N. Provisions, Contingent Liabilities and Contingent assets

Provisions are recognised when the Company has a present obligation (legal or
constructive) as a result of a past event, it is probable that the Company will be required to
settle such obligation and a reliable estimate can be made of the amount of such 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 (where the effect of the time value of money is material).

When some or all of the economic benefits required to settle a provision are expected to
be recovered from a third party, a receivable is recognised as an asset if it is virtually
certain that reimbursement will be recovered and the amount of the receivable can be
measured reliably.

A disclosure for a contingent liability is made when there is a possible obligation or a
present obligation that may, but probably will not require an outflow of resources embodying
economic benefits or the amount of such obligation cannot be measured reliably. When
there is a possible obligation or a present obligation in respect of which likelihood of outflow
of resources embodying economic benefits is remote, no provision or disclosure is made

O. Earnings per share

Basic earnings per share is computed by dividing profit or loss attributable to equity
shareholders by the weighted average number of equity shares outstanding during the

year. Diluted earnings per share is determined by adjusting the profit or loss attributable to
equity shareholders and the weighted average number of equity shares outstanding for
the effects of all dilutive potential equity shares.

P. Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents
include cash on hand, deposits held at call with financial institutions/banks, other short¬
term, highly liquid investments with original maturities of three months or less that are
readily convertible to known amounts of cash and which are subject to an insignificant risk
of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in
current liabilities in the balance sheet..

Q. Borrowings

Borrowing cost incurred in connection with the funds borrowed for acquisition/erection of
assets that necessarily take substantial period of time to get ready for intended use, are
capitalized as part of such assets. Interest income earned on the temporary investment of
specific borrowings pending their expenditure on qualifying assets is deducted from the
borrowing cost eligible for capitalization. Borrowing cost also includes exchange differences
to the extent regarded as an adjustment to the borrowing costs. All other borrowing costs
are charged to revenue.

R. Inventories

Inventories are stated at the lower of cost and net realizable value. Net realizable value
represents the estimated selling price for inventories less all estimated costs of completion
and cost necessary to make the sale.

i) Cost of raw materials, components, stores, spares are valued at cost, determined on
a first-in-first-out basis.

ii) Materials and supplies held for use in production of inventories are not written down if
the finished products in which they will be used are expected to be sold at or above
cost. Slow and non-moving material, obsolesces, defective inventories are duly provided
for.

iii) By-products and scrap are valued at net realizable value and it is reduced from cost of
the main product.

iv) Excess/ shortages, if any, arising on physical verification are absorbed in the respective
consumption accounts.

v) The net realisable value of work-in-progress is determined with reference to the selling
prices of related finished products.

S. Cash flow statement:

Cash flows are reported using the indirect method, whereby the profit for the period is
adjusted for the effects of transactions of non-cash nature, any deferrals or accruals of
past or future operating cash receipts or payments and item of income or expenses
associated with investing or financing cash flows. The cash flows from operating, investing
and financing activities of the company are segregated.

30. Capital Management

Equity share capital and other equity are considered for the purpose of Company's capital management.

The Company manages its capital so as to safeguard its ability to continue as a going concern and to
optimise returns to shareholders. The capital structure of the Company is based on management's
judgement of its strategic and day-to-day needs with a focus on total equity so as to maintain investor,
creditors and market confidence.

The management and the Board of Directors monitor the return on capital as well as the level of dividend
to shareholders. The Company may take appropriate steps in order to maintain, or if necessary adjust,
its capital structure

Refer note 40 for information on ratios.

ii) Defined Benefit Plans

c) Gratuity

The company has unfunded defined benefit gratuity plan. Every employee who has
completed five years or more of service gets a gratuity on departure at 15 days salary
(last drawn salary) for each completed year of service as per the provision of the Payment
of Gratuity Act, 1972, as amended.

34. Impairment of Assets

According to an internal technical assessment carried out by the Company, there is no impairment in
the carrying cost of cash generating units of the Company in terms of Indian Accounting Standard 36
'Impairment of Assets

35. Exceptional items of Rs. 20.36 Lakhs for the year ended 31.03.2024 and Rs. 71.39.00 Lakhs for
the year ended 31.03.2023 are on account of profit on sale of old machinery

36. Revenue from operations includes other operating income of Rs.97.00 Lakhs on account of
withdrawal of interest provision made during quarter ended 30.09.2022 & 31.12.2022

Note:

1) Due to no manufacturing activity during the year except job work the working capital cycle of
the company reduced and hence thereby inventory, trade receivable and trade payable
ratios have been improved.

2) Due to job work income of low margin & higher fixed costs profitability of the company
decreased.

3) Due to no interest on loans & repayment during the year the Debt service coverage ratio is
not arrived

4) Due to negative earnings with negative equity the return on equity ratio is misleading and
hence not applicable or Zero

5) Due to no investments made by the company the return on investment ratio is not applicable.
Additional regulatory information required by Schedule III

41. No proceeding has been initiated or pending against the Company for holding any Benami
property under the Benami Transactions (Prohibition) Act, 1988, as amended, and rules
made thereunder.

42. The Company does not have any charges or satisfaction which is yet to be registered with
ROC beyond the statutory period.

43. The Company has not traded or invested in Crypto currency or Virtual Currency during the
financial year.

44. There were no transactions relating to previously unrecorded income that have been
surrendered and disclosed as income during the year in the tax assessments under the
Income Tax Act, 1961.

45. Relationship With Struck Off Companies

The Company does not have any relationship or any transaction with struck off companies.

46. Utilisation of borrowed funds and share premium:

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 that the
Intermediary 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

The company has not received any fund 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 Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries

47. Since the company deals only in Manufacturing of Cotton yarn products and there are no
geographical segments to be reported.

48. The previous year figures have been re-grouped / re-classified wherever required to conform
to current year's classification.

49. The financial statements are approved for issue by the Audit Committee and Board of
Directors at their meetings held on May 29, 2024.

^{As per our rep}°rt ^{of even date} For and on behalf of Board

^For Chevuturi Associates Kakatiya Textiles Limited

Chartered Accountants

Regn.No.000632S

Sd/- Sd/-

^Sd/- Vanka Raja Kumari Vanka Ravindranath

(CA Ranjita Vemuri) Director Director

Partner DIN .00480392 DIN 00480295

ICAI M.No.228471
UDIN:24228471BKFWPH7317

Sd/- Sd/-

Place: Tanuku V.HARI OBULA REDDY Peeyush Sethia

^Date : ^{29th May} 2024 Chief Financial Officer Company Secretary