2.14 Provisions
A Provision is recognised when the Company has a
present obligation (legal or constructive) as a result
of a past event and 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.
The amount recognised as a provision is the best
estimate of the consideration required to settle
the present obligation at the end of the reporting
period, taking into account the risks and uncertainties
surrounding the obligation. When a provision is
measured using the cash flows estimated to settle the
present obligation, its carrying amount is the present
value of those cash flows (when the effect of the time
value of money is material).
2.15 Contingent Liabilities
Contingent liability is disclosed for (i) Possible
obligation which will be confirmed only by the future
events not wholly within the control of the company or
(ii) Present obligations arising from past events where
it is not probable that an outflow of resources will be
required to settle the obligation or a reliable estimate
of the amount of the obligation cannot be made.
Contingent Assets
Contingent assets are not recognised in the financial
statements. A contingent asset is disclosed where an
inflow of economic benefits is probable. Contingent
assets are assessed continually and , if it is virtually
certain that an inflow of economic benefits will arise,
the asset and related income are recognised in the
period in which the change occurs.
2.16 Financial Instruments:
A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.
(a) Financial assets
Financial assets include cash and cash equivalents,
trade and other receivables, investments
in securities and other eligible current and
non-current assets.
At initial recognition, all financial assets are
measured at fair value. Such financial assets are
subsequently classified under one of the following
three categories according to the purpose for
which they are held. The classification is reviewed
at the end of each reporting period.
Financial assets at amortised cost: At the date of
initial recognition, are held to collect contractual
cash flows of principal and interest on principal
amount outstanding on specified dates. These
financial assets are intended to be held until
maturity. Therefore, they are subsequently
measured at amortised cost by applying the
Effective Interest Rate (EIR) method to the gross
carrying amount of the financial asset. The EIR
amortisation is included as interest income in the
profit or loss. The losses arising from impairment
are recognised in the profit or loss.
Financial assets at fair value through other
comprehensive income: At the date of initial
recognition, are held to collect contractual
cash flows of principal and interest on principal
amount outstanding on specified dates, as well as
held for selling. Therefore, they are subsequently
measured at each reporting date at fair value,
with all fair value movements recognised in Other
Comprehensive Income (OCI). Interest income
calculated using the Effective Interest Rate (EIR)
method, impairment gain or loss and foreign
exchange gain or loss are recognised in the
Statement of Profit and Loss. On derecognition
of the asset, cumulative gain or loss previously
recognised in Other Comprehensive Income
is reclassified from the OCI to Statement of
Profit and Loss.
Financial assets at fair value through profit or
loss: At the date of initial recognition, financial
assets are held for trading, or which are measured
neither at Amortised Cost nor at Fair Value through
OCI. Therefore, they are subsequently measured
at each reporting date at fair value, with all fair
value movements recognised in the Statement of
Profit and Loss.
Investment in Equity shares of subsidiaries and
associates are valued at cost.
The Company derecognises a financial asset when
the contractual rights to the cash flows from the
financial asset expire or it transfers the financial
asset and the transfer qualifies for derecognition
under Ind AS 109.
The company assesses impairment based on
the expected credit losses (ECL) model to all its
financial assets measured at amortised cost.
(b) Financial liabilities
Financial liabilities include long-term and short¬
term loans and borrowings, trade and other
payables and other eligible current and non¬
current liabilities.
All financial liabilities are recognised initially at
fair value and, in the case of loans and borrowings
and other payables, net of directly attributable
transaction costs. After initial recognition,
financial liabilities are classified under one of the
following two categories:
Financial liabilities at amortised cost: After
initial recognition, such financial liabilities are
subsequently measured at amortised cost by
applying the Effective Interest Rate (EIR) method
to the gross carrying amount of the financial
liability. The EIR amortisation is included in finance
expense in the profit or loss.
Financial liabilities at fair value through profit
or loss: which are designated as such on initial
recognition, or which are held for trading. Fair
value gains / losses attributable to changes in own
credit risk is recognised in OCI. These gains / losses
are not subsequently transferred to Statement of
Profit and Loss. All other changes in fair value of
such liabilities are recognised in the Statement of
Profit and Loss.
The Company derecognises a financial liability
when the obligation specified in the contract is
discharged, cancelled or expires.
2.17 Revenue Recognition
Revenue from contracts with customer
Revenue from contract with customers is recognised
when the Company satisfies performance obligation
by transferring promised goods and services to the
customer. Performance obligations are satisfied at the
point of time when the customer obtains controls of the
asset. Revenue is measured based on transaction price,
which is the fair value of the consideration received or
receivable, stated net of discounts, returns and goods
& service tax. Transaction price is recognised based on
the price specified in the contract, net of the estimated
sales incentives/ discounts if any.
Rental income
Rental income from investment property is recognised
as part of revenue from operations in profit or loss on a
straight-line basis over the term of the lease.
Dividend and interest income
Dividend income from investments is recognised
when the shareholder's right to receive payment has
been established (provided that it is probable that the
economic benefits will flow to the Company and the
amount of income can be measured reliably).
Interest income from a financial asset is recognised
when it is probable that the economic benefits will
flow to the Company and the amount of income can be
measured reliably. Interest income is accrued on a time
basis, by reference to the principal outstanding and at
the effective interest rate applicable, which is the rate
that exactly discounts estimated future cash receipts
through the expected life of the financial asset to that
asset's net carrying amount on initial recognition.
Receipts from insurance claims are accounted after the
same is approved by the insurance company.
2.18 Earnings per share
Basic earnings per share are calculated by dividing the
profit 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 profit 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.
2.19 Segment Reporting
Operating segments are reported in a manner
consistent with the internal reporting provided to
the Chief Operating Decision Maker (CODM) of the
Company. The CODM is responsible for allocating
resources and assessing performance of the operating
segments of the Company.
As a result of the Management review mechanism,
the Company has one segment "Welding Fabrication
Technology and Engineering" which includes
Manufacturing, Trading and Job Work.since Company
has only one Segment separate disclosure not given
2.20 Cash and Cash Equivalents
Cash and cash equivalents in the balance sheet
comprise cash at banks, cash on hand and highly liquid
short-term deposits with an original maturity of three
months or less, which are subject to an insignificant risk
of changes in value.
2.21 Statement of Cash Flows
Statement of Cash flows is reported using the indirect
method, whereby profit for the year is adjusted for
the effects of transactions of non-cash nature and any
deferrals or accruals of past or future cash receipts or
payments. The cash flows from operating, investing
and financing activities of the Company are segregated
based on the available information.
2.22 Operating Cycle
Based on the nature of products / activities of the
Company and the normal time between acquisition of
assets and their realisation in cash or cash equivalents,
the Company has determined its operating cycle as 12
months for the purpose of classification of its assets and
liabilities as current and non-current
Rights, preferences and restrictions attached to the equity shares
The Company has issued only one class of equity shares having a face value of ? 10/- per share. Each holder of equity shares is
entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by board
of directors is subject to the approval of shareholders in the ensuing Annual General Meeting. In the event of liquidation of
the company, the holder of equity shares will be entitled to receive remaining assets of the Company after distribution of all
preferential amounts. The distribution will be in proportion to the number of equity shares held by the share holders.
Description of Reserves
Retained earnings
Retained earnings represents surplus/accumulated earnings of the Company and are available for distribution to
shareholders.
Securities premium
Securities premium is used to record the premium received on issue of shares.Issue Expenditure related to IPO has been
adjusted against the Securities Premium . It is utilised in accordance with the provisions of the Companies Act, 2013.
Issue of Shares
The equity shares of the Company have been listed on National Stock Exchange of India Limited ("NSE") and on BSE Limited
("BSE") on October 4, 2024 by completing Initial Public Offer (''the IPO") of 93,55,000 equity shares of face value of ' 10/-each
at an issue price of ' 168/-per equity share (including share premium of ' 158/-per equity share) aggregating to ' 1,571.64
million and 50,000 equity shares to employees of face value of ' 10 each and an issue price of ' 160/- per equity shares
(including share premium of ' 150/- per equity share) aggregating to ' 8 million. Total amount aggregating to ' 1,579.64
million. ' 750.07 million was received from Anchor investors on 25th September 2024 and subsequently allotment was done
on 1st October 2024.
Capital Redemption Reserve
In FY 2001-02 company completed the Buy-Back of 4,72,150 equity shares of ' 10/- each at a Premium of ' 25.62 per share.
The total consideration paid was ' 1,68, 17,981/- out of which the Premium of ' 1,20,96,481/- was paid by utlising the share
premium account. The company has also transferred ' 47,21,500/- to the capital redemption reserve account from General
Reserve as a consequent to the Buy-Back of shares.
Capital Reserve
The company started creating the capital reserve for receipt of state subsidy from the year 1992-93.
General reserves
General Reserve represents appropriation of retained earnings and are available for distribution to shareholders
As per our report of even date For and on behalf of the Board of Directors of
For PGS & Associates Diffusion Engineers Limited
Chartered Accountants
F.R.N. : 0122384W
PREMAL H GANDHI PRASHANT N. GARG NITIN N GARG
Partner Chairman & Managing Director Director
Membership Number: 111592 DIN :- 00049106 DIN :- 08558736
Place : Mumbai Place : Nagpur Place : Nagpur
UDIN : 25111592BMMJFJ8535 Date : 15-05-2025 Date : 15-05-2025
Date : 15-05-2025
RAMESH KUMAR NARASINGHBHAN ABHISHEK MEHTA CHANCHAL JAISWAL
Chief Executive Officer Chief Financial Officer Company Secretary
Place : Nagpur Place : Nagpur Place : Nagpur
Date : 15-05-2025 Date : 15-05-2025 Date : 15-05-2025
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