i. Provisions and Contingent liabilities,
Contingent assets
(i) Provision: A provision is recognized when the Company
has a present obligation (legal or constructive) as a result
of 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. These estimates are
reviewed at each reporting date and adjusted to reflect
the current best estimates. If the effect of the time value
of money is material, provisions are discounted using a
current pretax 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 recognized as a finance cost.
(ii) Contingent liabilities: A contingent liability is a possible
obligation that arises from past events whose existence
will be confirmed by the occurrence or non-occurrence
of one or more uncertain future events beyond the
control of the Company or a present obligation that
is not recognized because it is not probable that an
outflow of resources will be required to settle the
obligation. A contingent liability also arises in extremely
rare cases, where there is a liability that cannot be
recognized because it cannot be measured reliably.
The Company does not recognize a contingent liability
but discloses its existence in the financial statements
unless the probability of outflow of resources is remote.
(iii) Contingent assets: Contingent assets are not
recognized. However, when the realization of income
is virtually certain, then the related asset is no longer
a contingent asset, but it is recognized as an asset.
Provisions, contingent liabilities, contingent assets and
commitments are reviewed at each balance sheet date.
j. Revenue
The Company follows Ind AS 115 “Revenue
from Contracts with Customers”. The Company
manufactures and sells in plywood and allied products,
medium density fibreboard and allied products.
Sales are recognised when control of the products
has transferred, being when the products are delivered
to the dealer, the dealer has full discretion over the
channel and price to sell the products, and there is
no unfulfilled obligation that could affect the dealer’s
acceptance of the products. Delivery occurs when the
products have been shipped to the specific location,
the risk of obsolescence and loss have been transferred
to the dealer, and either the dealer has accepted the
products in accordance with the sales contract, the
acceptance provisions have lapsed, or the Company
has objective evidence that all criteria for acceptance
have been satisfied.
The products are often sold with volume discounts
based on aggregate sales over a 12 months period,
cash discount on payment within specified period,
promotional gift on achieving specific targets, quality
claims if claims made in the specified period and
other promotional expenses such as tours and travel
packages to dealer, etc. Revenue from these sales
is recognised based on the price specified in the
contract, net of the estimated volume discounts, cash
discounts, quality claims and promotional expenses.
Accumulated experience is used to estimate and
provide for the discounts/claims/provisions, using the
expected value method, and revenue is only recognised
to the extent that it is highly probable that a significant
reversal will not occur. A refund liability is recognised
under 'Other Financial Liabilities' for expected volume
discount payables and cash discount payables to
dealers in relation to sale made until the end of reporting
period. Provision (included in other current liabilities) is
recognised for expected sales promotional expenses
against the sales made until the end of reporting period.
No element of financing is deemed present as the sales
are made with a credit term of 30-90 days, which is
consistent with market practice.
k. Government Grants
Grants from Government are recognised at their fair
value where there is reasonable assurance that the
grant will be received and the Company will comply with
the conditions attached thereto. Government grants
related to revenue are recognised in the Statement of
Profit and Loss on a systematic and rational basis in the
periods in which the Company recognises the related
costs for which the grants are intended to compensate
and are netted off with the related expenditure. If not
related to a specific expenditure, it is taken as income
and presented under "Other Income".
l. Leases
The Company’s leased assets primarily consist of leases
for office space. The Company assesses whether a
contract contains a lease, at inception of a contract.
A contract is, or contains, a lease if the contract conveys
the right to control the use of an identified asset for
a period in exchange for consideration. To assess
whether a contract conveys the right to control the use
of an identified asset, the Company assesses whether
(i) the contract involves the use of an identified asset
(ii) the Company has substantially all of the economic
benefits from use of the asset through the period of the
lease; and (iii) the Company has the right to direct the
use of the asset.
Right of use assets
At the date of commencement of the lease, the
Company recognizes a right-of-use asset (“ROU”) and
a corresponding lease liability for all lease arrangements
in which it is a lessee, except for leases with a term of
twelve months or less (short-term leases) and low value
leases. For these short-term and low-value leases,
the Company recognizes the lease payments as an
operating expense on a straight -line basis over the
term of the lease.
The right-of-use assets are initially recognized at cost,
which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the
commencement date of the lease plus any initial direct
costs less any lease incentives. They are subsequently
measured at cost less accumulated depreciation and
impairment losses. Right-of-use assets are depreciated
from the commencement date on a straight-line basis
over the shorter of the lease term and useful life of the
underlying asset unless the lease transfers ownership
of the underlying asset to the Company by the end
of the lease term or the cost of the right-of-use asset
reflect that the Company exercise a purchase option.
The Company applies Ind AS 36 to determine whether
a right-of-use asset is impaired and accounts for any
identified impairment loss as described in the accounting
policy below on “Impairment of non- financial assets”.
Lease liabilities
The lease liability is initially measured at amortized cost
at the present value of the future lease payments that
are not paid at the commencement date. The lease
payments are discounted using the interest rate implicit
in the lease or, if not readily determinable, using the
Company’s incremental borrowing rates. Lease liabilities
are remeasured with a corresponding adjustment to the
related right of use asset (or in profit or loss if the carrying
amount of the right-of-use asset has been reduced
to zero) if the Company changes its assessment of
whether it will exercise an extension or a termination
or a purchase option. The interest cost on lease liability
(computed using effective interest method), is expensed
in the statement of profit and loss. Lease liability and
right-of-use asset have been presented in the Financial
Statements and lease payments have been classified
as financing cash flows.
m. Recognition of interest income
Interest income is recognised using the effective
interest method. The ‘effective interest rate’ is the rate
that exactly discounts estimated future cash payments
or receipts through the expected life of the financial
instrument to the gross carrying amount of the financial
asset; or the amortised cost of the financial liability.
In calculating interest income, the effective interest
rate is applied to the gross carrying amount of the
asset (when the asset is not credit-impaired) or to the
amortised cost of the liability. However, for financial
assets that have become credit-impaired subsequent
to initial recognition, interest income is calculated by
applying the effective interest rate to the amortised
cost of the financial asset. If the asset is no longer
credit-impaired, then the calculation of interest income
reverts to the gross basis.
n. Income tax
Income tax expense comprises of current tax and
deferred tax. Current tax and deferred tax is recognised
in the Statement of Profit and Loss except to the extent
that it relates to a business combination, or items
recognised directly in equity or in OCI.
(i) Current tax
Current tax comprises the expected tax payable or
receivable on the taxable income or loss for the year
and any adjustment to the tax payable or receivable in
respect of previous years. The amount of current tax
reflects the best estimate of the tax amount expected
to be paid or received after considering the uncertainty,
if any, related to income taxes. It is measured using tax
rates (and tax laws) enacted or substantively enacted
by the reporting date. Current tax assets and current tax
liabilities are off set only if there is a legally enforceable
right to set off the recognised amounts, and it is
intended to realise the asset and settle the liability on a
net basis or simultaneously.
(ii) Deferred tax
Deferred tax is recognised in respect of temporary
differences between the carrying amounts of assets
and liabilities for financial reporting purposes and the
corresponding amounts used for taxation purposes
(tax base). Deferred tax is also recognised in respect of
carried forward tax losses and tax credits. Deferred tax
is not recognised for:
• temporary differences arising on the initial recognition
of assets or liabilities in a transaction that is not
a business combination and that affects neither
accounting nor taxable profit or loss at the time of
the transaction;
• temporary differences related to investments in
subsidiaries, associates and joint arrangements
to the extent that the Group is able to control the
timing of the reversal of the temporary differences
and it is probable that they will not reverse in the
foreseeable future;
Deferred tax assets are recognised to the extent that it
is probable that future taxable profits will be available
against which they can be used. The existence of
unused tax losses is strong evidence that future taxable
profit may not be available. Therefore, in case of a history
of recent losses, the Company recognises a deferred
tax asset only to the extent that it has sufficient taxable
temporary differences or there is convincing other
evidence that sufficient taxable profit will be available
against which such deferred tax asset can be realised.
Deferred tax assets - unrecognised or recognised, are
reviewed at each reporting date and are recognised/
reduced to the extent that it is probable/ no longer
probable respectively that the related tax benefit will
be realised. Deferred tax is measured at the tax rates
that are expected to apply to the period when the asset
is realised or the liability is settled, based on the laws
that have been enacted or substantively enacted by the
reporting date.
The measurement of deferred tax reflects the tax
consequences that would follow from the manner in
which the Company expects, at the reporting date, to
recover or settle the carrying amount of its assets and
liabilities. Deferred tax assets and liabilities are offset if
there is a legally enforceable right to off set current tax
liabilities and assets, and they relate to income taxes
levied by the same tax authority on the same taxable
entity, or on different tax entities, but they intend to settle
current tax liabilities and assets on a net basis or their
tax assets and liabilities will be realised simultaneously.
o. Borrowing costs
Borrowing costs are interest and other costs (including
exchange differences relating to foreign currency
borrowings to the extent that they are regarded as an
adjustment to interest costs) incurred in connection
with the borrowing of funds. Borrowing costs directly
attributable to acquisition or construction of an asset
which necessarily take a substantial period of time to
get ready for their intended use are capitalised as part
of the cost of that asset. Other borrowing costs are
recognised as an expense in the period in which they
are incurred. Where there is an unrealised exchange
loss which is treated as an adjustment to interest and
subsequently there is a realised or unrealised gain in
respect of the settlement or translation of the same
borrowing, the gain to the extent of the loss previously
recognised as an adjustment is recognised as an
adjustment to interest.
p. Cash and cash equivalents
Cash and cash equivalents include cash and cash-on-
deposit with banks. The Company considers all highly
liquid investments with a remaining maturity at the
date of purchase of three months or less and that are
readily convertible to known amounts of cash to be
cash equivalents.
q. Earnings per share
Basic earnings per share is calculated by dividing the
net profit or loss for the period attributable to equity
shareholders by the weighted average number of
equity shares outstanding during the period. For the
purpose of calculating diluted earnings per share, the
net profit or loss for the period attributable to equity
shareholders and the weighted average number of
shares outstanding during the period are adjusted for
the effects of all dilutive potential equity shares.
r. Operating segment
An operating segment is a component of the Company
that engages in business activities from which it may
earn revenues and incur expenses, including revenues
and expenses that relate to transactions with any of
the Company’s other components, and for which
discrete financial information is available. All operating
segments’ operating results are reviewed regularly by
the Chief Operating Decision Maker (CODM) to make
decisions about resources to be allocated to the
segments and assess their performance. The CODM
consists of the Executive Chairman, Managing Director
& CEO and Chief Financial Officer. The Company
has currently two reportable segments namely:
i) Plywood and allied products, ii) Medium density
fibreboards and allied products.
s. Determination of fair values
Fair values have been determined for measurement
and disclosure purposes based on the following
methods. Where applicable, further information about
the assumptions made in determining fair values is
disclosed in the notes specific to that asset or liability.
(i) Non-derivative financial assets
Non-derivative financial assets are initially measured
at fair value. If the financial asset is not subsequently
accounted for at fair value through profit or loss, then
the initial measurement includes directly attributable
transaction costs. These are measured at amortised
cost or at FVTPL. Investments in quoted equity
instruments are measured at FVTPL.
(ii) Trade and other receivables
The fair values of trade and other receivables are
estimated at the present value of future cash flows,
discounted at the market rate of interest at the
measurement date. Short-term receivables with no
stated interest rate are measured at the original invoice
amount if the effect of discounting is immaterial.
Fair value is determined at initial recognition and, for
disclosure purposes, at each annual reporting date.
(iii) Derivative financial liabilities
The Company uses derivative financial instruments,
such as forward currency contracts and interest rate
swaps to hedge its foreign currency risks and interest
rate risks. Such derivative financial instruments are
initially recognised at fair value on the date on which a
derivative contract is entered into and are subsequently
re-measured at fair value.
(iv) Other non-derivative financial liabilities
Other non-derivative financial liabilities are measured
at fair value, at initial recognition and for disclosure
purposes, at each annual reporting date. Fair value is
calculated based on the present value of future principal
and interest cash flows, discounted at the market rate
of interest at the measurement date.
t. Recent accounting pronouncements
MCA has notified amendments to Ind AS 1 (classification
of liabilities and disclosure of material accounting
policies) and amendments to Ind AS 7 and Ind AS 107
(disclosures relating to supplier finance arrangements).
The Company has evaluated these amendments and
has no impact on the recognition and measurement of
assets and liabilities in the financial statements.
u. Standards notified but not yet effected
Ministry of Corporate Affairs (“MCA”) notifies new
standards or amendments to the existing standards
under Companies (Indian Accounting Standards) Rules
as issued from time to time.
a. Ind AS 118 - Presentation and Disclosure in
Financial Statements, which will replace Ind AS
1 and is effective for annual reporting periods
beginning on or after April 1, 2027. Ind AS 118
introduces revised presentation requirements in
the statement of profit and loss and enhanced
disclosure requirements.
b. Amendments to Ind AS 1 - For annual reporting
periods beginning on or after 1 April 2026, any
breach of a covenant—whether material or
immaterial-occurring on or before the reporting
date will, in accordance with Ind AS 1, require the
related liability to be classified as current, unless
the lender has granted a waiver of the breach
on or before the reporting date and has agreed
not to demand repayment for at least 12 months
after the reporting date as a consequence of
the breach. Such a waiver shall be treated as an
adjusting event.
*The Company had earlier decided, based on a legal opinion, to defer the recognition of subsidies availed for the establishment
of manufacturing plant at Chittoor, Andhra Pradesh. In view of this the Company had not recognized the following subsidy
from October 2021 to March 2025 (being the closing period for subsidies entitlement); Power subsidy (Not approved)
'1,937.63 lakhs, Power subsidy (approved) '849.91 lakhs, Green measure subsidy (approved) ' 5,000lakhs, Land
conversion and stamp duty subsidy (approved) '368.02 lakhs, aggregating to '8,155.56 lakhs. During the year ended
31 March 2026, the Company has received an amount of '1,932.52 lakhs towards total approved subsidies. Based on the
partial receipt and therefore reasonable assurance, the Company has now recognized the balance approved subsidies of
'6,217.93 lakhs, viz.
a) Power subsidy '849.91 lakhs as 'Other Operating Revenue' under 'Revenue from Operations' (refer note 24),
b) Green measures subsidy '5,000 lakhs, Land conversion and stamp duty subsidy '368.02 lakhs, aggregating to
'5,368.02 lakhs, as adjustments from Freehold land, Buildings, Plant and Equipments. (refer note 4).
Details of security
(a) Term loan from Landesbank Baden-Wurttenberg (LBBW) of '2,818.44 lakhs (31 March 2025: ' 5,411.53 lakhs) is
secured by first ranking priority hypothecation charge on main press line of MDF plant and other machinery at Chittoor,
Andhra Pradesh financed by Landesbank Baden-Wurttenberg (refer note 4).
(b) Term loan from Landesbank Baden-Wurttenberg (LBBW) of '28,794 lakhs (31 March 2025: ' 27,203.41 lakhs) is secured
by first ranking priority hypothecation charge on main press line of MDF plant under brownfield expansion at Chittoor,
Andhra Pradesh along with other movable fixed assets financed by Landesbank Baden-Wurttenberg (refer note 4)
(c) Term loan from CITI Bank N.A. of '4,952.38 lakhs (31 March 2025: ' 8,000 lakhs) is secured by first charge on
movable fixed assets of the company at Chittoor, Andhra Pradesh (except assets exclusively charged to Landesbank
Baden-Wurttenberg), and second pari passu charge on all current assets of the Company
(d) Working capital loans of 'Nil (31 March 2025: ' Nil) are secured by first pari passu charge on all current assets of the
Company, and second pari passu charge on all movable fixed assets of the Company except assets exclusively charged
to Landesbank Baden-Wurttenberg.
(a) Defined contribution plan: Employee benefits in the form of provident fund is considered as defined contribution plan
and the contributions to Employees’ Provident Fund Organisation established under The Employees' Provident Fund and
Miscellaneous Provisions Act 1952 is charged to the Statement of Profit and Loss of the year when the contributions to
the respective funds are due.
(b) Defined benefit plan: Retirement benefits in the form of gratuity is considered as defined benefit obligations and is
provided for on the basis of third party actuarial valuation, using the projected unit credit method, as at the date of the
Balance Sheet. Every Employee who has completed five years or more of service is entitled to gratuity on terms not less
favourable than the provisions of The Payment of Gratuity Act, 1972.
(c) Salaries, wages, bonus, etc. includes '1,066.07 lakhs (31 March 2025'944.79 lakhs) relating to outsource manpower cost.
(d) Amount incurred as expense for defined contribution to Provident Fund is '859.20 lakhs (31 March 2025'800.81 lakhs)
f) The Government of India has consolidated 29 existing labour legislations into a unified framework comprising four labour
codes viz the Code on Wages, 2019, the Code on Social Security, 2020, the Industrial Relations Code, 2020, and the
Occupational Safety, Health and Working Conditions Code, 2020 (collectively referred to as the "Codes"). The Codes
have been made effective from November 21, 2025. The Ministry of Labour & Employment published draft Central
Rules and FAQs to enable assessment of the financial impact due to changes in regulations. The incremental impact
of these changes has been assessed by the Company and has been recognised in the financial statements of the
Company for the year ended 31 March 2026, which is consistent with the guidance provided by the Institute of Chartered
Accountants of India.
c) Claim against the Company not acknowledged as debt: Cash outflows for the above are determinable only on
receipt of judgments pending at various forums/ authorities. The Company has reviewed all its pending litigations 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 position.
d) Income tax search proceedings: The Income Tax Department has conducted search proceedings at the Registered
office, other offices, plant locations of the Company as well as at the residence of the Promoter and an ex-employee of the
Company. The search commenced on 26 February 2026 and concluded on 2 March 2026, at the registered office of the
Company. The Company extended full cooperation during the course of the search and furnished all requisite information,
explanations, and documents as requested. As at the date of approval of these financial statements, the Company has
not received any written communication from the Department regarding the outcome of the said search proceedings.
Accordingly, the potential financial impact, if any, cannot presently be determined. Based on its assessment of the facts
and circumstances currently available, the Management believes that no material adjustments are required to the financial
statements for the year ended 31 March 2026 and that there is no material adverse impact on the financial position of the
Company in this regard.
e) GST search proceedings: The Directorate General of GST Intelligence (DGGI), Meerut Zonal unit had conducted search
proceedings at the Company's registered office, Rudrapur manufacturing plant and Company's guest house in Delhi on
29 July 2025 and 30 July 2025. The Company has deposited an amount of '479.82 lakhs against GST liability for
the period from FY 2019-20 to FY 2024-25 on voluntary basis on account of disallowance of ineligible input tax credit,
along with interest and penalty. The said amount has been recorded as '343.40 lakhs under 'Other Expenses' and
'136.42 lakhs under 'Finance Costs' in the financial statements for the year ended 31 March 2026.
g) Terms and conditions of transactions with related parties
Sales and purchases to/from related parties are made in the ordinary course of business and on terms equivalent
to those that prevail in arm’s length transactions with other vendors. Outstanding balances at the year-end are
unsecured and will be settled in cash and cash equivalents. The Company has not recorded any impairment of
receivables relating to amounts owed by related parties.
38. Fair value measurement
The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a
current transaction between willing parties, other than in forced or liquidation sale. The Company has established the following
fair value hierarchy that categories the value into 3 levels. The inputs to valuation techniques used to measure fair value of
financial instruments are:
Level 1: The hierarchy uses quoted prices in active markets for identical assets or liabilities.
Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques
which maximise the use of observable market data and rely lesser on company specific estimates. If all significant inputs
required to fair value an instrument are observable, the instrument is included in Level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3.
The management assessed that trade receivables, cash and cash equivalent, other bank balances, trade payable, cash
credits, borrowings and other financial assets and liabilities approximate their carrying amounts largely due to the short term
maturities of these instruments. The fair value of forward foreign exchange contracts is calculated as the mark to market value
determined based on report obtained from bankers.
Note: For fair value hierarchy between financial assets and financial liabilities, refer note 37.
39. Financial risk management
The Company has exposure to the following risks arising from financial instruments (i) Credit risk, (ii) Liquidity risk, (iii) Market risk
Risk management framework
The Company's principal financial liabilities, other than derivatives, comprises of borrowings, trade and other payables.
The main purpose of these financial liabilities is to finance the Company operations. The Company's principal financial assets,
other than derivatives include trade and other receivables, investments and cash and cash equivalents that derive directly from
its operations.
The Company’s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company’s
primary risk management focus is to minimise potential adverse effects of market risk on its financial performance. The Company
uses derivative financial instruments to mitigate foreign exchange related risk exposures. Foreign currency forward contract
are entered to hedge certain foreign currency risk exposures. The Company's exposure to credit risk is influenced mainly by
the individual characteristic of each customer and the concentration of risk from the top few customers. The Company’s risk
management assessment and policies and processes are established to identify and analyse the risks faced by the Company,
to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and
management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities.
(i) Credit risk
Credit risk is the risk of financial loss of the Company if a customer or counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the Company receivables from customers and loans. The Company is
exposed to credit risk from its operating activities (primarily trade receivables) and from its financing/investing activities, including
deposits with bank, foreign exchange transactions and financial guarantees. The Company has no significant concentration of
credit risk with any counterparty. The carrying amount of financial assets represent the maximum credit risk exposure.
Trade receivable
The management has established a credit policy under which each new customer is analysed individually for creditworthiness
before the Company's standard payment and delivery terms and conditions are offered. The Company's review includes
external ratings, if they are available, financial statements, credit agency information, industry information and in some cases
bank references.
Exposure to credit risks
The Company's exposure to credit risk is influenced mainly by the individual characteristics of each customer.
However management also considers the factors that may influence the credit risk of its customer base, including the default
risk associated with the industry. Details of concentration percentage of revenue generated from top customer and top five
customers are stated below:
The ageing analysis of the trade receivables has been considered from final due date of the invoice and the schedule is
annexed to note on Trade Receivables in note 11.
(ii) Liquidity risk
Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable
price. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability
of funding through an adequate amount of credit facilities to meet obligations when due. The Company's finance team is
responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks
are overseen by senior management. Management monitors the Company's liquidity position through rolling forecasts on
the basis of expected cash flows. The Company's approach to managing liquidity is to ensure, as far as possible, that it will
have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring
unacceptable losses or risking damage to the Company's reputation.
Exposure to liquidity risk
The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based
on contractual undiscounted payments.
(iii) Market risk
Market risk is the risk of loss of future earnings, fair value or future cash flows that may result from a change in the price of a
financial instrument . The value of a financial instrument may change as a result of changes in the interest rates, foreign currency
exchange rates, commodity prices, equity prices and other market changes that effect market risk sensitive instruments.
Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency
receivables, payables and borrowings. The Company uses derivatives to manage market risks. All such transactions are
carried out within the guidelines set by the management.
(a) Currency risk
Foreign currency risk is the risk impact related to fair value or future cash flows of an exposure in foreign currency, which
fluctuate due to changes in foreign exchange rates. The Company's exposure to the risk of changes in foreign exchange rates
relates primarily to the foreign currency borrowings, import of raw materials and spare parts, capital expenditure, exports of
finished goods. The Company evaluates exchange rate exposure arising from foreign currency transactions. The Company
follows established risk management policies and standard operating procedures. It uses derivative instruments like foreign
currency forwards to hedge exposure to foreign currency risk.
(b) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in
market interest rates. The Company exposure to the risk of changes in market interest rates related primarily to the borrowings
with floating interest rates. The Company constantly monitors the credit markets and rebalances its financing strategies to
achieve an optimal maturity profile and financing cost.
40. Capital management
The Company’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. The management monitors the return on capital, as well as the level of dividends
to equity shareholders. The Company’s objective when managing capital are to: (a) to maximise shareholders value and provide
benefits to other stakeholders and (b) maintain an optimal capital structure to reduce the cost of capital. For the purpose of
the Company’s capital management, capital includes issued equity share capital and other equity reserves attributable to
the equity holders. The Company monitors capital using debt-equity ratio, which is total debt less liquid investments divided
by total equity.
41. Operating segments
An operating segment is a component of the Company that engages in business activities from which it may earn revenues
and incur expenses. All operating segment results are reviewed regularly by the Company's chief operating decision maker
(CODM) to make decisions about resources to be allocated to the segments and assess their performance. The Company has
two reportable segments i.e. (a) Plywood and (b) Medium Density Fibre (MDF) Boards and allied products.
Note: The difference in inventory and trade receivables is due to the amount included in financial statements on account
of sales not considered for the risk and rewards not transferred in view of compliance of Ind AS 115 and advances from
customers being netted off in bank returns. The discrepancy in trade payables is due to the service and the corporate creditors
not being part of disclosure in bank reporting. Creditors reported in stock statement is only to the extent of inventory purchased
net of advances.
44. Dividend paid: Proposed dividends on equity shares are subject to approval at the annual general meeting and are not
recognised as a liability as at 31 March 2026. The Company has proposed a final dividend of '0.50/- per equity share for
the year ended 31 March 2026. Since no dividend had been proposed in the previous year, financial figures with respect
to the same has not been given. The Company has paid an interim dividend of '0.30/- per equity share for the year
ended 31 March 2025.
45. Data Access and Audit Trail: MCA required the Companies to maintain the back-up of the books of account and other
relevant books and papers in electronic mode that should be accessible in India at all the time. The Companies are also
required to create back-up of accounts on servers physically located in India on a daily basis. The books of account along
with other relevant records and papers of the Company are maintained in electronic mode. These are readily accessible
in India at all times and a back-up is maintained in servers situated in India and the Company and its officers have full
access to the data in the servers.
The Company has evaluated the requirements under Rule 3(1) of the Companies (Accounts) Rules, 2014, as amended,
regarding the maintenance of books of account in accounting software that has the feature of recording an audit trail
(edit log). Accordingly, the Company has SAP (SAP SOH EHP 7) as the accounting software used for the creation and
maintenance of its books of account. The audit trail (edit log) feature including the system-level database logs in the said
software are enabled and remained operational throughout the financial year for all relevant transactions. Based on the
Company’s internal assessment, there has been no instance of the audit trail feature being tampered with during the year.
46. The Nomination and Remuneration Committee and the Board of Directors, at their respective meetings held on 15
May 2026, have approved the payment of remuneration of '5 lakhs to each of the Independent Directors for the financial
year 2025-26, in accordance with the provisions of Schedule V and other applicable provisions of the Companies Act,
2013. The payment of the aforesaid remuneration is subject to the approval of the shareholders at the ensuing Annual
General Meeting of the Company.
47. Significant Events after the Reporting Period: There were no significant adjusting events that occurred subsequent
to the reporting period other than the events disclosed in the relevant notes
48. Other Information:
i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the
Company for holding any Benami property.
(ii) The Company does not have any transactions with companies struck off.
(iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period,
(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
(v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities
(Intermediaries) with the understanding that the Intermediary shall: (a) directly or indirectly lend or invest in other persons
or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or (b) provide any
guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
(vi) 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,
(vii) The Company does not have any such transaction which is not recorded in the books of accounts that has been
surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.
(viii) There is no amount due and outstanding to be credited to Investor Education and Protection Fund as at 31 March 2026.
(ix) The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous
financial year.
(x) The Company is in compliance with the number of layers prescribed under clause (87) of Section 2 of the Companies Act
read with the Companies (Restriction on number of Layers) Rules, 2017.
(xi) The Company has not been declared a wilful defaulter by any bank or financial institution or other lender (as defined under
the Companies Act, 2013) or consortium thereof, in accordance with the guidelines on wilful defaulters issued by the
Reserve Bank of India.
(xii) The figures for the corresponding previous year have been regrouped / reclassified wherever necessary, to make
them comparable.
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