1. We have audited the accompanying standalone financial
statements of Ester Industries Limited (‘the Company'),
which comprise the Standalone Balance Sheet as at 31
March 2025, the Standalone Statement of Profit and
Loss (including Other Comprehensive Income), the
Standalone Statement of Cash Flow and the Standalone
Statement of Changes in Equity for the year then ended,
and notes to the standalone financial statements,
including material accounting policy information and
other explanatory information.
2. In our opinion and to the best of our information and
according to the explanations given to us, the aforesaid
standalone financial statements give the information
required by the Companies Act, 2013 (‘the Act') in the
manner so required and give a true and fair view in
conformity with the Indian Accounting Standards (‘Ind
AS') specified under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules, 2015
and other accounting principles generally accepted in
India, of the state of affairs of the Company as at 31
March 2025, and its profit (including other
comprehensive income), its cash flows and the changes in
equity for the year ended on that date.
Basis for Opinion
3. We conducted our audit in accordance with the
Standards on Auditing specified under section 143(10)
of the Act. Our responsibilities under those standards
are further described in the Auditor's Responsibilities for
the Audit of the Standalone Financial Statements
section of our report. We are independent of the
Company in accordance with the Code of Ethics issued
by the Institute of Chartered Accountants of India (‘ICAI')
together with the ethical requirements that are relevant
to our audit of the standalone financial statements
under the provisions of the Act and the rules thereunder,
and we have fulfilled our other ethical responsibilities in
accordance with these requirements and the Code of
Ethics. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis
for our opinion.
Key Audit Matters
4. Key audit matters are those matters that, in our
professional judgment, were of most significance in our
audit of the standalone financial statements of the
current period. These matters were addressed in the
context of our audit of the standalone financial
statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on
these matters.
5. We have determined the matters described below to be the key audit matters to be communicated in our report.
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Key audit matter
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How our audit addressed the key audit matter
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Revenue recognition - Sale of products
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Our audit procedures included, but were not limited, to the
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Refer Note 4.5.1 and Note 25 to the accompanying
standalone financial statements for the material
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following:
• Obtained an understanding of the process of
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accounting policy on revenue recognition and details of
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identification and recording of revenue transactions
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revenue recognized during the year in accordance with the
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and assessed the appropriateness of the Company's
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requirements of Ind AS 115, Revenue from Contracts with
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revenue recognition accounting policies in accordance
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Customers (‘Ind AS 115').
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with Ind AS 115;
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Revenue of the Company majorly comprises of revenue
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• Evaluated the design, implementation and tested the
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from sale of polyester films and specialty polymers. The
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operating effectiveness of key controls over revenue
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Company sells its products through various distribution
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recognition;
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channels involving a high volume of sale transactions.
The Company recognises revenue at a point in time when
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• Performed substantive analytical procedures on
revenue which included ratio analysis, product mix
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the control of products being sold is transferred to the
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analysis, region wise analysis, etc;
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customer and there is no unfulfilled obligation. The
revenue is measured based on the transaction price
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• Evaluated on a sample basis, the terms and conditions
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specified in the contract, net of discounts and goods and
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of the contracts, including incoterms to assess the
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services tax.
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accuracy and completeness of revenue recognised
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Revenue recognition is determined to be an area involving
significant audit risk primarily as there is a risk that
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during the year in accordance with Ind AS 115;
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Key audit matter
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How our audit addressed the key audit matter
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revenue is recognised on sale of goods before the control
in the goods is transferred and hence, requires significant
auditor attention. Revenue is also a key performance
indicator of the Company and accordingly, testing
occurrence of revenue transactions is a key focus area for
our audit.
Considering the volume of sales transactions, materiality
of amount involved and significant attention required by
auditor as mentioned above, revenue recognition has been
considered as a key audit matter for the current year audit.
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• On a sample basis, tested revenue transactions recorded
during the year, and revenue transactions recorded
in the specific period before and after year-end, with
supporting documents such as invoices, agreements
with customers and proof of deliveries, to ensure that
the correct amount of revenue is recorded in the correct
period;
• Performed other substantive audit procedures including
obtaining debtor confirmations on a sample basis and
reconciling revenue recorded during the year with
statutory returns;
• Tested manual journal entries impacting revenue
including credit notes, claims etc., which were material
or irregular in nature with supporting documents and
evaluated business rationale thereof; and
• Assessed the adequacy and appropriateness of
disclosures made in the standalone financial statement
in accordance with the requirements of applicable
accounting standards.
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Key audit matter
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How our audit addressed the key audit matter
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Impairment assessment of investment in subsidiary
Refer Note 4.10 for the accounting policy and Note 7 for
disclosures of the accompanying standalone financial
statements
The Company has investment amounting to ^ 43,500 lacs
in Ester Filmtech limited, wholly owned subsidiary
(subsidiary'), which is 33.06 % of total assets as at 31
March 2025.
The subsidiary has incurred losses and the carrying value
of such investments exceed the net worth of the
subsidiary. Considering the existence of aforesaid
impairment indicators, the Company has performed
impairment assessment on carrying amount of the
investment in accordance with Ind AS 36, Impairment of
assets (‘Ind AS 36'), by estimating the recoverable value
with the involvement of a valuation expert engaged by the
management.
The recoverable value of the investment is determined
using discounted cash flow model which requires
management to make significant judgement and estimates
including estimates around inputs that are not directly
observable from market information and certain other
unobservable inputs such as projections of future cash
flows, long-term growth rates and discount rates used.
Changes to these assumptions could lead to material
changes in estimated recoverable amount, resulting in
impairment.
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Our audit procedures included, but were not limited, to the
following:
• Obtained an understanding of management's
process for identification of indicators of impairment
and evaluated the design and tested the operating
effectiveness of internal controls over such identification
and impairment assessment of investment in subsidiary;
• Obtained the management's external valuation
specialist's report on determination of recoverable
value and assessed the competency, objectivity and
capabilities of management's expert;
• Involved auditor's valuation experts to assess the
appropriateness of the valuation methodologies used
by the management expert and the key assumptions
including long-term growth rates, discount rates
amongst others used in computing the recoverable
amount;
• Obtained management's future cash flow forecasts and
tested the mathematical accuracy of the underlying
value in use calculations;
• Evaluated the reasonableness of future cash flows
forecasts used by the management by comparing
this with approved business plan, our understanding
of the business of the subsidiary, industry
benchmarks and data from historic performances;
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Key audit matter
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How our audit addressed the key audit matter
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Considering the materiality of the amounts involved,
inherent subjectivity, high estimation uncertainty and
significant management judgement and estimations
involved, impairment assessment of investment in
subsidiary has been considered as a key audit matter for
the current year audit.
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• Obtained the sensitivity analysis performed by the
management in respect of the key assumptions such
as discount rate and long-term growth rate and
evaluated whether any reasonably foreseeable change
in assumptions could lead to impairment or material
change in the carrying value; and
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• Evaluated the appropriateness and adequacy of
disclosures made in the standalone financial statements
in accordance with the requirements of applicable
accounting standards.
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Information other than the Standalone Financial Statements
and Auditor’s Report thereon
6. The Company's Board of Directors are responsible for
the other information. The other information comprises
the information included in the Annual Report, but does
not include the standalone financial statements and our
auditor's report thereon. The Annual Report is expected
to be made available to us after the date of this auditor's
report.
Our opinion on the standalone financial statements does
not cover the other information and we will not express
any form of assurance conclusion thereon.
In connection with our audit of the standalone financial
statements, our responsibility is to read the other
information identified above when it becomes available
and, in doing so, consider whether the other information
is materially inconsistent with the standalone financial
statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
When we read the Annual Report, if we conclude
that there is a material misstatement therein, we are
required to communicate the matter to those charged
with governance.
Responsibilities of Management and Those Charged with
Governance for the Standalone Financial Statements
7. The accompanying standalone financial statements have
been approved by the Company's Board of Directors. The
Company's Board of Directors are responsible for the
matters stated in section 134(5) of the Act with respect
to the preparation and presentation of these standalone
financial statements that give a true and fair view of the
financial position, financial performance including other
comprehensive income, changes in equity and cash flows
of the Company in accordance with the Ind AS specified
under section 133 of the Act and other accounting
principles generally accepted in India. This responsibility
also includes maintenance of adequate accounting
records in accordance with the provisions of the Act
for safeguarding of the assets of the Company and for
preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting
policies; making judgments and estimates that are
reasonable and prudent; and design, implementation
and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy
and completeness of the accounting records, relevant
to the preparation and presentation of the standalone
financial statements that give a true and fair view and
are free from material misstatement, whether due to
fraud or error.
8. In preparing the standalone financial statements, the
Board of Directors is responsible for assessing the
Company's ability to continue as a going concern,
disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting
unless the Board of Directors either intends to liquidate
the Company or to cease operations, or has no realistic
alternative but to do so.
9. The Board of Directors is also responsible for overseeing
the Company's financial reporting process.
Auditor’s Responsibilities for the Audit of the Standalone
Financial Statements
10. Our objectives are to obtain reasonable assurance
about whether the standalone financial statements as
a whole are free from material misstatement, whether
due to fraud or error, and to issue an auditor's report
that includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that
an audit conducted in accordance with Standards on
Auditing will always detect a material misstatement
when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in
the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the
basis of these standalone financial statements.
11. As part of an audit in accordance with Standards
on Auditing, specified under section 143(10) of the
Act we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement
of the standalone financial statements, whether due
to fraud or error, design and perform audit procedures
responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our
opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal
control;
• Obtain an understanding of internal control relevant to
the audit in order to design audit procedures that are
appropriate in the circumstances. Under section 143(3)(i)
of the Act we are also responsible for expressing our
opinion on whether the Company has adequate internal
financial controls with reference to financial statements
in place and the operating effectiveness of such controls;
• Evaluate the appropriateness of accounting policies used
and the reasonableness of accounting estimates and
related disclosures made by management;
• Conclude on the appropriateness of Board of Directors'
use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that
may cast significant doubt on the Company's ability
to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw
attention in our auditor's report to the related disclosures
in the standalone financial statements or, if such
disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained
up to the date of our auditor's report. However, future
events or conditions may cause the Company to cease to
continue as a going concern; and
• Evaluate the overall presentation, structure and content
of the standalone financial statements, including the
disclosures, and whether the standalone financial
statements represent the underlying transactions and
events in a manner that achieves fair presentation.
12. We communicate with those charged with governance
regarding, among other matters, the planned scope
and timing of the audit and significant audit findings,
including any significant deficiencies in internal control
that we identify during our audit.
13. We also provide those charged with governance with
a statement that we have complied with relevant
ethical requirements regarding independence, and to
communicate with them all relationships and other
matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
14. From the matters communicated with those charged
with governance, we determine those matters that
were of most significance in the audit of the standalone
financial statements of the current period and are
therefore the key audit matters. We describe these
matters in our auditor's report unless law or regulation
precludes public disclosure about the matter or when,
in extremely rare circumstances, we determine that
a matter should not be communicated in our report
because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest
benefits of such communication.
Report on Other Legal and Regulatory Requirements
15. As required by section 197(16) of the Act, based on our
audit, we report that the Company has paid remuneration
to its directors during the year in accordance with the
provisions of and limits laid down under section 197 read
with Schedule V to the Act.
16. As required by the Companies (Auditor's Report) Order,
2020 (‘the Order') issued by the Central Government of
India in terms of section 143(11) of the Act we give in
the Annexure A a statement on the matters specified in
paragraphs 3 and 4 of the Order, to the extent applicable.
17. Further to our comments in Annexure A, as required by
section 143(3) of the Act based on our audit, we report,
to the extent applicable, that:
a) We have sought and obtained all the information
and explanations which to the best of our
knowledge and belief were necessary for the
purpose of our audit of the accompanying
standalone financial statements.
b) Except for the matters stated in paragraph 17(h)(vi)
below on reporting under Rule 11(g) of the
Companies (Audit and Auditors) Rules, 2014 (as
amended)}, in our opinion, proper books of account
as required by law have been kept by the Company
so far as it appears from our examination of those
books.
c) The standalone financial statements dealt with
by this report are in agreement with the books of
account;
d) In our opinion, the aforesaid standalone financial
statements comply with Ind AS specified under
section 133 of the Act;
e) On the basis of the written representations received
from the directors and taken on record by the Board
of Directors, none of the directors is disqualified
as on 31 March 2025 from being appointed as a
director in terms of section 164(2) of the Act;
f) The qualification relating to the maintenance of
accounts and other matters connected therewith
are as stated in paragraph 17(b) above on reporting
under section 143(3)(b) of the Act and paragraph
17(h)(vi) below on reporting under Rule 11(g) of
the Companies (Audit and Auditors) Rules, 2014
(as amended);
g) With respect to the adequacy of the internal
financial controls with reference to financial
statements of the Company as on 31 March 2025
and the operating effectiveness of such controls,
refer to our separate report in Annexure B wherein
we have expressed an unmodified opinion; and
h) With respect to the other matters to be included in
the Auditor's Report in accordance with rule 11 of
the Companies (Audit and Auditors) Rules, 2014
(as amended), in our opinion and to the best of our
information and according to the explanations given to
us:
i. The Company, as detailed in note 38 to the
standalone financial statements, has disclosed
the impact of pending litigation(s) on its
financial position as at 31 March 2025;
ii. The Company did not have any long-term
contracts including derivative contracts for
which there were any material foreseeable
losses as at 31 March 2025;
iii. There has been no delay in transferring
amounts, required to be transferred, to the
Investor Education and Protection Fund by
the Company during the year ended 31 March
2025;
iv. a. The management has represented that,
to the best of its knowledge and belief, as
disclosed in note 46(g) to the standalone
financial statements, no funds have been
advanced or loaned or invested (either
from borrowed funds or securities premium
or any other sources or kind of funds) by
the Company to or in any person(s) or
entity(ies), including foreign entities (‘the
intermediaries'), with the understanding,
whether recorded in writing or otherwise,
that the intermediary shall, whether,
directly or indirectly lend or invest in other
persons or entities identified in any manner
whatsoever by or on behalf of the Company
(‘the Ultimate Beneficiaries') or provide any
guarantee, security or the like on behalf the
Ultimate Beneficiaries;
b. The management has represented that,
to the best of its knowledge and belief, as
disclosed in note 46(h) to the standalone
financial statements, no funds have
been received by the Company from any
person(s) or entity(ies), including foreign
entities (‘the Funding Parties'), with the
understanding, whether recorded in writing
or otherwise, that the Company shall,
whether 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; and
c. Based on such audit procedures performed
as considered reasonable and appropriate
in the circumstances, nothing has come to
our notice that has caused us to believe that
the management representations under
sub-clauses (a) and (b) above contain any
material misstatement.
v. As stated in note 48 to the accompanying
standalone financial statements, the Board of
Directors of the Company have proposed final
dividend for the year ended 31 March 2025
which is subject to the approval of the
members at the ensuing Annual General
Meeting. The dividend declared is in
accordance with section 123 of the Act to the
extent it applies to declaration of dividend.
vi. As stated in Note 45 to the standalone
financial statements and based on our
examination which included test checks, the
Company, in respect of financial year
commencing on 1 April 2024, has used an
accounting software for maintaining its books
of account which has a feature of recording
audit trail (edit log) facility and the same has
been operated throughout the year for all
relevant transactions recorded in the software
except that, the audit trail feature was not
enabled at the database level for accounting
software to log any direct data changes, used
for maintenance of all accounting records by
the Company. Further, during the course of our
audit we did not come across any instance of
audit trail feature being tampered with in
respect of the accounting software where such
feature is enabled. Furthermore, the audit trail
has been preserved by the Company as per the
statutory requirements for record retention.
For Walker Chandiok & Co LLP
Chartered Accountants
Firm's Registration No.: 001076N/N500013
Sd/-
Sandeep Mehta
Partner
Membership No.: 099410
UDIN: 25099410BMTCXR5847
Place: New Delhi
Date: 21 May 2025
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