1. Information on Segment Reporting as per in AS 108 on "Operating Segments"

Operating Segments are those components of business whose operating results are regularly reviewed by the Managing Director in the Company to make decisions for performance assessment and resource allocation.

During the year, the Company was engaged in the business of manufacturing of Cement and Clinker, which is the only operating segment as per in AS 108.

2. Disclosure pursuant to in AS 24 on "Related Party Disclosures"

3. List of related parties :

i. Holding Company :

Bhadra Textiles and Trading Private Limited

ii. Ultimate Controlling Party :

Galaxy Technologies Private Limited

iii. Subsidiary Company :

Villa Trading Company Private Limited

iv. Promoter companies together with its subsidiaries and associate companies holding more than 20% of the Equity Share Capital :

a. Ria Holdings Ltd. h. Sameta Export Private Ltd.

b. Pranay Holdings Ltd. i. Pallor Trading Company Private Ltd.

c. Reeti Investments Private Ltd. j. The Arj Investments Limited

d. Prachit Holdings Ltd. k. Treasurer's Trading Limited

e. Sumaraj Holding Private Ltd. l. GIIC Limited

f. Sunnidhi Trading Private Ltd. m. Samja Mauritius Limited

g. Shree Anandeya Investment Pvt. Ltd. n. Mehta Investments Pte Limited

NOTES FORMING PART OF FINANCIAL STATEMENTS

4. List of related parties : (contd.)

v. List of Key Management Personnel with whom transactions were carried out during the year :

a. Mr. M. N. Mehta Chairman

b. Mr. Jay Mehta Executive Vice Chairman

c. Mr. M. S. Gilotra Managing Director

d. Mrs. Juhi Chawla Mehta Non-Executive Director

e. Mr. Hemnabh R. Khatau Non-Executive Director

f. Mr. Venkatesh Mysore Non-Executive Director

g. Mr. Y. K. Vyas Non-Executive Director

h. Mr. S. V. S. Raghavan Independent Director

i. Mr. M. L. Tandon Independent Director j. Mr. P. K. Behl Independent Director k. Mrs. Bhagyam Ramani Independent Director l. Mr. M. N. Rao Independent Director m. Mr. Bimal R. Thakkar Independent Director n. Mr. Kailash N. Bhandari Independent Director

vi. Enterprise having Key Management Personnel in common :

a. Saurashtra Cement Limited

5. Transactions and Balances with related parties : A Transactions with related parties :

a. As the liability for gratuity are provided on actuarial basis for the Company as a whole, the amounts mentioned are exclusive of gratuity.

b. The amount represents fair value of employee stock options granted during the year 2017-18 to be vested over a period of three years in terms of ESOS 2017.

c. In view of inadequacy of profit for the year 2015-16, remuneration paid by the Company to Mr. Jay Mehta (Executive Vice Chairman) was in excess of the limit prescribed under sections 197 and 198 read with Schedule V to the Companies Act, 2013. The Company has made application to the Central Government for approval of excess remuneration. Pending approval of the Central Government, an amount of ' 163.44 laces for the year 2015-16 is held in trust by him.

Since the options are yet to vest, the question of its exercise does not arise and hence, the exercise price or weighted average exercise price of the option is not given. Weighted average remaining contractual life for the share options outstanding as at March 31, 2018 was 4 years and 4.5 months.

6. Fair Valuation of Options Granted

The fair value of option have been done by an independent firm on the date of grant using the Black-Scholes Model. Black-Scholes Model takes into account exercise price, the term of the option, the market price of the share one day prior to the date of grant and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option.

The Key assumptions in the Black-Scholes Model for calculating fair value as on the date of grant :

1 Risk Free Rate : 7.12% (Vest 1), 7.31% (Vest 2), 7.46% (Vest 3)

2 Option Life : Average of [Minimum Life (Vesting period) Maximum Life (Vesting period Exercise period)]

which is 3.50 Years (Vest 1), 4.51 Years (Vest 2), 5.51 Years (Vest 3)

3 Expected Volatility : 48.47% (Vest 1), 48.04% (Vest 2), 66.60% (Vest 3)

4 Dividend Yield : Nil

Expected volatility on the Company's stock price on Bombay Stock Exchange based on the data commensurate with the expected life of the option up to the date of grant.

7. Expenses arising from equity-settled share-based payments to employees debited to the Statement of Profit and Loss is ' 78.37 laces (Previous year: ' Nil)

The fair value of Bank Deposits with more than 12 months maturities & earmarked balances and fair value of borrowed funds approximate carrying value as the interest rate of the said instruments are at the prevailing market rate of interest.

The carrying amount of financial assets and financial liabilities (other than borrowed funds) measured at mortised 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.

8.Fair Value Measurement

The fair values of the financial assets and liabilities are included 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. The following methods and assumptions were used to estimate the fair values :

i. Receivables are evaluated by the company based on history of past default as well as individual credit worthiness of the customer. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables, if required.

ii. The fair value of investment in optionally convertible debentures and interest free loans given is estimated by discounting future cash flows using rates currently available for loans with similar terms, credit risk and remaining maturities.

iii. The fair values of quoted equity shares are derived from quoted market prices in active markets.

The Company has established the following fair value hierarchy that categorizes the values into 3 levels. The inputs to valuation techniques used to measure fair value of financial instruments are :

Level 1 - This hierarchy uses quoted (unadjusted) market prices in active markets for identical assets or liabilities.

Level 2 - The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on company specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2.

Level 3 - If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3.

There is no transfer between Level 1 and Level 2 during the year.

9.Financial Risk Management Framework

The Company's financial risk management is an integral part of how to plan and execute its business strategies’. The risk management policy is approved by the Company's Board of Directors. The Company's principal financial liabilities comprises of borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the company's operations. The Company's principal financial assets comprises of trade and other receivables and cash and cash equivalents and bank balances other than cash and cash equivalents that are derived directly from its operations.

The Company's activities exposes it to market risk, credit risk and liquidity risk. Company's overall risk management focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the financial performance of the Company. The Company's senior management oversees the management of these risks. They provide 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. The Board of Directors review and agree policies for managing each of these risks, which are summarized below.

Market Risk :

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risks - interest rate risk, foreign exchange risk and commodity price risk in a fluctuating market environment. Financial instrument affected by market risks includes foreign currency receivables and payables.

The Company has designed risk management frame work to control various risks effectively to achieve the business objectives. This includes identification of risk, its assessment, control and monitoring at timely intervals.

Foreign Exchange Risk :

Foreign exchange risk is the risk of impact related to fair value or future cash flows of an exposure in foreign currency, which fluctuate due to changes in foreign exchange rates. The Company's exposure to the risk of changes in foreign exchange rates relates primarily to the import of fuels, raw materials and spare parts, capital expenditure and export of cement.

The Company evaluates exchange rate exposure arising from foreign currency transactions. The Company follows established risk management policies and standard operating procedures.

Foreign currency sensitivity on unheeded exposure :

Since the exposure is not significant, 1% increase in foreign exchange rates will have very negligible impact on profit before tax. 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 only to the overdraft facility availed in INR against fixed deposits. The Company doesn't have foreign currency borrowings. The company parks surplus funds in fixed deposits and avails overdraft facility against same to meet temporary fund requirement. The interest rate on overdraft facility is linked with interest rate on fixed deposit. Any adverse movement in interest rate will not affect profit before tax since the same will be offset by interest income earned on corresponding fixed deposit. Hence the interest rate risk is self-mitigated.

Interest rate exposure :

There is no significant interest rate risk as overdraft facility against fixed deposits have fixed margin over the interest rates of fixed deposits.

Commodity Price Risk :

Commodity price risk arises due to fluctuation in prices of coal, pet coke and other products. The company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs.

Credit Risk Management :

Credit risk arises when a customer or counterparty does not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its investing activities mainly deposits with banks and foreign exchange transactions. The Company has no significant concentration of credit risk with any counterparty.

Trade Receivables :

Customer credit is managed as per Company's established policies and procedures and control related to customer credit risk management. The Company has credit evaluation policy for each customer and based on the evaluation maximum exposure limit of each customer is defined. Deposits are taken from customers as per agreement with them. Wherever the Company assesses the credit risk as high the exposure is backed by either bank guarantee / letter of credit in addition to security deposits.

Outstanding receivable from customers is regularly monitored and if outstanding is above due date, further sales orders are controlled and can only be fulfilled if there is a proper justification. The Company does not have higher concentration of credit risks to a single customer.

Cash and Cash Equivalent and Bank Deposit :

Credit Risk on cash and cash equivalent, deposits with the banks is generally low as the said deposits have been made with the banks who have been assigned high credit rating by international and domestic rating agencies.

Liquidity Risk :

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. The Company manages liquidity risk by continuously monitoring forecast and actual cash flows on daily, monthly and yearly basis. Loan arrangements, credit limits with various banks including working capital and monitoring of operational and working capital issues are always kept in mind for better liquidity management. In addition, processes and policies related to such risks are overseen by senior management.

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.

G Notes to the reconciliation of Balance Sheet and Total Equity as at April 1, 2016 and March 31, 2017 and Statement of Profit and Loss and Total Comprehensive Income for the year ended March 31, 2017 1 Property, Plant and Equipment

i. The Company has elected to measure items of Property, Plant and Equipment and Intangible Assets at Cost as per in AS 16 except freehold land which is measured at its fair value at the date of transition.

ii. As per the accounting policy on Property, Plant and Equipment (PPE), spare parts, stand-by equipment and service equipment are recognized as PPE when they meet the definition thereof and are material.

Stores and spares which are held in Inventory / CWIP and satisfying above criteria are de-recognized from Inventory / CWIP and capitalized as PPE from the date of purchase. Similarly stores and spares which are consumed and satisfying above criteria are reversed from Statement of Profit and Loss and is capitalized as PPE.

Depreciation on capitalized stores and spares till the date of transition is accounted for in Retained Earnings and is charged to Statement of Profit and Loss for the year ended March 31, 2017.

iii. The Company has considered fair value as deemed cost for its land located at Sidheegram, Dist. - Gir Senath, Gujarat -362 276 in accordance with Para D5 of in AS 101. The impact of net increase in freehold land of ' 25,841.88 laces, after considering Deferred Tax Liability of ' 5,827.75 laces thereon, is reflected in Retained Earnings.

iv. The Company has provided amortization based on quantity of limestone / marl extracted during the year out of total deposit available for mining of its leasehold land of ' 83.16 laces, now so classified.

2 Investments

i. The Company has elected to carry its investment in equity shares of subsidiaries and associate at deemed cost which is its previous GAAP carrying amount at the date of transition and other equity investments at Fair Value through Other Comprehensive Income.

ii. The Company has measured its investment in debentures of subsidiaries on initial recognition at fair value and thereafter at mortised cost. On the date of conversion of these debentures, the excess of mortised cost of debentures over value of equity shares received on conversion is accounted as loss on conversion.

3 Loans / Other Financial assets / Other Current Assets

i. Under IGAAP, the Company had accounted for interest-free loan to employees at the undiscounted amount whereas under in AS, such financial assets are recognized at fair value on initial recognition and thereafter at mortised cost.

ii. As per Schedule III, Security Deposits are to be classified either under Loans or Other Non-current/Current Assets. Accordingly, Security Deposits which are financial in nature are classified under Loans and other deposits are classified under Non-current/ Current Assets.

iii. Fixed deposit with maturity greater than twelve months shown in IGAAP under Other Non-current Assets have been reclassified as Other Non-current Financial Assets as per Schedule III to Companies Act, 2013.

4 Deferred Tax

i. IGAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. in AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of in AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under IGAAP. Deferred Tax adjustments are recognized in correlation to the underlying transaction either in retained earnings or profit and loss or other comprehensive income respectively.

ii. As per in AS 12, the Company has considered MAT Credit entitlement as deferred tax asset being unused tax credit.

5 Revenue from Operations

i. Under IGAAP, discounts other than cash discounts / rate differences directly attributable to sales were recognized as part of other expenses which are adjusted against the revenue under in AS during the year ended March 31, 2017.

ii. Under IGAAP, revenue was presented net of excise duty. However, as per Schedule III to the Companies Act, 2013, revenue from operations is to be shown inclusive of excise duty. Accordingly, excise duty is included in revenue from operations and shown separately as an expense.

6 Defined benefit liabilities

Both under IGAAP and in AS, the Company recognized costs related to its post-employment defined benefit plan on an actuarial basis. Under IGAAP, the entire cost, including actuarial gains and losses, are charged to Statement of Profit and Loss. Under in AS, measurements comprising of actuarial gains and losses are recognized immediately in the balance sheet with a corresponding debit or credit to Retained Earnings through Other Comprehensive Income.