(i) The Company has accounted for Investment in Associates at cost. Refer to Note No. 50(A) for information on principal place of business / country of incorporation and the Company's interest / percentage of shareholding in the above associates.

(ii) The carrying amount of investment in Associates is tested for impairment in accordance with Ind AS 36. The investment in Associates are long term strategic in nature, no impairment is considered as at the reporting date, considering its long term future prospects.

By virtue of execution of Share Subscription and Purchase Agreement the Company had sold 12,15,40,789 equity shares of Lynks Logistics Limited ("Lynks") to Bundl Technologies Private Limited ("Bundl" operating under the brand name "Swiggy") and measured such investment at its Fair Value through Other Comprehensive Income (FVTOCI) in accordance with Ind AS 109. The Company simultaneously acquired 5,85,723 Compulsory Convertible Preference Shares (CCPS) of Bundl, in consideration of the sale of shares. The Company opted to designate such investment in CCPS of Bundl measured at Fair Value through Other Comprehensive Income (FVTOCI) in accordance with Ind AS 109 and recognise the fair value fluctuations through Other Comprehensive Income.

: (i) Loans are non-derivative financial assets and are carried at amortized cost, which generate fixed or variable interest income for the Company.

(ii) Loans to Related parties had been granted towards working capital in the normal course of business.

(iii) The Company has not granted any loan or advance in the nature of loan to promoters, directors and KMPs that are repayable on demand or without specifying any terms or period of repayment.

: (i) The Company is eligible to receive capital subsidy of $ 2,100.00 Lakhs from Government of Tamilnadu and the same has been reduced from cost of qualifying Property, Plant and Equipment. Out of the eligible subsidy amount, the Company has received $ 1,400.00 Lakhs upto the FY 2023-24. The balance amount of $ 700.00 Lakhs will be received in 2 annual installments. Out of this, an amount of $ 350.00 Lakhs has been reported under "Other Financial Assets (Non-Current)" and the balance amount of $ 350.00 Lakhs, which is receivable within 12 months of the balance sheet date has been classified under "Other Financial Assets (Current)".

(ii) The Company has made application for acquisition of 1,818 Nos. of equity share of M/s. The Ramaraju Surgical Cotton Mills Limited on rights basis and the equity shares has been allotted to the Company during April, 2024.

(i) Raw materials includes Goods-in-transit of $ 335.43 Lakhs (As at 31-03-2023 $ 770.12 Lakhs).

(ii) The total carrying amount of inventories as at reporting date has been pledged as Security for Borrowings.

(iii) The mode of valuation of inventories has been stated in the Note No. 5A

(iii) Rights / Restrictions attached to Equity Shares

The Company has one class of equity shares having a face value of Rs. 10/- each. Each Shareholder is eligible for one vote per share held. The Company declares and pays dividend in Indian Rupees. In the event of liquidation of the Company, the equity shareholders 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 shareholders.

# Smt. Ramachandra Raja Chittammal Member of Promoter Group demised on 15-09-2023. Subsequently the holdings of Smt. Ramachandra Raja Chittammal was transmitted to her daughters viz Smt. Alagaraja Ramalakshmi and Smt. Sethulakshmi Jayaraman on 26-03-2024 and they are classified as Member of Promoter Group in terms of Regulation 31A (6) of SEBI (LODR) Regulations 2015.

Nature of Reserve

Capital Reserve represents the difference between the shares allotted to the Share Holders of Transferor Company and Net Worth acquired from Transferor Company as per scheme of Amalgamation.

Nature of Reserve

Securities Premium was credited when shares are issued at a Premium. The Company can use this reserve to issue bonus shares, to provide for preliminary expenses, the commission paid or discount allowed and expenses related to any issue of shares of the Company.

Nature of Reserve

General Reserve represents the statutory reserve in accordance with Companies Act, 2013 wherein a portion of profit is apportioned to general reserve. Under Companies Act, 1956 it was mandatory to transfer amount before a Company can declare dividend, however under Companies Act, 2013 transfer of any amount to General reserve is at the discretion of the Company.

Nature of Reserve

Fair Value through Other Comprehensive Income Reserve represents the balance in equity for items to be accounted in Other Comprehensive Income (OCI). The Company has opted to recognise the changes in the fair value of certain investments in equity instruments and remeasurement of defined benefit obligations in OCI. The Company transfers amounts from this reserve to Retained Earnings in case of actuarial loss / gain and in case of fair value recognition of equity instrument, the same will be transferred when the respective equity instruments are derecognised.

i: Company is availing benefit under EPCG Scheme for import of capital goods and spare parts against obligation to export six times of the duty saved. The export obligation under the EPCG Scheme to be fulfilled on or before the financial year 2029-30. The Company is also importing cotton under Advance License Scheme against obligation to export the yarn / fabrics within 18 months from the date of license. The export obligation under the Advance License Scheme to be fulfilled on or before 30^th September, 2025.

i. Income Tax Assessment have been completed upto the Accounting Year ended 31^st March, 2022 i.e. AY 2022-23.

ii. Sales Tax / VAT Assessment has been completed upto the Accounting year 2016-17. The Assessment under CST Act was completed upto the Accounting year 2017-18.

iii. In respect of Electricity matters, Appeals / Writ petition are pending with TNERC / APTEL / High Court for various matters for which no provision has been made in the books of accounts to the extent of $ 484.04 Lakhs (PY: $ 474.39 Lakhs). In view of the various case laws decided in favour of the Company and in the opinion of the management, there may not be any tax liability on this matter.

Defined Benefit Plan - Gratuity

The Gratuity payable to employees is based on the employee's service and last drawn salary at the time of leaving the services of the Company and is in accordance with the rules of the Company read with Payment of Gratuity Act, 1972. This is a defined benefit plan in nature. The Company makes annual contributions to "Rajapalayam Mills Limited Employees' Gratuity Fund" administered by the Trustees and managed by LIC of India, based on the Actuarial Valuation by an Independent external actuary as at the Balance Sheet date using Projected Unit Credit method. The Company has the exposure of actuarial risk such as adverse salary growth, change in demography experience, inadequate return on underlying plan assets. This may result in an increase in cost of providing these benefits to employees in future. Since the benefits are lump sum in nature, the plan is not subject to any longevity risks.

The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (projected unit credit method) has been applied as when calculating the defined benefit obligation recognized within the Balance Sheet.

The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (projected unit credit method) has been applied as when calculating the defined benefit obligation recognized within the Balance Sheet.

DISCLOSURE OF FAIR VALUE MEASUREMENTS

The fair values of financial assets and liabilities are determined at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Fair value of cash and short-term deposits, trade and other short term receivables, trade payables, other current liabilities, short term loans from banks and other financial instruments approximate their carrying amounts largely due to their short term maturities of these instruments.

Fair value hierarchy

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments and investment properties by valuation technique:

Level 1 : Quoted (Unadjusted) prices in active markets for identical assets or liabilities.

Level 2 : Other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3 : Techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

NOTE NO. 53

FINANCIAL RISK MANAGEMENT

The Board of Directors (BOD) has overall responsibility for the establishment and oversight of the Company's risk management framework and thus established a risk management policy to identify and analyse the risk faced by the Company. Risk Management systems are reviewed by the BOD periodically to reflect changes in market conditions and the Company's activities. The Company through its training and management standards and procedures develop a disciplined and constructive control environment in which all employees understand their roles and obligations. The Audit Committee oversees how management monitors compliance with the Company's risk management policies and procedures, and reviews the risk management framework. The Audit committee is assisted in the oversight role by Internal Audit. Internal Audit undertakes reviews of the risk management controls and procedures, the results of which are reported to the Audit Committee.

The Board of Directors regularly reviews these risks and approves the risk management policies, which covers the management of these risks:

Credit Risk

Credit Risk is the risk of financial loss to the Company if the customer or counterparty to the financial instruments fails to meet its contractual obligations and arises principally from the Company's receivables, treasury operations and other operations that are in the nature of lease.

Receivables

The Company's exposure to credit risk is influenced mainly by the individual characteristic of each customer. The Company extends credit to its customers in the normal course of business by considering the factors such as financial reliability of customers. The Company evaluates the concentration of the risk with respect to trade receivables as low, as its customers are located in several jurisdictions and operate in largely independent markets. In case of Corporate / Export Customer, credit risks are mitigated by way of enforceable securities. However, unsecured credits are extended based on creditworthiness of the customers on case to case basis.

Trade receivables are written off when there is no reasonable expectation of recovery, such as a debtor declaring bankruptcy or failing to engage in a repayment plan with the company and where there is a probability of default, the company creates a provision based on Expected Credit Loss for trade receivables under simplified approach as below:

Financial Instruments and Cash deposits

Investments of surplus funds are made only with the approved counterparties. The Company is presently exposed to counter party risk relating to short term and medium term deposits placed with Banks. The Company places its cash equivalents based on the creditworthiness of the financial institutions.

Liquidity Risk

Liquidity Risks are those risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. In the management of liquidity risk, the Company monitors and maintains a level of cash and cash equivalents deemed adequate by the management to finance the company's operations and to mitigate the effects of fluctuations in cash flows.

Fund Management

Due to the dynamic nature of the underlying business, the Company aims at maintaining flexibility in funding by keeping both committed and uncommitted credit lines available. The Company has laid well defined policies and procedures facilitated by robust information system for timely and qualitative decision making by the management including its day to day operations.

Foreign Currency Risk

The Company's exposure in USD and other foreign currency denominated transactions in connection with import of cotton, capital goods & spares, besides exports of finished goods and borrowings in foreign currency, gives rise to exchange rate fluctuation risk. The Company has following policies to mitigate this risk:

Decisions regarding borrowing in Foreign Currency and hedging thereof, (both interest and exchange rate risk) and the quantum of coverage is driven by the necessity to keep the cost comparable. Foreign Currency loans, imports and exports transactions are hedged by way of forward contracts / packing credit in foreign currency which acts as natural hedge against export receivable. The Company enters the above transactions, after taking into consideration the anticipated Foreign exchange inflows/outflows, timing of cash flows, tenure of the forward contract and prevailing Foreign exchange market conditions.

The Company uses derivative financial instruments viz. Foreign Exchange Forward Contracts exclusively for hedging currency risks that arise from imports / exports transactions. The Company measures the risk by forecasting foreign currency cash flows and manages its currency risks by appropriately hedging the transactions. When a forward contract is entered into for the purpose of being a hedge, the Company finalizes the terms of those forward contracts to match the terms of the hedged exposure i.e. receivables / payables / Firm Commitments. All identified exposures are managed as per the policy duly approved by the Board of Directors.

Cash flow and fair value interest rate risk

Interest rate risk arises from long term borrowings with variable rates which exposed the company to cash flow interest rate risk. The Company's fixed rate borrowing are carried at amortized cost and therefore are not subject to interest rate risk as defined in Ind AS 107 since neither the carrying amount nor the future cash flows will fluctuate because of the change in market interest rates. The Company is exposed to the evolution of interest rates and credit markets for its future refinancing, which may result in a lower or higher cost of financing, which is mainly addressed through the management of the fixed/floating ratio of financial liabilities. The Company constantly monitors credit markets to strategize a well-balanced maturity profile in order to reduce both the risk of refinancing and large fluctuations of its financing cost. The Company believes that it can source funds for both short term and long term at a competitive rate considering its strong fundamentals on its financial position.

NOTE NO. 54

DISCLOSURE AS REQUIRED UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006: The categorization of supplier as MSME registered under the Act under new definition, has been determined based on the information available with the Company as at the reporting date. The Company has also considered suppliers as MSME who possess the erstwhile MSME certificate for the period upto the reporting date, for the purpose of categorization and disclosures. The disclosures as required under Micro, Small and Medium Enterprises Development Act, 2006:

e) Undisclosed Income

The Company do not have any transaction which are not recorded in the books of accounts that has been surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961 during any of the years.

f) Relationship with Struck off Companies

The Company did not have any transactions with Companies struck off under Section 248 of Companies Act, 2013 or Section 560 of Companies Act, 1956 considering the information available with the Company.

g) Details of Crypto Currency or Virtual Currency

The Company did not trade or invest in Crypto Currency or virtual currency during the financial year. Hence disclosure relating to it are not applicable.

h) The Company has neither advanced or loaned or invested, nor received any fund, to or from, any other persons or entities (intermediaries) with the understanding that the intermediary shall:

i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company or

ii) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

Formula adopted for above Ratios:

(a) Current Ratio = Current Assets / (Total Current Liabilities - Security Deposits payable on Demand - Current maturities of Long Term Debt)

(b) Debt-Equity Ratio = Total Debt / Total Equity

(c) Debt Service Coverage Ratio = (EBITDA - Current Tax) / (Principal Repayment Gross Interest)

(d) Return on Equity Ratio = Total Comprehensive Income / Average Total Equity

(e) Inventory Turnover Ratio (Average Inventory days) = 365 / (Net Revenue / Average Inventories)

(f) Trade receivables Turnover Ratio (Average Receivables days) = 365 / (Net Revenue / Average Trade receivables)

(g) Trade Payables Turnover Ratio (Average Payable days) = 365 / (Net Revenue / Average Trade payables)

(h) Net Capital Turnover Ratio = (Inventory Turnover Ratio Trade receivables turnover ratio - Trade payables turnover ratio)

(i) Net Profit Ratio = Net Profit / Net Revenue

(j) Return on Capital employed = (Total Comprehensive Income Interest) / (Average of (Equity Total Debt))

(k) Return on Investment (Assets) = Total Comprehensive Income / Average Total Assets.

Reasons for Variation if more than ± 25%:

Debt Service Coverage Ratio, Return on Equity, Net Profit Ratio & Return on Investment (Assets):

The operating margin during the financial year 2023-24 is declined on account of general slowdown in the textile industry and increase in finance cost due to expansion projects which results reduction in Debt Service Coverage Ratio, Return on Equity, Net Profit Ratio & Return on Investment.

Trade Receivable Turnover Ratio:

The Trade receivables as on 31-03-2024 has increased due to outstanding of invoices which are related to sale value of more value added yarn / fabric.

NOTE NO. 56

EXCEPTIONAL ITEMS

a. Profit on Sale of Investment:

The Company has decided to sell some of the investments held in the Shares of one of its associates viz. The Ramco Cements Limited as a means of finance of margin money for the project of fabric expansion and establishment of new processing unit. The Company has sold 6,13,000 Shares of The Ramco Cements Limited during the FY 2023-24 for a sale consideration of $ 5,486.82 Lakhs. After adjusting cost of sale $ 15.44 Lakhs and carrying cost of investment $ 90.19 Lakhs, the net profit on sale of investment of $ 5,381.19 Lakhs (PY: NIL) has been presented in the Statement of Profit and Loss as "Profit on Sale of Investment" under Exceptional Item.

b. Profit on Sale of Property, Plant & Equipment and Investment Property:

The Company has sold 0.41 Acres of Land located at Dhanot Village, Gujarat for a sale consideration of $ 22.00 Lakhs and 16.16 Acres of Land located at Anuppapatty Village, Palladam, Tamilnadu for a sale consideration of $ 323.20 Lakhs after adjusting the cost of acquisition of land & land development expenses of $ 6.93 Lakhs, the net profit on sale of land was $ 338.27 Lakhs (PY: $ 803.80 Lakhs).

The Company has modernized the old textile machineries during FY 2023-24 and sold the old machineries for a sale consideration of $ 171.38 Lakhs. The WDV of old machineries was $ 128.82 Lakhs. The Company has incurred profit on sale of the above old machineries to the extent of $ 42.56 Lakhs (PY: Loss of $ 61.31 Lakhs).

The aggregate net profit of $ 5,762.02 Lakhs (PY: $ 742.49 Lakhs) of above transactions is shown as an Exceptional Items in the Statement of Profit and Loss.

NOTE NO. 58 CAPITAL MANAGEMENT

For the purpose of the Company's capital management, capital includes issued equity share capital and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company's capital management is to maximize the Shareholders' wealth.

The Company manages its capital structure and makes adjustments in the light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus Debt.

The decrease in capital gearing ratio as at 31-03-2024 was due to repayment of Long term loans / reduction working capital loan. The Capital Gearing Ratio is expected to come down in the forthcoming years, once the Fabric expansion of projects start generating revenue / profits.

There are no significant changes in the objectives, policies or processes for managing capital during the years ended 31-03-2024 and 31-03-2023.