999 and was subsequently converted and incorporated as a Public Limited Company in July 2008 with the Registrar of Companies, Madhya Pradesh and Chhattisgarh. The Partnership Firm was converted into Company under Part IX of the Companies Act, 1956 under the name of Texmo Pipes and Products Limited having Certificate of incorporation dated 3rd July 2008.

1. Insurance Claim Receivable

During the year 2010-11 on 21.03.2011 a fire occurred in the main Raw Material godown at the factory premises of the company and the company has lodged a claim of Rs. 2547.69 Lacs with the Insurance Company and the same was accounted as Insurance Claim receivable. The Claim is finally settled by the Insurance company for Rs. 1640.86 Lacs on 12.04.2012. The Management has initiated legal action against the Insurance Company as the claim is fully recoverable. The management is confident of realizing the amounts due from the Insurance Company and accordingly no adjustments are made to the financial results of the Company in this regard and the same is shown under contingent liability by the company.

2. Contingent Liabilities and Commitments not provided for :

Amount in Rs. Lacs

Contingent Liabilities not provided for in respect of: 31st March 2013 31st March 2012

a.Disputed Income Tax Demands 39.28 59.79

b.Disputed VAT,CST & Entry Tax Demands 301.38 307.10

c.Guarantees given by the company''s Bankers 687.59 873.27 in the normal course of business

d.Insurance Claim Receivable 769.50 ----

Amount in Rs. Lacs

Capital Commitments not provided for in respect of: 31st March 2013 31st March 2012

Capital Assets 357.97 ----

3. In accordance with AS-28 issued by ICAI, the carrying amounts of assets have been reviewed at year end for indication of impairment loss, if any. As there is no indication of impairment of assets, no loss has been recognized during the year.

4. The company has raised USD $ 99,96,075 (Approx Rs. 4,402.27 Lacs) through GDR (Global Depository Receipts) issue in the month of April 2011 by issuance of 627500 GDR Equivalent to Rs. 125.50 Lacs equity shares) of USD $ 15.93 each. The funds raised through the issue are invested and advanced to wholly owned foreign Subsidiary ''Tapti Pipes & Products Ltd FZE''.

5. The Company is engaged mainly in production of pipes and fittings as such is the only reportable segment as per Accounting Standard on Segment Reporting (AS-17) issued by the Institute of Chartered Accountants of India. The geographical segmentation is not relevant as the company mainly operates within India.

6. The Company has recognized exchange differences arising on foreign currency items in line with Accounting Standard-11 Pursuant to above net exchange gain on purchase of raw material and Machinery Spare parts relating to the financial year 2012-13 amounting to Rs. 30.90 Lacs (PY Rs. 57.35 Lacs (Loss)) has been recognized as income.

Figures in brackets refer to previous year.

7. The Unit II of the Company is exempted from Payment of Entry Tax under the Scheme of Government of Madhya Pradesh for the period 29.08.2008 to 28.08.2013.

8. Balances of creditors and debtors/advances are subject to confirmation/reconciliation and consequential adjustments, if any.

9. During the year ended 31st March 2013, other operating income includes an amount of Rs. 111.60 Lacs (P.Y Rs. 156.41) being VAT/CST refund receivable in accordance with the Madhya Pradesh Udhyog Samvardhan Scheme, 2004.

10. In the opinion of the Board of Directors the current assets, loans and advances have a value of realization in ordinary course of business at least equal to the amount at which they are stated and the provision for all known liabilities are adequate and not in excess of the amount reasonably necessary.

11. The Previous Year figures have been re-grouped and re-classified to confirm to current year''s classification. This adoption does not impact recognition and measurement principles followed for preparation of financial statements as on 31st March, 2013.

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Mar 31, 2012

BACKGROUND

Texmo Pipes and Products Limited was formed as a Partnership Firm by the name M/s. Shree Mohit Industries on 13th May 1999 and was subsequently converted and incorporated as a Public Limited Company in July 2008 with the Registrar of Companies, Madhya Pradesh and Chhattisgarh. The Partnership Firm was converted into Company under Part IX of the Companies Act, 1956 under the name of Texmo Pipes and Products Limited having Certificate of incorporation dated 3rd July 2008.

a) Bank of India Term Loan for Office and Godown Indore of Rs. 105.17 Lacs (Previous Year: Rs. 133.94 Lacs) repayable within 57 equal monthly installments repayable by November 2015 secured by Equitable mortgage of respective immovable properties and personal guarantees of Mr. Sanjay Agrawal and Mr. Vij ay Prasad Pappu Directors and Mrs. Rashmidevi Agrawal relative of Director.

b) HDFC Bank Term Loan of Rs. 83.17 Lacs (Previous Year : Rs. Nil) repayable within 120 equal monthly installments repayable by October 2021 secured by office No. 412, Mumbai

c) SBI Term Loan of Rs. 438.86 Lacs (Previous Year : Rs. 557.93 Lacs) repayable within equal monthly installments repayable by June 2014 secured by exclusive charge on the fixed assets of the company and equitable mortgage of Lands and buildings at Burhanpur and Indore and personal guarantees of Mr. Sanjay Agrawal Director and Mrs. Rashmidevi Agrawal relative of Director and corporate guarantee of Shree Padmavati Irrigations Private Limited.

d) Vehicle Loans are Secured by way of hypothecation of respective motor vehicles purchased.

i. Bank of India Vehicle Loan ofRs. 25.72 Lacs (Previous Year: Rs. 63.44 Lacs) repayable within 54 equal monthly installments. Repayable by September 2015

ii. HDFC Bank Limited Vehicle Loan of Rs. 53.21 Lacs (Previous Year: Rs. 3.30 Lacs) repayable within 36 equal monthly installments. Repayable by January 2015.

Notes to the financial statement for the year ended 31st March 2012

a) SBI Cash credit Loan ofRs. 4290.83 Lacs (Previous Year: Rs. 4739.62 Lacs) secured by Hypothecation of Stocks, Book debts and Other Current Assets and mortgage on all immovable and movable assets of the company and promoters and personal guarantees of Mr. Sanjay Agawam and Mr. Vij ay Prasad Pappu Directors and Mrs. Rashmidevi Agrawal relative of Director.

b) Raw Material NSIC assistance ofRs. 475.39 Lacs (Previous Year : Rs. 471.52 Lacs) is secured by bank guarantees

c) No terms and conditions as to repayment and interest are stipulated in respect of the Unsecured loan from parties

b) The identification of suppliers as micro, small and medium enterprise defined under "The Micro, Small and Medium Enterprises Development Act, 2006" was done on the basis of information to the extent provided by the suppliers of the Company.

1. Contingent Liabilities and Commitments not provided for

Amount in Rs Lacs

Contingent Liabilities As at 31st March 2012 As at 31st March 2011

a. Disputed Income Tax Demands 59.79 11.09

b. Disputed VAT,CST & Entry Tax Demands 307.10 256.33

c. Guarantees given by the Company's Bankers in the normal course of business 873.27 933.04

2. Insurance Claim Receivable

During the year 2010-11 on 21/03/2011 a fire occurred in main Raw Material Godown at the Factory Premises of the Company and the Company has lodged a Claim ofRs. 2547.69 Lacs with the Insurance Company and the same was accounted as Insurance Claim Receivable under Current Assets. The Claim is finally settled by the Insurance Company for Rs. 1640.86 Lacs on 12.04.2012. The Management is initiated legal action against the Insurance Company as the claim is fully recoverable. The Statutory Auditors has emphasized the above matter in their audit report. The management is confident of realizing the amounts due from the Insurance Company and accordingly no adjustments are required to be made to the financial results of the Company as at 31 st March 2012 in this regard.

3. In accordance with AS-28 issued by ICAI, the carrying amounts of assets have been reviewed at year end for indication of impairment loss, if any. As there is no indication of impairment of assets, no loss has been recognized during the year.

4. The company had raised USD $ 99,96,075 (Approx. Rs. 4402.27 Lacs) through GDR(Global Depository Receipt) issue in the month of April 2011 by issuance of627500 GDR(equivalent to 125.50 Lacs equity shares) of USD $ 15.93 each. The Funds raised through the issue are invested in Money Market Instruments and in wholly owned subsidiary abroad.

5. The Company is engaged mainly in production of pipes and fittings as such is the only reportable segment as per Accounting Standard on Segment Reporting (AS-17) issued by the Institute of Chartered Accountants of India. The geographical segmentation is not relevant as the company mainly operates within India.

6. The Company has recognized exchange differences arising on foreign currency items in line with Accounting Standard-11 Pursuant to above net exchange loss on purchase of raw material relating to the financial year 2011-12 amounting to Rs. 57.35 Lacs (PY gain ofRs. 20.63 Lacs) has been recognized as expense.

7. The Unit 2 of the Company is exempted from Payment of Entry Tax under the Scheme of Government of Madhya Pradesh for the period 29.08.2008 to 28.08.2013.

8. Balances of creditors and debtors/advances are subject to confirmation/reconciliation and consequential adjustments, if any.

9. In the opinion of the Board of Directors the current assets, loans and advances have a value of realization in ordinary course of business at least equal to the amount at which they are stated and the provision for all known liabilities are adequate and not in excess of the amount reasonably necessary.

10. During the year ended 31 st March 2012, other operating income includes an amount of Rs. 156.02 Lacs being VAT/CST refund receivable in accordance with the Madhya Pradesh Udhyog Samvardhan Scheme, 2004.

11. The Previous Year's figures have been re-grouped / re-classified to confirm to this year's classification which is as per the Revised Schedule VI. This adoption does not impact recognition and measurement principles followed for preparation of financial statements as on 31 st March 2012.

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Mar 31, 2011

BACKGROUND

Texmo Pipes and Products Limited was formed as a Partnership Firm by the name M/s Shree Mohit Industries on 13th May 1999 and was subsequently converted and incorporated as a Public Limited Company in July 2008 with the Registrar of Companies, Madhya Pradesh and Chhattisgarh.

The Partnership Firm was converted into Company under Part IX of the Companies Act, 1956 under the name of Texmo Pipes and Products Limited having Certificate of incorporation dated 3rd July 2008.

1.Contingent Liabilities not provided Amt in Rs.(Lacs)Amt in Rs.(Lacs) for in respect of: 31st March 11 31st March 10

a) Disputed Income Tax Demands 11.09 11.09

b) Disputed VAT,CST& Entry Tax Demands 256.33 --

c) Guarantees given by the Company's Bankers in 933.04 324.48 the normal course of business

d) Import Letter of Credits issued by Company's Bankers -- 72.00

2. Insurance Claim Receivable

During the year on 21/03/2011 a fire occurred in main Raw Material Godown at the Factory Premises of the Company and the Company has lodged a Claim of Rs.25.47 Crores with the Insurance Company and the same is accounted as Insurance Claim Receivable under Current Assets.

2. In accordance with AS-28 issued by ICAI, the carrying amounts of assets have been reviewed at year end for indication of impairment loss, if any. As there is no indication of impairment of assets, no loss has been recognized during the year.

3. Disclosure under the Micro, Small and Medium Enterprise Development Act, 2006:

a) The information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company.

4. The Company is engaged mainly in production of pipes and fittings as such is the only reportable segment as per Accounting Standard on Segment Reporting (AS-17) issued by the Institute of Chartered Accountants of India. The geographical segmentation is not relevant as the company mainly operates within India.

5. Stock Details

Additional information pursuant to the provisions of paragraphs 3, 4C & 4D of Part II of Schedule Vl of the Companies Act,1956.

Details of Capacity, Products Manufactured, Traded, Turnover, Opening Stock, Closing Stock of Goods Produced for Sale & Traded:

6. The Company has recognized exchange differences arising on foreign currency items in line with Accounting Standard-11 Pursuant to above net exchange gain on purchase of raw material and fixed asset relating to the financial year 2010-11 amounting to Rs. 20.63 Lakhs (PY Rs. 14.67 Lakhs) has been recognized as income.

7. The company's subsidiary "Tapti Pipes & Products Limited FZE, U.A.E" was incorporated on 13/03/2011 and no activities were started since incorporation. Therefore Consolidated Financial Statements as per AS-21 are not prepared.

8. The Unit 2 of the Company is exempted from Payment of Entry Tax under the Scheme of Government of Madhya Pradesh for the period 29.08.2008 to 2808.2013.

9. In Fixed Assets there are nine vehicles which are not registered in name of Company but are registered in nameoferstwhilefirms.

10. Balances of creditors and debtors/advances are subject to confirmation/reconciliation and consequential adjustments, if any.

11. In the opinion of the Board of Directors the current assets, loans and advances have a value of realization in ordinary course of business at least equal to the amount at which the yare stated and the provision forall known liabilities are adequate and not in excess of the amount reasonably necessary.

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Mar 31, 2010

BACKGROUND

Texmo Pipes and Products Limited was formed as a Partnership Firm by the name M/s Shree Mohit Industries on 13th May 1999 and was subsequently converted and incorporated as a Public Limited Company in July 2008 with the Registrar of Companies, Madhya Pradesh and Chhattisgarh. The Partnership Firm was converted into Company under Part IX of the Companies Act, 1956 under the name of Texmo Pipes and Products Limited having Certificate of incorporation dated 3rd July 2008.

1. Contingent Liabilities not provided for in respect of:

Amt in Rs.

3Ist. March 10

a) Disputed Income Tax Demands 11,09,563.00

b) Guarantees given by the Companys Bankers in the normal course of business 3,24,48,188.10

c) Import Letter of Credits issued by Companys Bankers 72,00,000.00

2. In accordance with AS-28 issued by ICAI, the carrying amounts of assets have been reviewed at year end for indication of impairment loss, if any. As there is no indication of impairment of assets, no loss has been recognized during the year.

3. Disclosure under the Micro, Small and Medium Enterprise Development Act, 2006:

a) The information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company.

b) Disclosure in accordance with Section 22 of the Act read with Notification No. GSR 719(E) dated 16thNovember2007 issued by the Ministry of Corporate Affairs: -

4. Payment to Statutory Auditors includes fees for Statutory & Tax Audit (Net of Service Tax) of Rs.2,00,000/-.

5. The Company is engaged mainly in production of pipes and as such is the only reportable segment as per Accounting Standard on Segment Reporting (AS-17) issued by the Institute of Chartered Accountants of India. The geographical segmentation is not relevant as there is no export turnover.

6. Related Party Transactions:

As per Accounting Standard (AS-18) on Related Party Disclosures Issued by ICAI, The Disclosures of Transaction with the related Parties are as Follows-

Party Relationship

Sanjay Agrawal Managing Director-Key Management Personnel

Rashmi Devi Agrawal Relative of Key Mangement Personnel

M/s Shree Padmavati Irrigations Pvt. Ltd. Reiated Party-Common Control Exists

M/s Shree Venkatesh Industries Related Party-Common Control Exists

Vijay Prasad Pappu Whole Time Director-Key Management Personnel

Shri Narendra Agrawal Relative of Key Mangement Personnel

7. The Unit 2 of the Company is exempted from Payment of Entry Tax under the Scheme of Government of Madhya Pradesh for the period 29.08.2008 to 28.08.2013.

8. In Fixed Assets there are nine vehicles which are not registered in name of Company but are registered in name of erstwhile firms.

9. Balances of creditors and debtors/advances are subject to confirmation/reconciliation and consequential adjustments, if any.

10. In the opinion of the Board of Directors the current assets, loans and advances have a value of realization in ordinary course of business at least equal to the amount at which they are stated and the provision for all known liabilities are adequate and not in excess of the amount reasonably necessary.

11. The previous year figures are for the period of 03rd July 2008 to 31st March 2009 hence they are incomparable with current year figures. Figures for the previous year have been regrouped/reclassified wherever necessary.

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Mar 31, 2009

BACKGROUND

Texmo Pipes and Products Limited was formed as a Partnership Firm by the name M/s Shree Mohit Industries on 13th May 1999 and was subsequently converted and incorporated as a Public Limited Company in July 2008 with the Registrar of Companies, Madhya Pradesh and Chhattisgarh. The

Partnership Firm was converted into Company under Part IX of the Companies Act, 1956 under the name of Texmo Pipes and Products Limited having Certificate of incorporation dated 3rd Ju!y 2008.

1. Contingent Liabilities not provided for in respect of: Amt in Rs. 31st March 09

a. Disputed Income Tax Demands 5,11,418.00

b. Guarantees given by the Companys Bankers in the normal 36,70,493.00 course of business

c. Import Letter of Credits issued by Companys Bankers 64,00,000.00

2. Deferred Tax

In accordance with AS-22 issued by ICAI, the deferred tax liability of Rs.26,59,103/- has been shown as deferred tax debit for the year. The cumulative deferred tax liability is due to difference in book and tax depreciation and Gratuity.

3. In accordance with AS-28 issued by ICAI, the carrying amounts of assets have been reviewed at year end for indication of impairment loss, if any. As there is no indication of impairment of assets, no loss has been recognized during the year.

4. Security for Secured Loans:

Principal Terms of Secured Loans and Assets Charged as Security

1. The Term Loan from ICICI Bank is taken for purchase of Trucks (Swaraj Mazda) against the Hypothecation of Trucks financed and which are charged in favour of the Bank. The Term Loan is repayable in Equity Monthly Installments and is repayable within one year.

2. The Term Loan from Bank of India is taken for purchase of Motor Car (Scorpio) against the Hypothecation of Motor Car financed and is charged to the Bank.

3. The Term Loan from IDBI Bank Ltd is taken for acquisition of Plant & Machineries against the Primary security of Plant & Machineries acquired and common collateral securities as for working capital finance mentioned below.

Collateral Security:

Equitable Mortgage of Plot and building ay 596/1, Renukamata mandir road, Burhanpur owned by Shri Narendra Agrawal.

Extension of Hypothecation charge all the plant and machineries of the Company.

Equitable mortgage of factory land & building situated at KH no 98-99 & 100 at Bahadrapur Road, Burhanpur, Madhya Pradesh of the Company.

Equitable mortgage of land at KH no 95 , 107/1, 107/2 and 107/3 at Bahadrapur Road, Burhanpur, Madhya Pradesh in the name of Smt Rashmi Devi Agrawal, Shri Sanjay Agrawal.

Equitable mortgage of Two Godowns at 22,23 Maha veer Market, LohaMandi, Indore in the name of Shri Sanjay Agrawal and Smt Rashmi Devi Agrawal.

RIPD of Rs.4.00 Lakhs and FDR of Rs.50 Lakhs duly discharged and kept as security.

Guarantors:

Mr. Sanjay Agrawal, Mr. Narendra Kumar Agrawal, Ms. Rashmidevi Agrawal, Mr. Ratilal Dalai Mr. Vijay Prasad Pappu and corporate guarantee of Shree Padmavati Irrigations Private Limited.

5. Micro, Small and Medium Enterprise Development Act, 2006:

During the year, the Company has circulated request to all the suppliers to confirm their status under Micro, Small and Medium Enterprises Act, 2006 and despite regular follow up the Company has not received confirmations from any suppliers and hence disclosures relating to amounts unpaid as at the year end together with interest paid/payable under this Act have not been given.

7. Payment to Statutory Auditors includes fees for Statutory & Tax Audit of Rs.50,000/-. The remuneration debited to Profit & Loss A/c does not include Rs.2,00,000/- towards services rendered for proposed Initial Public Offer of the Company which is considered as an Expenditure for Public Issue and shall be set off against the balance of Share Premium Account after the issue.

8. The Company is engaged mainly in production of pipes and as such is the only reportable segment as per Accounting Standard on Segment Reporting (AS-17) issued by the Institute of Chartered Accountants of India. The geographical segmentation is not relevant as there is no export turnover.

9. Related Party Transactions:

As per Accounting Standard (AS-18) on Related Party Disclosures Issued by ICAI, The Disclosures of Transaction with the related Parties are as Follows-

Party Relationship

Sanjay Agrawal Managing Director-Key Management Personnel

Rashmi Devi Agrawal Relative of Key Mangement Personnel

M/s Shree Padmavati Irrigations Pvt.Ltd. Related Party-Common Control Exists

M/s Shree Venkatesh Industries Related Party-Common Control Exists

M/s Shree Balaji Industries Related Party-Common Control Exists

Vijay Prasad Pappu Whole Time Director-Key Management Personnel

Shri Narendra Agrawal Relative of Key Mangement Personnel

11. The Unit 2 of the Company is exempted from Payment of Entry Tax under the Scheme of Government of Madhya Pradesh for the period 29.08.2008 to 28.08.2013.

12. During the year the Company acquired specified assets and liabilities of Shree Balaji Industries and Shree Padmavati Irrigation P Ltd vide Business Transfer Agreements dated 5th August 2008 and of Shree Venkatesh Industries vide Business Transfer Agreement dated 6th August 2008. The Assets and Liabilities are accounted on date of execution of Business Transfer Agreement in the books of the Company.

14. Balances of creditors and debtors/advances are subject to confirmation/reconciliation and consequential adjustments, if any.

15. In the opinion of the Board of Directors the current assets, loans and advances have a value of realisation in ordinary course of business a least equal to the amount at which they are stated and the provision for all known liabilities are adequate and not in excess of the amount reasonably necessary.

16. This being the first year of the Company previous years figures are not available.

17. The Company has been formed on 3rdJuly 2008. Therefore the financial statements have been prepared for the period from 3rdJuly 2008 to 31stMarch 2009