2.19 Provisions and contingencies
A provision is recognised when the company has a present obligation as a result of past event and it is probable that
an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.
These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which
will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within
the control of the Company or a present obligation that arises from past events where it is either not probable that
an outflow of resources will be required to settle the obligation or a reliable estimate of the amount cannot be made.
Contingent assets are neither recognised nor disclosed in the financial statements.
2.20 Earnings per share (EPS)
Basic earnings per share is computed by dividing profit or loss attributable to equity shareholders of the Company by
the weighted average number of equity shares outstanding during the year.
2.21 Cash dividend to equity holders
The company recognises a liability to make cash distributions to equity holders when the distribution is authorised
and the distribution is no longer at the discretion of the company. As per the corporate laws in India, a distribution is
authorised when it is approved by the shareholders. A corresponding amount is recognised directly in equity.
2.22 Government grant
Government grants are recognised at their fair value when there is a reasonable assurance that the grant will be
received and company will comply with all attached conditions.
Government grants relating to income are deferred and recognised in the statement of profit and loss over the period
necessary to match them with costs that they are intended to compensate and presented within other income.
Government grants relating to purchase of property, plant and equipment are initially recognised as deferred income at
fair value and subsequently recognised in the statement of profit and loss on a systematic basis over the useful life of
the asset.
Note - 33: Income Taxes
As per Ind As 12 An explanation of the relationship between tax expense (income) and accounting profit in either or both of
the following forms need to be disclosed:
- a numerical reconciliation between tax expense (income) and the product of accounting profit multiplied by the applicable
tax rate, disclosing also the basis on which the applicable tax rate is computed;
or
- a numerical reconciliation between the average effective tax rate and the applicable tax rate, disclosing also the basis on
which the applicable tax rate is computed;
The above said reconcilation will not arise in situations where there is accounting losses to taxable Income.
Note - 35: Financial risk management
The Company has exposure to the following risks arising from financial instruments:
Ý Credit risk ;
Ý Liquidity risk ; and
Ý Market risk
(A) Credit risk
Credit risk arises from cash and cash equivalents, deposits with banks, security deposits, as well as credit exposure to
outstanding receivables.
Credit risk management
The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing
activities, including deposits with banks and other financial instruments. For banks and other financial institutions,
only high rated banks/ financial institutions are accepted. The balances with banks, loans given to employees, security
deposits are subject to low credit risk and the risk of default is negligible or nil. Hence, no provision has been made for
expected credit loss for credit risk arising from these financial assets.
Trade receivables
Credit risk arises from the possibility that customer will not be able to settle their obligations as and when agreed. To
manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial
condition, current economic trends, analysis of historical bad debts, ageing of accounts receivable and forward looking
information. Individual credit limits are set accordingly. The credit risk is considered low given the past experience of
negligible or minimal write-offs.
(B) Liquidity risk
Liquidity risk is the risk that the Company may encounter difficulty in meeting its obligations. The Company monitors
rolling forecast of its liquidity position on the basis of expected cash flows. The company has obtained fund based /
Non-fund based working capital facilities from banks.
Exposure to liquidity risk
The tables below analyse the Company's non-derivative financial liabilities into relevant maturity group based on their
contractual maturities:
Note - 36: Capital Management
The Company's objective for capital management is to maximize shareholder wealth, safeguard business continuity and
support the growth of the Company. The Company determines the capital management requirement based on annual
operating plans and long-term and other strategic investment plans. The funding requirements are met through optimum
mix of borrowed and own funds.
(C) Market risk
(i) Foreign currency risk
Foreign currency risk means the risk that the result or economic situation of the Company changes due to changes
in exchange rates. The Company is exposed to foreign exchange risk arising from foreign currency transactions,
primarily with respect to the USD. Foreign exchange risk arises from future commercial transactions and recognised
assets and liabilities denominated in a currency which is not the Company's functional currency (h). The risk is
measured through a forecast of highly probably foreign currency cash flows.
Note - 37: Segment Reporting
The business activities of the Company from which it earns revenues and incurs expenses; whose operating results are
regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment
and assess its performance, and for which discrete financial information is available which involves predominantly one
operating segment i.e. automotive components.
Note - 40:
Company has purchased six bills of exchange and paid H206.65 Lakhs (H206.65 Lakhs) for the same. These bills have matured
but have not been honoured. Company has filed suits in the High Court of Judicature at Bombay.
Note - 41:
In terms of the Notification dated March 31, 2009 by The Ministry of Corporate Affairs amending the erstwhile Ind AS -21 "The
Effects of Changes in Foreign Exchange Rates”, the company had exercised the option to recognize the exchange difference on
long term non-monetary items retrospectively from the accounting period 2007-08. Such exchange differences relating to the
acquisition of capital assets are adjusted to the cost of capital and would be depreciated over the balance life of the asset.
Exchange difference amounting to H200.24 Lakhs (H373.90 Lakhs) has been carried in the Fixed Assets as on March 31, 2025.
Notes
i) Current Ratio has improved due to better efficiency, performance and increase in bank balance due to issue of convertible
warrants / equity shares.
ii) Debt- Equity Ratio improved on account of issue of equity shares and convertible warrants, repayment of terms loans and
improvement in profitably.
iii) Debt Service Coverage Ratio has impacted due to prepayment of term loans from banks.
iv) Return on Equity ratio and Return on Capital Employed ratio has gone down due to increase in equity.
v) Net Profit Ratio has improved because of increase in other income .
vi) Return on investment has goes down due to increase in investment in subsidiary.
Note - 45: Additional Regulatory Disclosures as per Schedule III of Companies Act, 2013
(i) The Title deeds of the immovable properties (other than properties where the Company is the lessee and the lease
agreements are duly executed in favour of the lessee) are held in the name of the Company.
(ii) The Company does not have any investment property.
(iii) There is no revaluation of Property, Plant and Equipment (including Right of Use Assets) and intangible assets during the
year, hence the revaluation related disclosures required as per Additional Regulatory Information of Schedule III (revised)
to the Companies Act, is not applicable.
(iv) The Company has not granted Loans or Advances in the nature of loan to any promoters, Directors, KMPs and the related
parties (As per Companies Act, 2013) , which are repayable on demand or without specifying any terms or period of
repayments.
Note - 45: Additional Regulatory Disclosures as per Schedule III of Companies Act, 2013 (Contd.)
(vi) Intangible assets under development :- NA
(vii) No proceedings have been initiated or pending against the Company for holding any Benami property under the Benami
Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.
(viii) The Company has been sanctioned facilities from banks on the basis of security of current assets in excess of H5 Cr. The
Quarterly returns or statements of current assets filed by the Company with such banks are in agreement with the books
of accounts of the Company taking into account notes given in the said statements.
(ix) The Company has not been declared as wilful defaulter by any of the lenders.
(x) There are no transactions with the Companies whose name are struck off under Section 248 of The Companies Act, 2013
or Section 560 of the Companies Act, 1956 during the year ended 31st March 2025
(xi) AH applicable cases where registration of charges or satisfaction is required to be filed with Registrar of Companies have
been filed. No registration or satisfaction is pending at the year ended 31st March 2025.
(xii) Compliance with number of layers of companies - NA
(xiii) No scheme of arrangement has been approved by the competent authority in terms of Section 230 to 237 of the
Companies Act, 2013.
(xiv) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign
entities (Intermediaries) with the understanding that the Intermediary shall: (a) directly or indirectly lend or invest in
other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries)
or (b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiary.
(xv) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with
the understanding (whether recorded in writing or otherwise) that the Company shall: (a) directly or indirectly lend or
invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate
Beneficiaries) or (b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(xvi) The Company has not operated in any crypto currency or Virtual Currency transactions.
(xvii) During the year the Company has not disclosed or surrendered, any income other than the income recoginsed in the
books of accounts in the tax assessments under Income Tax Act, 1961.
(xviii) Corporate Social Responsibility : Provisions of 135 of companies act 2013 are not applicable to company.
As per our report of even date For and on behalf of Board of Directors
For Pawan Jain And Associates For Kinetic Engineering Limited
Chartered Accountants
A. H. Firodia A. A Firodia
(Chairman) (Vice Chairman & Managing Director)
DIN:00057324 DIN:00332204
CA Pawan Jain
Partner
Membership Number- 032900
Firm Reg No.:0107867W Vinayak Shevade Chaitanya Mundra
Place: Pune (Chief Financial Officer) (Company Secretary)
Date: 13th May 2025
UDIN: 25032900BMILTH8598
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