2.17 Provisions and contingent liabilities
Provisions are recognised when there is a present
obligation as a result of a past event, it is probable that an
outflow of resources embodying economic benefits will
be required to settle the obligation and there is a reliable
estimate of the amount of the obligation. Provisions
are measured at the best estimate of the expenditure
required to settle the present obligations at the balance
sheet date and are not discounted to its present value.
These are reviewed at each balance sheet date and
adjusted to reflect the best current estimate.
Contingent liabilities are disclosed when there is
a possible obligation arising from past events, the
existence of which will be confirmed only by the
occurrence or non-occurrence of one or more uncertain
future events not wholly within the control of the
Company or a present obligation that arises from past
events where it is either not probable that an outflow of
resources will be required to settle the obligations or a
reliable estimate of the amount cannot be made.
2.18 Operating Cycle/ Current and Non-Current
Classification
Based on the nature of products and the time between
acquisition of assets for processing and their realisation
in cash and cash equivalents, the Company has
ascertained its operating cycle as twelve months for the
purpose of current/non-current classification of assets
and liabilities.
The Company presents assets and liabilities in
the Balance Sheet based on current/ non-current
classification. An asset is current when it is:
• Expected to be realised or intended to be sold or
consumed in normal operating cycle.
• It is held primarily for the purpose of trading
• Expected to be realised within twelve months after
the reporting period, or
• Cash or Cash Equivalent.
All other assets are classified as non-current.
A liability is current when:
• It is expected to be settled in normal operating cycle.
• It is held primarily for the purpose of trading.
• It is due to be settled within twelve months after the
reporting period, or
• There is no unconditional right to defer the
settlement of the liability for at least twelve months
after the reporting period.
The Company classifies all other liabilities as noncurrent.
Deferred tax assets and liabilities are classified as non¬
current assets and liabilities.
(c) Rights, preferences and restrictions attached to equity shares
The Company has only one class of equity shares having a par value of ' 10/- per share. The holder of the equity share
is entitled to dividend right and voting right in the same proportion as the capital paid-up on such equity share bears to
the total paid-up equity share capital of the Company. The dividend, if any, proposed by Board of Directors is subject to
approval of the shareholders in the ensuring Annual General Meeting, except in case of interim dividend. In the event of
liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after
distribution of all preferential amounts. The distribution will be in the same proportion as the capital paid-up on the equity
shares held by them bears to the total paid-up equity share capital of the Company.
(g) The Company has initiated its initial public offer (IPO) of 34,06,800 equity shares of face value of INR 10 each at an issue
price of INR 119 per share as fresh issue. The issue has been closed for subscription on 02 April 2024. Company has
allotted equity shares to the successful bidders on 04 April 2024 pursuant to section 42 and other relevant provisions of
the companies act 2013 at '119 including premium of '109 per share having face value of ' 10 each and shares of the
company got listed on National Stock Exchange of India Limited (NSE emerge) on 08 April 2024. The company has also
incurred ' 760.40 lakhs towards share issue expense for the aforementioned allotment.
(h) During the year ended 31 March 2024, On 07 August 2023, pursuant to section 42 and other relevant provisions of the
companies act 2013, the Company has issued 4,58,715 equity shares of the company on preferential allotment basis at
'119 including premium of '109 per share having face value of ' 10 each. The company has also incurred ' 758 lakhs
towards Share issue expense for the aforementioned preferential allotment.
(i) During the year ended 31 March 2024, On 22 July 2023 , the Company allotted 65,08,551 equity shares of '10/- each
as fully paid up bonus shares by utilising securities premium, capital redemption reserve and free reserves amounting
to ' 534.08 lakhs, 58.54 lakhs and 58.24 lakhs, respectively, pursuant to a resolution passed by shareholders in Extra
Ordinary General Meeting held on 21 July 2023.
Nature and purpose:
(a) Securities premium: Securities premium account is used to record the premium on issue of shares and is utilised in
accordance with the provisions of the Companies Act 2013.
(b) Capital Redemption Reserve: Capital Redemption Reserve is created for the shares redeemed/ buyback by the
Company in accordance with the provisions of the Companies Act 2013.
(c) Surplus/(Deficit) in Statement of Profit and Loss: Represents the amount of accumulated surplus/(deficit) earned till
date and remeasurements on post employment defined benefits plans.
(d) Other Comprehensive Income (OCI): Other Comprehensive Income Reserve represent the balance in equity for item
to be accounted in Other Comprehensive Income. OCI is classified into:
i) items that will not be reclassified to statement of income & expenses,
ii) items that will be reclassified to statement of income & expenses.
(e) Other comprehensive income: Other comprehensive income are remeasurements on post employment defined
benefits plans.
(f) Share application money pending allotment: Share application money pending allotment is the amount received from
investors during the application process for shares, but the allotment of shares has not yet been made.
33. Contingent liabilities and capital commitments
Contingent Liability
a) The Company has pending litigation with Public Works Department Rajasthan relating to rehabilitation work for
which matter is to be decide by Hon’ble High Court. The amount involved ' 83.48 lakhs as on 31 March 2025 and
31 March 2024.
b) The Company has pending litigation with Public Works Department Rajasthan relating to rehabilitation work for
which matter is to be decide by Hon’ble High Court. The amount involved ' 11.98 lakhs as on 31 March 2025 and
31 March 2024.
Based on legal advice, management believes that they have a strong case and no provision is required to be made.
Capital Commitment
Based on the information available with the Company, the capital commitment as at 31 March 2025 is ' 248.27 lakhs.
(As at 31 March 2024-' 2.18 lakhs).
34. Employee benefits
The disclosures required under Ind AS 19 “employee Benefits” notified in the Companies (Indian Accounting Standards)
Rules, 2015 are given below:-
i) Defined contribution plans
The Company makes contributions, determined as specified percentage of employee salaries in respect of
qualifying employees towards provident fund, employees state insurance and labour welfare fund, which are defined
contribution plans. The Company has no obligation other than to make the specified contributions. The contributions
are charged to statement of profit and loss as they accrue. The amount recognised as expense during year ended
31 March 2025 towards contribution to provident fund, state insurance and labour welfare fund aggregated to ' 1708
lakhs (31 March 2024 '13.49 lakhs).
ii) Defined benefit plans
The Gratuity amount has been computed based on respective employee’s salary and the years of employment with
the Company. Gratuity has been accrued based on actuarial valuation as at the balance sheet date, carried by an
independent actuary.
The following table sets forth the status of the gratuity plan of the Company and the amounts recognised in the
Balance Sheet and the Statement of Profit and Loss.
VII. Risk exposure
Interest Rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result
in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the
liability (as shown in financial statements).
Liquidity Risk:This is the risk that the Company is not able to meet the short-term gratuity payouts. This may arise due
to non availability of enough cash/cash equivalent to meet the liabilities or holding of liquid assets not being sold in time.
Salary Escalation Risk: The present value of the defined benefit plan is calculated with the assumption of salary
increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from
the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan’s liability.
Demographic Risk: The Company has used certain mortality and attrition assumptions in valuation of the liability. The
Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.
Regulatory Risk: Gratuity benefit is paid in accordance with the requirements of the Payment of Gratuity Act,1972 (as
amended from time to time).There is a risk of change in regulations requiring higher gratuity payouts (e.g. Increase in
the maximum limit on gratuity of ' 20 lacs).
35. Disclosure as required under Ind AS 116 Leases
The Company’s leases primarily consists of leases for building, fit-outs and vehicles. Generally, the contracts are made
for fixed period and does not have a purchase option at the end of lease term. The Company’s obligations under its
leases are secured by the lessor’s title to the leased assets. The Company applies the ‘short-term lease’ recognition
exemptions for these leases with lease terms of 12 months or less.
(c) Terms and conditions of transactions with related parties
The transactions with related parties are made on terms equivalent to those that prevail in arm’s length transactions.
Outstanding balances at the year end are unsecured and settlement occurs in cash.This assessment is undertaken
each financial year through examining the financial position of the related party and the market in which the related party
operates.
** Includes salary, bonus and contribution to provident fund and excludes provision of gratuity, since these are based on
actuarial valuation carried out for the Company as a whole.
37. Financial risk management objectives and policies
The Company’s principal financial liabilities comprises of borrowings, trade payables, lease liabilities, other financial
liabilities and financial assets includes investments, trade receivables, cash and cash equivalents, bank balances, other
financial assets that derive directly from its operations. The Company’s financial risk management is an integral part of
business plan and execution of business strategies. The Company is exposed to market risk, credit risk and liquidity risk.
The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized below.
A. Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes
in market prices. Market risk comprises of currency risk and interest rate risk. Financial instruments affected by
market risk include future commercial transactions, borrowings, investments, trade payables and trade receivables.
i) Foreign exchange risk
There is no foreign exchange risk on the company as no transaction has been done by the company in
foreign currency.
ii) 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’s exposure to the risk of changes in market interest rates
relates primarily to the Company’s borrowings with floating interest rates.
Credit risk arises from the possibility that the counterparty will default on its contractual obligations resulting in
financial loss to the Company. The Company is exposed to credit risk from trade receivables for construction
contracts and contract asset relating to construction contracts. The carrying amount of all financial assets represents
the maximum credit exposure.
(i) Trade receivables:
The Company periodically assesses the financial reliability of customers, taking into account the financial conditions,
current economic trends, and analysis of historical bad debts and ageing of accounts receivable. The Company
considers the probability of default upon initial recognition of assets and whether there has been a significant increase
in credit risk on an ongoing basis through each reporting period. The Company does not hold collateral as security.
The Company has not experienced any significant impairment losses in respect of trade receivables in the
past years.
(ii) Cash and bank balances including short term fixed deposits
The Company held cash and bank balance including fixed deposits of as at 31 March 2025'2,528.39 lakhs
and 31 March 2024'2,175.11 lakhs. These cash and bank balances are held with high rated banks/institutions
and short term in nature and therefore does not carry any significant credit risk.
Liquidity risk is defined as the risk that Company will not be able to settle or meet its obligation on time or at a
reasonable price. The Company’s objective is to all time maintain optimum level of equity to meet its cash and
liquidity requirements. The Company closely monitors its liquidity position and deploys a robust cash management
system. In addition, processes and policies related to such risk are overseen by senior management. Management
monitors the Company’s net liquidity position through rolling forecast on the basis of expected cash flows. Below is
the maturity profile of financial liabilities on undiscounted basis.
38. Capital management
The Company’s objective for managing capital is to ensure as under:
i) To ensure the company’s ability to continue as a going concern.
ii) Maintaining a strong credit rating and healthy debt equity ratio in order to support business and maximize the
shareholders’ value.
iii) Maintain an optimal capital structure.
iv) Compliance financial covenants under the borrowing facilities.
For the purpose of capital management, capital includes issued equity capital, and all other equity reserves attributable
to the equity holders of the Company. The Company manages its capital structure keeping in view of:
i) Compliance of financial covenants of borrowing facilities.
ii) Changes in economic conditions.
In order to achieve this overall objective of capital management, amongst other things, the Company aims to ensure that
it meets financial covenants attached to the borrowings facilities defining capital structure requirements, where breach in
meeting the financial covenants may permit the lender to call the borrowings. There have been no breach in the financial
covenants of any borrowing facilities in the current period. There is no change in the objectives, policies or processes
for managing capital over previous year. To maintain the capital structure, the Company may vary the dividend payment
to shareholders.
Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation
techniques as follows:
Level 1 - Quoted prices in active markets.
Level 2 - Inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly.
Level 3 - Inputs that are not based on observable market data.
- There is no amount unspent towards corporate social responsibility during the year ended 31 March 2025.
- The nature of corporate social responsibility activities undertaken by the Company for the year ended 31 March
2025 includes promoting health care including preventive health care.
43. There were no amounts which are required to be transferred to the Investor Education and Protection Fund by the
Company during the year ended 31 March 2025 and 2024.
44. Segment Reporting
As permitted by paragraph 4 of Ind AS 108, “Operating Segments" notified under section 133 of the Companies Act,
2013, read together with the relevant rules issued thereunder, if a single financial report contains both consolidated
financial statements and the standalone financial statements of the parents, segment information need to be presented
only on the basis of the consolidated financial statements. Thus, disclosures regarding Operating segment is presented
in Consolidated Financial Statements.
45. The Company did not enter into any transactions which are not recorded in the books of accounts and has been
surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 during the
year ended 31 March 2025 and 2024.
46. During the year ended 31 March 2025 and 2024, 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 (whether recorded in writing or otherwise) that the Intermediaries 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.
47 During the year ended 31 March 2025 and 2024, the Company has not received any funds 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 Company (Ultimate Beneficiaries) or
(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
48. No proceedings have been initiated or pending against the Company for holding any benami property under Benami
Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder during the year ended 31 March 2025
and 2024.
49. The Company has not traded or invested in Crypto currency or Virtual currency anytime during the year ended 31 March
2025 and 2024.
50. The company does not have any transaction/balances with struck off companies during the year ended 31 March 2025
and 2024.
51. The Company has not registered charges with the Registrar of Companies (ROC) amounting to '53.85 lakhs and '7725
lakhs beyond the statutory period for the year ended 31 March 2025 and 31 March 2024 respectively. Further, the
Company is in process of filling charge satisfaction with ROC for the loans amounting to '541.84 lakhs and '1,524.45
lakhs for the year ended 31 March 2025 and 31 March 2024 respectively.
52. 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
*The Company has charged project related inventories to the cost of constructions in the statement of profit and loss
due to application of Ind AS-115 on Revenue from Contract with Customers. The difference in trade receivables is due
to quarterly return submitted on provisional accounts basis, updated based on subsequent adjustments in the books
of account.
54. During the year ended 31 March 2025 and 2024, the Company has used the borrowings from banks and financial
institutions for the specific purpose for which it was taken at the balance sheet date.
55. The Company has not revalued any of its property, plant and equipment during the year ended 31 March 2025 and 2024.
Hence, the amount of change in gross and net carrying amount due to revaluation and impairment losses/reversals is nil.
56. The Company has not been declared as a wilful defaulter by any bank or financial institution or other lender in the year
ended 31 March 2025 and 2024.
57 During the year ended 31 March 2025 and 2024, no loans or advances in the nature of loans have been granted to
promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013,) either severally or jointly
with any other person, that are:
(a) repayable on demand, or,
(b) without specifying any terms or period of repayment.
58. The Company did not have any long-term contracts including derivatives contracts for which there were any material
foreseeable losses.
59. The Company has used an accounting software during the year for maintaining its books of account which has 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. However, the audit trail has not been preserved by the Company for previous year as per the
statutory requirements for record retention.
60. These standalone financial statements have been approved by the Board of Directors in their meeting held on 29
May 2025.
For S.N. Dhawan & CO LLP For and on behalf of the Board of Directors of
Chartered Accountants K2 Infragen Limited (Previously known as K2 Infragen Private Limited)
Firm Registration No.000050N/N500045
Rahul Singhal Pankaj Sharma Naresh Kumar
Partner Managing Director Director
Membership No.096570 DIN: 03318951 DIN: 09163376
Priyanka Pareek Jyoti Pulyani
Place: Gurugram CFO Company Secretary
Date: 29 May 2025 Membership No.: 424961 Membership No.: A55697
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