(t) Provisions and contingent liabilities

Provisions are recognized when the Company has a present, legal or constructive obligation 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 of the amount of the obligation can be made. Provisions are determined
based on the best estimate required to settle the obligation at the Balance Sheet date. Provisions are reviewed
at each Balance Sheet date and adjusted to reflect current best estimates.

Provisions are measured at the present value of management's best estimate of the expenditure required
to settle the present obligation at the end of the reporting period. The discount rate used to determine the

present value is a pre-tax rate that reflects current market assessments of the time value of money and the
risks specific to the liability. The increase in the provision due to the passage of time is recognized as finance
cost.

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by
the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company
or a present obligation that is not recognized because it is not probable that an outflow of resources will be
required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a
liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a
contingent liability but discloses its existence in the financial statements. A disclosure for a contingent liability
is made where there is a possible obligation arising out of 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 arising out of a past event where it is either not probable that an
outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

(u) Employee Benefits

(i) Short-term Employee Benefits

The distinction between short term and long term employee benefits is based on expected timing of
settlement rather than the employee's entitlement benefits. All employee benefits payable within twelve
months of rendering the service are classified as short term benefits. Such benefits include salaries, wages,
bonus, short term compensated absences, awards, ex-gratia, performance pay etc. and are recognized in
the period in which the employee renders the related service.

(ii) Post-Employment benefits

1. Defined Contribution plan

The Company makes payment to approved superannuation schemes, state government provident fund
scheme and employee state insurance scheme which are defined contribution plans. The contribution
paid / payable under the schemes is recognized in the statement of profit and loss during the period in
which the employee renders the related service. The Company has no further obligations under these
schemes beyond its periodic contributions.

2. Defined Benefit plan

The employees' gratuity fund scheme is Company's defined benefit plan. The present value of the
obligation under such defined benefit plan is determined based on the actuarial valuation using the
Projected Unit Credit Method as at the date of the Balance sheet. In case of funded plans, the fair value of
plan asset is reduced from the gross obligation under the defined benefit plan, to recognize the obligation
on a net basis.

(iii) Long term Employment benefits

The employee's long term compensated absences are Company's other long term benefit plans. The present
value of the obligation is determined based on the actuarial valuation using the Projected Unit Credit Method
as at the date of Balance sheet. In case of funded plans, the fair value of plan asset is reduced from the gross
obligation, to recognize the obligation on a net basis.

In regard to other long term employment benefits, the Company recognizes the net total of service costs,
net interest on the net defined benefit liability (asset) and re-measurements of the net defined benefit
liability (asset) in the statement of profit and loss.

Gratuity

The Company provides for gratuity, a defined benefit plan (the "Gratuity Plan") covering eligible employees
in accordance with the Payment of Gratuity Act, 1972. The Gratuity Plan provides a lump sum payment to
vested employees at retirement, death or termination of employment, of an amount based on the respective
employee's salary and the tenure of employment.

The liability or asset recognized in the balance sheet in respect of defined benefit gratuity plans is the
present value of the defined benefit obligation at the end of the reporting period less the fair value of plan
assets. The defined benefit obligation is calculated annually by actuaries using the projected unit credit
method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash
outflows by reference to market yields at the end of the reporting period on government bonds that have
terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit
obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Statement
of Profit and Loss.

Remeasurements gains and losses arising from experience adjustments and changes in actuarial assumptions
are recognized in the period in which they occur, directly in other comprehensive income. They are included
in retained earnings in the statement of changes in equity and in the balance sheet.

Changes in the present value of the defined benefit obligation resulting from plan amendments or
curtailments are recognized immediately in profit or loss as past service cost.

Provident Fund

The Company operates two plans for its employees to provide employee benefits in the nature of provident
fund.

The Company pays provident fund contributions to publicly administered provident funds as per regulations.
The Company has no further payment obligations once the contributions have been paid. The contributions
are accounted for as defined contribution plans and the contributions are recognized as employee benefit
expense when they are due.

Eligible employees receive benefits from a provident fund, which is a defined benefit plan. Both the employee
and the Company make monthly contributions to the provident fund plan equal to a specified percentage of
the covered employee's salary.

Superannuation

Retirement benefit in the form of superannuation plan is a defined contribution plan. Defined contributions
to insurance Company for employees covered under Superannuation scheme are accounted at the rate of
15% of such employees' basic salary, restricted to ' 150,000/- p.a. The Company recognizes expense toward
the contribution paid / payable to the defined contribution plan as and when an employee renders the
relevant service. The Company has no obligation, other than the contribution payable to the superannuation
fund.

iv) Termination benefits

Termination benefits are payable when employment is terminated by the Company before the normal
retirement date or when an employee accepts voluntary redundancy in exchange for these benefits. The
Company recognizes termination benefits at the earlier of the following dates : (a) when the Company can
no longer withdraw the offer of those benefits; and (b) when the entity recognizes costs for a restructuring
that is within the scope of Ind AS 37 and involves the payment of termination benefits. In the case of an offer
made to encourage voluntary redundancy, the termination benefits are measured based on the number
of employees expected to accept the offer. Benefits falling due more than 12 months after the end of the
reporting period are discounted to present value.

(v) Paid up equity

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction,
net of tax, from the proceeds.

(w) Cash Flow Statement

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of
transactions of a non cash nature and deferral or accruals of past or future cash receipts or payments. The cash
flows from regular operating, investing and financing activities of the Company are segregated.

(x) Dividends to equity holders of the Company

The Company recognizes a liability to make cash or non-cash distributions to equity holders of the Company
when distribution is authorized and the distribution is no longer at the discretion of the Company. As per the
corporate laws in India, a distribution is authorized when it is approved by the shareholders. A corresponding
amount is recognized directly in equity.

(y) Earnings per share

(i) Basic Earnings per Share

Basic earnings per share is calculated by dividing the net profit for the period attributable to equity
shareholders by the weighted average number of equity shares outstanding during the financial year.
Earnings considered in ascertaining the Company's earnings per share is the net profit for the period after

deducting any attributable tax thereto for the period. The weighted average number of equity shares
outstanding during the period and for all periods presented is adjusted for events, such as bonus shares,
other than the conversion of potential equity shares that have changed the number of equity shares
outstanding, without a corresponding change in resources.

(ii) Diluted Earnings per Share

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to
equity shareholders and the weighted average number of shares outstanding during the period is adjusted
for the effects of all dilutive potential equity shares.

(z) Rounding of amounts

All amounts disclosed in these standalone financial statements and notes have been rounded off to the nearest
Million as per the requirement of Schedule III, unless otherwise stated.

2. Material accounting judgements, estimates and assumptions

The preparation of the Company's standalone financial statements requires management to make judgments,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and
the accompanying disclosures and the disclosure of contingent liabilities. This note provides an overview of
the areas that involve a higher degree of judgments or complexities and of items which are more likely to be
materially adjusted due to estimates and assumptions turning out to be different than those originally assessed.
Detailed information about each of these judgments, estimates and assumptions is mentioned below.

Judgments, estimates and assumptions are continually evaluated. They are based on historical experience and
other factors, including expectations of future events that may have a financial impact on the Company and that
are believed to be reasonable under the circumstances.

A. Judgements

In the process of applying the Company's accounting policies, management has made the following judgements,
which have the most significant effect on the amounts recognized in the standalone financial statements :

1. Legal Contingencies

The Company has received various orders and notices from tax authorities in respect of direct and indirect
taxes. The outcome of these matters may have a material effect on the financial position, results of
operations or cash flows. Management regularly analyzes current information about these matters and
makes judgments for providing provisions for probable contingent losses including the estimate of legal
expense to resolve the matters. In making the decision regarding the need for loss provisions, management
considers the degree of probability of an unfavorable outcome and the ability to make a sufficiently reliable
estimate of the amount of loss. The filing of a suit or formal assertion of a claim against the Company or the
disclosure of any such suit or assertions, does not automatically indicate that a provision of a loss may be
appropriate.

2. Segment Reporting

Ind AS 108 Operating Segments requires Management to determine the reportable segments for the
purpose of disclosure in standalone financial statements based on the internal reporting reviewed by Chief
Operating Decision Maker (CODM) to assess performance and allocate resources. The standard also requires
Management to make judgments with respect to aggregation of certain operating segments into one or
more reportable segment.

The Company has determined that the Chief Operating Decision Maker (CODM) is the Board of Directors
(BoD), based on its internal reporting structure and functions of the BoD. Operating segments used to
present segment information are identified based on the internal reports used and reviewed by the BoD to
assess performance and allocate resources.

3. Joint operation

The Company's composite Steel manufacturing facility at Ginigera is under a strategic alliance arrangement
with a joint venture partner. The facility is managed by Hospet Steels Limited. The alliance confers Kalyani
Steels Limited (KSL) and Mukand Limited (ML) with rights to assets, obligations for liabilities, sharing of
expenses / profit / loss in the proportion of product sharing ratio (viz. 41.38% by KSL and 58.62% by ML).
Thus, KSL and ML have right to the assets and obligations for the liabilities of this arrangement. Thus, the
strategic alliance is a joint arrangement in the nature of joint operation.

B. Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described below. The Company based its assumptions and estimates
on parameters available when the standalone financial statements were prepared. Existing circumstances and
assumptions about future developments, however, may change due to market changes or circumstances arising
that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

1. Defined benefit plans

The cost of the defined benefit plan and other post-employment benefits and the present value of such
obligation are determined using actuarial valuations. An actuarial valuation involves making various
assumptions that may differ from actual developments in the future. These include the determination of the
discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation
and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions.
All assumptions are reviewed at each reporting date. The parameter most subject to change is the discount
rate. In determining the appropriate discount rate for plans operated in India, the management considers
the interest rates of government bonds in currencies consistent with the currencies of the post-employment
benefit obligation. The mortality rate is based on Indian Assured Lives Mortality (2012-14) Ultimate. Those
mortality tables tend to change only at interval in response to demographic changes. Future salary increases
and benefit increases are based on expected future inflation rates. Further details about employee benefit
obligations are given in Note 37.

2. Fair value measurement of unquoted financial instruments

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be
measured based on quoted prices in active markets, their fair value is measured using valuation techniques
including the DCF model. The inputs to these models are taken from observable markets where possible,
but where this is not feasible, a degree of judgement is required in establishing fair values. Judgments
and estimates include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in
assumptions about these factors could affect the reported fair value of financial instruments. See Note 39
for further disclosures.

3. Impairment of Financial Assets

The impairment provisions for financial assets are based on assumptions about risk of default and expected
loss rates. The Company uses judgement in making these assumptions and estimates the inputs to the
impairment calculation, based on the Company's past history, existing market conditions as well as forward
looking estimates at the end of each reporting period.

4. Deferred Tax

At each balance sheet date, the Company assesses whether the realization of future tax benefits is sufficiently
probable to recognize deferred tax assets. This assessment requires the use of significant estimates with
respect to assessment of future taxable income. The recorded amount of total deferred tax asset could
change if estimates of projected future taxable income or if changes in current tax regulations are enacted.