4.3 Of these 444,600,000 (31.03.2023: 444,600,000) equity shares have been pledged with SBICAP Trustee Company Limited (Security trustee) on behalf of consortium of working capital lenders.

The carrying value of investment in 'NCCIHL' as at March 31, 2024 is higher by ' 269.73 crores (31.03.2023: ' 185.66 crores) as compared to the Company's share of net worth in NCCIHL. Based on the internal assessment and legal advice, Management is of the view that the carrying value is recoverable, considering the future cash flows which include claims filed by NCCIHL and other underlying assets.

During the current year, the Company has purchased 263,613,095 shares of NCC Infra Holdings Limited ("IHL") from its existing shareholder for a consideration of ' 240.24 crores based on an earlier understanding. The latter has assigned its receivable of ' 240.24 crores to NCCIHL against its liability towards NCCIHL. NCC has paid an amount ' 90.00 crores and the balance of ' 150.24 crores is shown under 'Other Financial Liabilities'.

4.4 Of these 123,460,000 (31.03.2023: 100,000,000) equity shares have been pledged with SBICAP Trustee Company Limited (Security trustee) on behalf of consortium of working capital lenders.

During the current year, NCC Urban Infrastructure Limited had bought back 8,889,600 shares held by NCC, with face value of ' 10 at ' 27 after obtaining requisite approvals from its board of directors. The resultant gain of ' 13.33 crores has been shown under 'Exceptional Item'.

4.5 The Company has not traded or invested in Crypto currency or Virtual Currency in the current year (31.03.2023: ' Nil).

10.1 Trade receivables are generally realisable from customers within a period of 30 days from the date of submission of bill / invoice.

10.2 In determining the allowance for trade receivables the company has used practical expedients based on financial condition of the customer, ageing of the customer receivables and overdues, availability of collaterals and historical experience of collections from customers. The concentration of risk with respect to trade receivables is reasonably low as most of the customers are Government organisations though there may be normal delays in collections.

16.3 Unclaimed equity shares of 23,954 (31.03.2023: 25,454) are held in "NCC Limited - Unclaimed suspense account " in trust.

16.4 Rights of the share holders

The equity shares of the company having par value of ' 2 per share, rank pari passu in all respects including voting rights and entitlement to dividend. Repayment of the capital in the event of winding up of the Company will inter alia be subject to the provisions of Companies Act 2013, the Articles of Association of the Company and as may be determined by the Company in General Meeting prior to such winding up.

16.5 The Company had issued and allotted 18,000,000 Convertible Warrants on February 12, 2021 at a price of ' 59.00 per Warrant on preferential basis to the specified Promoters / Promoter Group of the Company, as per the provision the SEBI (ICDR) Regulations on receipt of 25% of total consideration amounting to ' 26.55 crores. As per the terms of the issue, the Convertible Warrants were converted into equivalent number of equity shares of ' 2.00 each on payment of the balance 75% of the consideration amounting to ' 79.65 crores in previous year. The alloted equity shares are listed and traded on both BSE Limited and National Stock Exchange of India Ltd.

17.4.a For the year ended March 31, 2024, the Board of Directors have proposed a dividend of ' 2.20 per share. The dividend payable on approval of the shareholders is ' 138.15 crores.

17.6 Nature of Reserves17.6. a Securities premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

17.6. b Capital Reserve

Capital Reserve represents reserve balances which are not available for distribution as dividend to the Company.

17.6. c General reserve

The Company created a General Reserve in earlier years pursuant to the provisions of the Companies Act, 1956 where in certain percentage of profits were required to be transferred to General Reserve before declaring dividends. As per Companies Act, 2013 the requirements to transfer profits to General Reserve is not mandatory. General Reserve is a free reserve available to the Company.

17.6. d Retained Earnings

Retained earnings are the profits/(loss) that the Group has earned/incurred till date, less any transfers to general reserve, dividends or other distributions paid to shareholders.

18.1 Term Loans from Banks:

(i) Kotak Mahindra Bank, Indus Ind Bank, YES Bank and Karnataka Bank

- Secured by hypothecation of specific assets purchased out of the loan

(ii) Bank of Bahrain & Kuwait

- Exclusive charge on the entire equipment and machinery purchased out of the loan facility with a cover of minimum 1.15 times to be maintained throughout the tenor of the loan.

20.1 In accordance with the Payment of Gratuity Act, 1972 the company provides for gratuity covering eligible employees. The liability on account of gratuity is covered partially through a recognized Gratuity Fund managed by Life Insurance Corporation of India (LIC) and balance is provided on the basis of valuation of the liability by an independent actuary as at the year end. The management understands that LIC overall portfolio of assets is well diversified and as such, the long term return on the policy is expected to be higher than the rate of return on Central Government bonds.

A Defined benefit plans

(i) Liability for gratuity as on March 31, 2024 is ' 93.82 crores (31.03.2023: ' 81.26 crores) of which ' 2.96 crores (31.03.2023: ' 2.80 crores) is funded with the Life Insurance Corporation of India. The balance of ' 90.86 crores (31.03.2023: ' 78.46 crores) is included in Provision for Gratuity.

(ii) Details of the Company's post-retirement gratuity plans for its employees including whole-time directors are given below, which is certified by the actuary.

21.1 Working Capital Demand Loans and Cash Credit facilities availed from consortium of banks are secured by:

a) Hypothecation against first charge on stocks, book debts and other current assets of the Company, (excluding specific projects) both present and future, ranking pari passu amongst consortium banks.

b) Collateral Security pari passu first charge (Hypothecation / Pledge) amongst the members of consortium on unencumbered movable fixed assets of the Company at WDV (specific assets) and Shares of NCC Infrastructure Holdings Limited (Refer note 4.3) and NCC Urban Infrastructure Limited (Refer note 4.4).

c) Equitable mortgage of sixteen properties (Land & Buildings).

d) Personal Guarantee of Sri. A A V Ranga Raju, Sri A G K Raju & Sri A S N Raju.

These facilities carry an interest rate of 8.00% to 11.50% per annum.

21.2 The Company used the borrowings from banks and financial institutions for the specific purpose for which it was taken.

21.3 The Company has borrowings from banks on the basis of security of current assets, and the quarterly returns and statements

of current assets filed by the Company with banks are in agreement with the books of accounts.

21.4 The Company is not declared as a willful defaulter by any bank or financial Institution or other lender during the financial year.

30.1 Defined contribution plans

The Company made Provident Fund and Superannuation Fund contributions to defined contribution plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised ' 23.98 crores (31.03.2023: ' 20.94 crores) for Provident Fund contributions and ' 13.51 crores (31.03.2023: ' 11.16 crores) for Superannuation Fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

33.3 The Company does not have any transaction which is not recorded in the books of accounts that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.

The Company has filed claims and has also filed counter claims in several legal disputes related to construction contracts and same are pending before legal authorities. The Management does not expect any material adverse effect on its financial position.

36 Segment Reporting:

In accordance with Ind AS 108 "Operating Segments", segment information has been given in the consolidated financial statements of NCC Limited and therefore no separate disclosure on segment information is given in these financial statements.

Customer Concentration

Revenue from one customer amounted to ' 5,983.54 crores (March 31, 2023: ' 2,411.90 crores), arising from income from contracts and services.

38 Financial instruments:38.1 Capital management

The Company's capital management objective is to maximise the total shareholder return by optimising cost of capital through flexible capital structure that supports growth. Further, the Company ensures optimal credit risk profile to maintain / enhance credit rating.

The Company determines the amount of capital required on the basis of annual operating plan and long-term strategic plans. The funding requirements are met through internal accruals and long-term/short-term borrowings. The Company monitors the capital structure on the basis of Net debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

For the purpose of capital management, capital includes issued equity capital, securities premium and all other revenue reserves. Net debt includes all long and short-term borrowings as reduced by cash and cash equivalents.

38.3 Financial risk management objectives

The Company's business activities exposed to a variety of financial risk viz., market risk, credit risk and liquidity risk. The Company's focus is to estimate a vulnerability of financial risk and to address the issue to minimize the potential adverse effects of its financial performance.

i) Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The Company's exposure to market risk is primarily on account of the following:

• Interest rate risk

Out of total borrowings, large portion represents short term borrowings (WCDL) and the interest rate primarily basing on the Company's credit rating and also the changes in the financial market. Company continuously monitoring over all factors influence rating and also factors which influential the determination of the interest rates by the banks to minimize the interest rate risks.

The Company's exposure to changes in interest rates relates primarily to the Company's outstanding floating rate borrowings. Out of the total borrowings of ' 1,005.03 crores (31.03.2023: ' 979.57 crores) as of 31.03.2024, the floating rate borrowings are ' 904.03 crores (31.03.2023: ' 878.07 crores). For every 50 base points change in the interest rate when no change in other variables, it will affect the profit before tax by ' 4.52 crores for the year ended March 31, 2024 (31.03.2023:? 4.39 crores).

• Foreign currency risk

The Company has several balances in foreign currency and consequently the Company is exposed to foreign exchange risk. The exchange rate between the rupee and foreign currencies has changed substantially in recent years, which has affected the results of the Company, and may fluctuate substantially in the future. The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established risk management policies.

We summarize below the financial instruments which have the foreign currency risks as at March 31,2024 and March 31, 2023.

The Company doesn't have any forex derivative instrument, hence all the above balances are unhedged.

(b) Foreign currency sensitivity analysis:

The Company is not substantially exposed for business activities in foreign currency except in the form of investments and loans into its foreign subsidiaries and associates. Hence, the impact of any significant fluctuation in the exchange rates is not expected to have a material impact of the operating profits of the Company.

The Company's exposure to foreign currency changes for all other currencies is not material.

ii) Credit risk management

a) Credit risk on trade receivables and contract assets is limited as the customers of the Company mainly consists of the Government promoted entities having a strong credit worthiness. As a practical expedient, the Company uses a provision matrix to determine impairment loss of its trade receivables and unbilled revenue. The provision matrix is based on its historically observed default rates over the expected life of the trade receivable and unbilled revenue. Accordingly, the Company creates provision of 1.50% to 2.00% of the closing receivables and 1.50% to 3.50% of the closing unbilled revenue. Refer note 6, 10, 15 and 15.1 for provision made against trade receivable and unbilled revenue.

b) Pursuant to a settlement agreement entered by NCC Infrastructure Holdings Limited, a subsidiary, the Company has guaranteed the payment to be made by the subsidiary amounting to ' 175.00 crores, of which ' 85.00 crores is paid during the current year. The Company does not expect any payment to be made under this guarantee.

iii) Liquidity risk management

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuous planning and monitoring of actual cash flows and by matching the maturity profiles of financial assets and liabilities.

iv) Commodity price risk management

A major portion of the Company's costs for execution includes procurement of various equipment and materials which may have direct or indirect linkages to commodity prices like steel, cement etc. Accordingly, the Company is exposed to the price risk on these commodities. To mitigate the risk of commodity prices, the Company relies on contractual provisions like price variation provisions. The residual risk carried by the Company is not material.

38.4 Fair value measurements:

Some of the Company's financial assets and financial liabilities are measured at fair value at the end of the reporting period. The following table gives information about how the fair values of these financial assets and financial liabilities are determined (in particular, the valuation techniques and inputs used):

40 The exceptional items for the year ended March 31,2024 is ' 56.55 crores (March 31,2023 is ' Nil), pertains to provision made for impairment of investment in one of the subsidiaries mainly due to its settlement of litigations / claims and profit on account of buyback of shares by a subsidiary.

41 During the current year, the Company has received an arbitration award with respect to the dispute with a customer (Sembcorp Energy India Limited), wherein the Company was awarded a net amount of ' 197.85 crores as payable to it against ' 606.23 crores outstanding in books of account. Of the net amount awarded, the Company has received ' 153.72 crores and has charged-off the balance amount of ' 351.34 crores (net of provisions) under Revenue from operations as variable consideration for year ended March 31, 2024. NCC and customer have challenged the award with respect to claims rejected including liquidated damages / retention money and arbitration costs/ interest, respectively. Based on management assessment and legal advice, the Company believes that there will be no significant financial impact on account of the same.

43 Amounts included in contract liabilities at the beginning of the year recognised as revenue in the current year of ' 1,860.92 crores (31.03.2023: ' 859.94 crores).

Change in the contract assets and contract liabilities as at March 31, 2024 from March 31, 2023 is on account of increase in operations of the Company.

44 Reconciling the amount of revenue recognised in the statement of profit and loss with the contracted price:

During the current year, the revenue from contracts with customer includes net revenue recognised for performance obligations fulfilled in the previous year of ' (199.39 crores) (March 31, 2023: ' 154.69 crores).

45 Performance obligation:

The transaction price allocated to the remaining performance obligations (excluding non-moving orders) is ' 51,843.00 crores (31.03.2023: ' 45,847.00 crores), which will be recognised as revenue over the respective project durations. Generally the project duration of contracts with customers is ranging 1 to 3 years.

46 The trade receivables and contract assets includes an amount of ' 112.96 crores (31.03.2023: ' 122.33 crores)(net of mobilisation advance) relating to Amaravati Capital City projects in Andhra Pradesh. Execution of the work / payment in these projects has been slow since May, 2019. Management based on internal assessments and discussions with agencies is confident of recovering these balances.

47 The Company has migrated to a new accounting software from legacy accounting software during the year. Both accounting software used for maintaining its books of account have a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software, except that audit trail feature in respect of the new accounting software is not enabled for certain changes made using access rights and/or the underlying SQL database. The Company has obtained relevant SOC reports from service organisation related to new accounting software and these reports do not highlight any other exception for the control objectives in scope of the reports. Further, there are no instance of audit trail feature being tampered with in respect of the accounting software.

b) The Company has not received any fund from any persons or entities, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

50 No transactions made with the Struck off Companies in the current year (31.03.2023: ' Nil).

51 No charges are pending for registration with Registrar of Companies (ROC) beyond the statutory period except for certain cases where the company is yet to receive No Objection Certificate (NOC) from the lenders.