*During the FY 2023-24 the company has subscribed 1,05,00,00,000 (One Hundred Five Crore) 0.01% Non-Convertible, Non -Cumulative, participating redeemable Preference shares (NCPRPS) of Face Value H 10 /- each of Inox Wind Limited (subsidiary company)
**During FY 2023-24 the Company has purchased 210 bonds @10,00,000 Face Value of Inox Wind Limited on 28-10-2024 and 295 bonds @ 10,00,000 Face Value of Inox Green Energy Limited on various dates.
The Company on 25th May, 2022 has acquired 83,33,51,137 (Eighty-Three Crore Thirty-Three Lakh Fifty-One Thousand One Hundred and Thirty-Seven) 0.0001% Compulsorily Convertible Preference Shares of the face value of H 10/- each ("CCPS") of Inox Wind Limited, subsidiary company, upon variation of the terms of 83,33,51,137 0.01% Non-Convertible, Non-cumulative, participating, Redeemable Preference Shares of the face value of H 10/- each ("NCPRPS") held by the Company.
During FY 2022-23 all the 83,33,51,137 CCPS allotted on the variation of the terms of NCPRPS shall get converted into 6,61,38,978 fully paid-up equity shares of the face value of H 10/- each of Inox Wind Limited (""Equity Shares""), at a price of H 126/- per Equity Share (including a premium of H 116/-) for each CCPS ('Conversion Price')
Terms of repayment
(a) Loan from 360 One Prime Limited amounting to H 100 Crores received during the Current year @ 12.5% interest for period of 735 days from date of disbursement against pledge of 3,60,000 shares of Gujarat Fluorochemicals and 10,50,000 shares of the Inox Wind limited and 42,00,000 shares of Inox Green Services Limited subsidiary of the Company.
b) Rights/preferences and restrictions attached to equity shares :
The Company has only one class of equity shares having par value of H 10 per share. Each shareholder is eligible for one vote per share held and entitled to receive dividend as declared from time to time. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company, in proportion of their shareholding.
e) Details of shares allotted without payment being received in cash in last five years
During FY 2020-21, the Company has issued 1,09,85,000 fully paid-up equity share of H 10 each, pursuant to the Scheme of arrangement to the shareholders of the demerged company.
(f) The allotment of 8,26,446 totally paid up equity shares of the face value of H 10/- each of the Company on 26th July, 2023 to Devansh Trademark LLP, an entity forming part of the Promoter Group of the Conmpany, on a preferential issue basis, upon conversion of their 8,26,446 Convertible Warrants into Equity Shares at a price of H 847 per Equity Share (including a premium of H 837/-) for each Convertible Warrant. Promoter Group shareholding in the Company increased from 67.28% to 69.51%.In the FY 2022-23 company had converted all the share warrant of Anjana Project Private Limited 2,36,127 nos into equity share on 10-03-2023.
In the FY 2022-23 company had converted all the share warrant of Anjana Project Private Limited 2,36,127 nos into equity share on 10-03-2023. All warrant of Devansh Trademart LLP nos 8,26,446 are not converted till the end of financial year i.e. 31st March, 2023, and the holder of warrant (Devansh Trademart LLP) will be entitled to exercise the warrant in one or more tranche within a period of 18 month form date of allotment warrant.
In the FY 2023-24 company had converted all the share warrant of Devansh Trademark LLP 8,26,446 nos into equity share on 26-07-2023.
The above loans are unsecured. The inter-corporate deposits are repayable on demand and carry interest in the range of 7.00%-15.00% p.a. These loans are given for general business purposes.
31 : Related party transactions
Relationships
(i) Where control exists :
Holding Company
Inox Leasing and Finance Limited - Holding company
Subsidiaries Companies
Inox Wind Limited
Inox Green Energy Services Limited (Formerly known as Inox Wind Infrastructure Services Limited ) - Subsidiary of Inox Wind Limited
Gurantee/Security
The Company has given guarantee H 2,983 lakhs (31st March 2023 NIL) to Bank/financial institution against facility taken by Inox Green Energy Services Limited
Notes:
(a) Sales, purchases and service transactions with related parties are made at arm's length price.
(b) Amounts outstanding are unsecured and will be settled in cash or receipts of goods and services.
(c) No expense has been recognised for the year ended 31st March 2024 and for the period ended 31st March 2023 for bad or doubtful trade receivables in respect of amounts owed by related parties.
32 : Capital management
For the purpose of the Company's capital management, capital includes issued equity share capital, security premium and all other equity reserves attributable to the equity holders of the Company.
The Company' s capital management objectives are:
• to ensure the Company's ability to continue as a going concern
• to provide an adequate return to shareholders by pricing products and services commensurately with the level of risk.
The Company manages its capital to ensure that it will be able to continue as a going concern while maximising the return to the stakeholders through the optimization of the debt and equity balance. The Company monitors capital using a gearing ratio, which is net debt divided by total equity. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents, excluding discontinued operations, if any.
In order to achieve this overall objective, the Company's capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. No changes were made in the objectives, policies or processes for managing capital during the years ended 31st March, 2024 and 31st March, 2023.
(C) Financial risk management
The Company is exposed to financial risks which include market risk, credit risk and liquidity risk. The Company's management oversees the management of these risks. The management provides assurance that the Company's financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company's policies and risk objectives.
(i) Market Risk
Market risk comprises of currency risk, interest rate risk and other price risk.
The Company's activities expose it primarily to the financial risks of changes in interest rates.
(a) Interest rate risk management
Interest rate risk refers to the possibility that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rate. The Company is exposed to interest rate risk because it borrows funds at both fixed and floating interest rates. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings. Hedging activities are evaluated regularly to align with interest rate views and defined risk appetite, ensuring the most cost-effective hedging strategies are applied.
Interest rate sensitivity analysis
The interest rate sensitivity is not applicable on Company as its borrowings are on fixed interest rates for current year.
(b) Other price risks
Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price. Other price risk arises from financial assets such as investments in equity instruments and mutual funds. The Company does not have investment in equity instruments, other than investments in subsidiary which are held for strategic rather than trading purposes. The Company does not actively trade these investments. The Company's investment in mutual funds are in debt funds. Hence the Company's exposure to equity price risk is minimal.
(ii) Credit risk management
Credit risk refers to risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises primarily from financial assets such as trade receivables, other balances with banks, loans and other receivables.
(a) Trade receivables
Credit risk arising from trade receivables is managed in accordance with the Company's established policy, procedures and control relating to customer credit risk management. Major receivables of the company are from state electricity distribution companies (Discom). Customers who represents more than 5% of the total balance of Trade Receivable as at 31st March 2024 is Nil. All trade receivables are reviewed and assessed for default on a quarterly basis.
For trade receivables, as a practical expedient, the Company computes credit loss allowance based on a provision matrix. The provision matrix is prepared based on historically observed default rates over the expected life of trade receivables and is adjusted for forward-looking estimates. The provision matrix at the end of the reporting period is as follows:
b) Other balances with banks
Credit risk arising from other balances with banks is limited and there is no collateral held against these because the counterparties are banks and recognised financial institutions with high credit ratings assigned by the various credit rating agencies.
c) Loans and Other Receivables
The Company applies expected credit losses (ECL) model for measurement and recognition of loss allowance on the loans given by the Company to the external parties. ECL is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the Company expects to receive (i.e., all cash shortfalls), discounted at the original effective interest rate.
The Company determines if there has been a significant increase in credit risk of the financial asset since initial recognition. If the credit risk of such assets has not increased significantly, an amount equal to 12-month ECL is measured and recognized as loss allowance. However, if credit risk has increased significantly, an amount equal to lifetime ECL is measured and recognized as loss allowance.
12-month ECL are a portion of the lifetime ECL which result from default events that are possible within 12 months from the reporting date. Lifetime ECL are the expected credit losses resulting from all possible default events over the expected life of a financial asset.
ECL are measured in a manner that they reflect unbiased and probability weighted amounts determined by a range of outcomes, taking into account the time value of money and other reasonable information available as a result of past events, current conditions and forecasts of future economic conditions.
ECL impairment loss allowance (or reversal) recognized during the period is recognized as expense/income in the Statement of Profit and Loss under the head ‘Other expenses'/ 'Other income'. iii) Liquidity Risk Management
Ultimate responsibility for liquidity risk management rests with the committee of board of directors of the Company, which has established an appropriate liquidity risk management framework for the management of the Company's short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.
Liquidity and interest risk tables
The following table detail the analysis of derivative as well as non-derivative financial liabilities of the Company into relevant maturity groupings based on the remaining period from the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.
The above liabilities will be met by the Company from internal accruals, realization of current and non-current financial assets (other than strategic investments).
(iv) Fair value of financial assets and financial liabilities that are not measured at fair value (but fair value disclosures are required)
The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.
34 : Employee benefits
(A) Defined Contribution Plans
The Company contributes to the Government managed provident and pension fund for all qualifying employees. Contribution to provident fund of H 0.04 Lakhs (31st March 2023 : H 0 .53 Lakhs) is recognized as an expense and included in “Contribution to provident and other funds” in Statement of Profit and Loss.
(B) Defined Benefit Plans:
The Company has defined benefit plan for payment of gratuity to all qualifying employees. It is governed by the Payment of Gratuity Act, 1972. Under this Act, an employee who has completed five years of service is entitled to the specified benefit. The level of benefits provided depends on the employee's length of service and salary at retirement age. The Company's defined benefit plan is unfunded.
There are no other post retirement benefits provided by the Company.
The most recent actuarial valuation of the present value of the defined benefit obligation were carried out as at 31st March 2024 by Mr. Charan Gupta of M/S Charan Gupta Consultants Pvt Ltd, Fellow of the Institute of the Actuaries of India (at 31st March 2023 by Mr. Charan Gupta of M/S Charan Gupta Consultants Pvt Ltd, Fellow of the Institute of the Actuaries of India). The present value of the defined benefit obligation, the related current service cost and past service cost, were measured using the projected unit credit method.
Estimates of future salary increases considered in actuarial valuation take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.
These plans typically expose the Company to actuarial risks such as interest rate risk and salary risk.
a) Interest risk: a decrease in the bond interest rate will increase the plan liability.
b) Salary risk: the present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, a variation in the expected rate of salary increase of the plan participants will change the plan liability.
Sensitivity Analysis
Significant actuarial assumptions for the determination of defined obligation are discount rate and expected salary increase. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant. ......
The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumption would occur in isolation of one another as some of the assumptions may be correlated. Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.
The weighted average duration of the defined benefit plan obligation at the end of the year is 12.83 (31st March 2023 : 14.73 years)
(C) Other short term and long term employment benefits:
Annual leave and Short term leave
The liability towards compensated absences (annual and short term leave) for the year ended 31st March 2024 based on actuarial valuation carried out by using Projected accrued benefit method resulted in increase in liability of H 1.06 Lakhs (for the year ended 31st March 2023, Increase in liability of H2.23 Lakhs), which is included in the employee benefits in the Statement of Profit and Loss.
38: Analytical Ratios
The Company is termed as an Unregistered Core Investment Company (CIC) as per Reserve Bank of India Guidelines dated 13th August 2020 and is not exposed to any regulatory imposed capital requirements. Thus, the following analytical ratios are not applicable
to the Company:
1. Capital to risk-weighted assets ratio (CRAR)
2. Tier I CRAR
3. Tier II CRAR
4. Liquidity Coverage Ratio.
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39 : Contingent liabilities
(H in Lakhs)
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|
Particulars
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As at
31st March 2024
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As at
31st March 2023
|
|
i) Claims against the Company not acknowledged as debt claimed made by vendor
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208.74
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208.74
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Other money for which the Company is contingently liable:
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|
|
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ii) Litigation with one of the state electricity distribution boards
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870.00
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870.00
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iii) Income Tax demand in respect of assessment year 2013-14, 2014-15, 2015-16,202122,2013-14,2014-15,2015-16,2016-17,2018-19 .The Company is contesting the demand and has filed appeal under the applicable laws. Against this demand company has deposited H 96.40 Lakhs under protest
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5,434.77
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483.24
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iv) Company has received income tax demand in respect of assessment year 2018-19. company filed the appeal against the demand order in hon'ble high court of Gujarat as after demerger the company is not liable for the tax demand of assessment year 201819. hon'ble court of gujarat has quashed the assessment.
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|
|
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v) Company has received Indirect Tax Notice DRC-01 dated 31-01-2024. Reply has been filed by the Company
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2,448.73
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-
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vi) Claims against the Company not acknowledged as debt from customer
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4,801.50
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2,440.45
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vii) The Company has given Corporate Guarantee to Bank/financial institution against facility taken by Inox Green Energy Services Limited
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2,983.00
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-
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In respect of above matters, no additional provision is considered necessary as the Company expects favourable outcome. Further, it is not possible for the Company to estimate the timing and amounts of further cash outflows, if any, in respect of these matters.
Income tax demand in respect of assessment year 2018-19 is being quesh by hon'ble high court of Gujarat in favour of assessee on letter dated 31/01/2023 for the liability amount H 39,777.33 lakhs.
The Company has received Notice u/s 143(3) for Income Tax matters for AY. 2013-14 for H 6.05 lakh, 2014-15 for H304.78 lakh and 2015-16 for H 172.42 lakh. The comany has deposited 20% of demand and filled appeal before the CIT appeals. The matter is still pending.
The Company has received Notice u/s 147 for Income Tax matters for AY. 2013-14 for H 1298.12 lakh, 2014-15 for H 462.26 lakh and 2016-17 for 12.25 lakh. The matter is pending for hearing before CIT Appeals Ahmedabad. Rectification application has been filled by the company.
The Company has received Notice u/s 143(3) for Income Tax matters for AY. 2015-16 for H 257.63 lakh and 2016-17 for H 491.23 lakh. The matter is pending for hearing before CIT Appeals Ahmedabad. Rectification application has been filled by the company.
The Company has received Notice u/s 143(3) for Income Tax matters for AY. 2021-22 for H 2430.03 lakh and the matter is pending for hearing before CIT Appeals Ahmedabad.Writ petition filed with Hon'ble HC, Ahmedabad.
The Company has received show casue notice for Indirect tax matter u/s 73 for 2448.73 lakh dated 31st Jan 2024 for AY 2019-20. Reply has been filed against the Notice and the matter is pending before Commissioner GST appeals.
The Company has given Corporate Guarantee to Bank/Financial institution against facility taken by Inox Green Energy Services Limited in FY 2023-24 (FY 2022-23 NIL) of H 2,983 lakh out of which H 983 lakh given to Yes bank and H 2,000 given to ICICI bank in FY 2023-24.
40 : Segment information
Information reported to the chief operating decision maker (CODM) for the purpose of resource allocation and segment performance focuses on single business segment of generation of wind energy hence there is only one reportable business segment in terms of Ind AS 108: Operating Segment. The Company is operating in India which is considered as a single geographical segment.
41 : Revenue from contracts with customers as per Ind AS 115 (A) Disaggregated Revenue Information
In the following table, revenue from contracts with customers is disaggregated by primary major service lines Since the Company has business related to investment and Common Infrastructure Facilities services for WTGs, and accordingly company disaggregated revenue based on related services.
(B) Contract balances
All the Contract Liabilities have been separately presented in notes to accounts.
42 : During the year, Company has sold 4.49% Equity Shares of Inox Wind Limited (IWL) (Subsidiary) at a consideration of H 30,468 Lakhs in quarter 2. Further, the Company has sold 11.77% Equity Shares of Inox Wind Limited (IWL) (Subsidiary) at a consideration of H 80,650 Lakhs in Quarter 3. The Company has not lost control as defined in Ind AS 110 over Inox Wind Limited.
43 : Balance Confirmations
The Company has a system of obtaining periodic confirmation of balances from banks, trade receivables/payables and other parties (other than disputed parties). Party's balances are subject to confirmation / reconciliation. Adjustments, if any will be accounted for on confirmation/reconciliation of the same, which in the opinion of the management will not have a material impact.
44 : The Code on Social Security, 2020 (‘Code') relating to employee benefits during employment and post-employment benefits has received Presidential assent on 28th September 2020. The Code has been published in the Gazette of India. However, the effective date of the Code is yet to be notified and final rules for quantifying the financial impact are also yet to be issued. In view of this, the Company will assess the impact of the Code when relevant provisions are notified and will record related impact, if any, in the period the Code becomes effective.
45 : There are no events observed after the reported period which have a material impact on the company operations.
46 : There have been no delays in transferring amounts required to be transferred to the Investor Education and Protection Fund.
48 : The company has a comprehensive system of maintenance of information and documents as required by the Goods and Services Act(“GST Act”). Since the GST Act requires existence of such information and documentation to be contemporaneous in nature, books of accounts of the company are also subject to filing of GST Periodic and Annual Return as per applicable provisions of GST Act to determine whether the all transactions have been duly recorded and reconcile with the GST Portal. Adjustments, if any, arising while filing the GST Annual Return shall be accounted for as and when the return is filed for the current financial year. However, the management is of the opinion that the aforesaid annual return will not have any material impact on the Standalone financial statements.
49 : Discontinue Operations / Asset held for sale
On 28th March 2023, the Company's Board of Directors approved the transfer of its “Wind Energy Business” (hereinafter referred as “Business Undertaking”) to its holding company, M/s Inox Leasing and Finance Limited (“ILFL”) by way of slump sale through a Business Transfer Agreement.
Subsequently, to implement the above, the Company has executed Business Transfer Agreements dated March 29, 2023 for a purchase consideration of H 1,680.00 Lakhs. The Transfer of these 2 WTGs to the Buyer is completed.Further, Company has booked loss on the asset held for sale of these WTGs amounting to H 333.75 Lakhs.
The Company had changed its business plan and decided to sell upto an aggregate transaction amount of 40,000.00 Lakhs related to wind turbine generators and its various components viz. tower, blade etc. Accordingly, during the Previous year, Company has sold assets worth amouting to 3,912.50 Lakhs.
50: Other statutory information
(i) The company does not have any transaction with the companies struck off under SEC 248 of the Companies Act 2013 or section 560 of the Companies Act 1956 during the year ended March 31, 2024.
(ii) There are no charges or satisfaction which are to be registered with the registrar of companies during the year ended March 31, 2024 and March 31, 2023 except below:
(iii) The Company complies with the number of layers of companies in accordance with clause 87 of Section 2 of the Act read with the Companies (Restriction on number of layers) rules 2017 during the year ended March 31, 2024 and March 31, 2023.
(iv) The Company has not invested or traded in cryptocurrency or virtual currency during the year ended March 31, 2024 and
March 31, 2023.
(v) No proceedings have been initiated on or are pending against the company for holding Benami property under the Prohibition of Benami Property Transaction Act 1988 (as amended in 2016) (formally the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder during the year ended March 31, 2024 and March 31, 2023.
(vi) The Company has not been declared a wilful defaulter by any bank or financial institution or government or any government authorities during the year ended March 31, 2024 and March 31, 2023.
(vii) During the year ended March 31,2024 and March 31,2023, the Company has not surrendered or disclosed as income any transactions not recorded in the books of accounts in the course of tax assessments under the Income Tax Act, 1961 (such as search or survey or any other relevant provisions of the Income Tax Act 1961).
(viii) Except below, During the year ended March 31, 2024 and March 31, 2023, the Company has not advanced or loaned or invested funds (either borrowed funds or the share premium or kind of funds) to any other person or entities, including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the intermediary shall:
a. directly or indirectly land or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or
(ix) Except below, During the year ended March 31, 2024 and March 31, 2023, the Company has not received any funds from any persons or entities 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
In respect of above transaction, the company has complied relevant provisions of the Foreign Exchange Management Act, 1999, Companies Act 2013 and Prevention of Money-Laundering Act, 2002 to the extent applicable.
(x) Amalgamation
On June 12, 2023, the scheme of amalgamation of Inox Wind Energy Limited into Inox Wind Limited was approved, subject to various regulatory approvals and compliances. “BSE and NSE, through their letters dated December 27, 2023, have issued Observation Letters as required under Regulations 37 and 59A of the Listing Regulations with ‘No adverse observation/No objection' to the proposed scheme.” The approved swap ratio for the proposed merger is 158 equity shares of Inox Wind Limited for every 10 equity shares of Inox Wind Energy Limited. Following the approval of the bonus share issue by the Board on April 25, 2024, in the ratio of 3:1 (i.e., three new equity shares for every one equity share held), the swap ratio will be adjusted to 632 equity shares of Inox Wind Limited for every 10 equity shares of Inox Wind Energy Limited. Pursuant to an order from the Honourable NCLT Chandigarh dated April 16, 2024, meetings of the equity shareholders, debenture holders, and secured and unsecured creditors are scheduled to be held on June 1 and June 2, 2024
(xi) Except below, During the year ended March 31, 2024 and March 31, 2023, the Company has used the borrowings from financial institutions for the specific purpose for which it was taken at the balance sheet date :
51. Based on the standalone financial statement for the year ended March 31, 2024 and March 31,2023 the Company is a Core Investment company (CIC). The company has prepared the standalone financial statements as per the Division III of Schedule III of the
Companies Act, 2013.
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