Note 1 : Corporate Information

Shalby Limited (the company) is a company engaged in healthcare delivery space and listed with bourses in India. The registered office of the Company is located at Opposite Karnavati Club, Sarkhej Gandhinagar Highway, Near Prahladnagar Garden, Ahmedabad - 380 015. The company operates as a chain of multispecialty hospitals across India. The business of the company is to offer tertiary and quaternary healthcare services to patients in various areas of specialization such as orthopedics, complex joint replacements, cardiology, neurology, oncology, renal transplantations etc.

The standalone Ind AS financial statements for the year ended March 31, 2018 were authorized for issue in accordance with resolution passed by the Board of Directors of the company on May 7, 2018.

Note 2 : Basis of Preparation

These standalone Ind AS financial statements of the company have been prepared in accordance with Indian Accounting Standards (“Ind AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016, as applicable. For all periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with the then applicable Accounting Standards in India (‘previous GAAP’). These financial statements for the year ended March 31, 2018 are the first Ind AS financial statements. The date of transition to Ind AS is April 1, 2016. The comparative figures in the Balance Sheet as at March 31, 2017 and April 1, 2016 and Statement of Profit and Loss and Cash Flow Statement for the year ended March 31, 2017 have been restated accordingly. Accounting Policies have been consistently applied except where newly issued accounting standard is initially adopted or revision to the existing standards requires a change in the accounting policy hitherto in use. Management evaluates all recently issued or revised accounting standards on an on-going basis.

Refer Note 4.21 for the explanations of transition to Ind AS including the details of first-time adoption exemptions availed by the Company.

2.1 Statement of Compliance

The standalone Ind AS financial statements comprising Balance Sheet, Statement of Profit and Loss, Statement of Changes in Equity and Cash Flow Statement, together with notes for the year ended March 31, 2018 have been prepared in accordance with Ind AS as notified under section 133 of the Companies’ Act, 2013 (“the Act”) duly approved by the Board of Directors at its meeting held on May 7, 2018.

2.2 Basis of Measurement

The standalone Ind AS financial statements of the Company have been prepared and presented in accordance with the Generally Accepted Accounting Principles (GAAP) under the historical cost convention on accrual basis of accounting, except for certain Assets and Liabilities as stated below:

(a) Financial instruments (assets / liabilities) classified as Fair Value through profit or loss or Fair Value through Other Comprehensive Income are measured at Fair Value.

(b) The defined benefit asset/liability is recognised as the present value of defined benefit obligation less fair value of plan assets.

(c) Assets held for sale measured at fair value less cost to sales

The above items have been measured at Fair Value and the methods used to measure Fair Values are discussed further in Note 4.18.

2.3 Functional and Presentation Currency

Items included in the standalone financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (“the functional currency”). Indian Rupee is the functional currency of the Company.

The standalone financial statements are presented in Indian Rupees (Rs.) which is the company’s presentation currency, and all the values are rounded to the nearest millions except when otherwise stated.

2.4 Standard issued but not yet effective

Ministry of Corporate Affairs (MCA) issued the Companies (Indian Accounting Standards) (Amendments) Rules, 2018, (‘the Rules’) on 28th March, 2018.The rules notify the new Revenue Standard Ind AS 115 ‘Revenue from Contracts with Customers’ and also bring in amendments to existing Ind AS. The rules shall be effective from reporting period beginning on or after April 1, 2018 and cannot be reported early. Hence, not applied in the preparation of these financial statements.

2. Optional exemptions

(a) Deemed cost for property, plant and equipment, and intangible assets

Ind AS 101 permits a first-time adopter to opt to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 “Intangible Assets”

Accordingly, the Company has opted to measure all of its property, plant and equipment, and intangible assets at their previous GAAP carrying value.

(b) Investments in subsidiaries, joint ventures and associates

IND AS 101 provides the option to the firsttime adopter to account for its investments in subsidiaries, joint ventures and associates at either cost determined in accordance with IND AS 27 or in accordance with IND AS 109.

Accordingly, the Company has opted to measure such investments at cost in accordance with Ind AS 27.

(c) Past Business Combinations

Ind AS 101 allows a first-time adopter to opt not to apply Ind AS 103 “Business Combinations” retrospectively to past business combinations that occurred before the date of transition to Ind AS.

The Company has opted not to apply Ind AS 103 retrospectively to past business combinations that occurred before the transition date of April 1, 2016.

(d) Determining whether an arrangement contains a lease

The Company has applied Appendix C of Ind AS 17 determining whether an arrangement contains a lease on the basis of facts and circumstances existing at the transition date.

The Company has leases of land. The classification of each land as finance lease or operating lease at the date of transition to Ind AS is done based on the basis of facts and circumstances existing as at that date.

Note

The company has elected to continue with the carrying value of all of its property, plant and equipment recognised as of April 1, 2016 (transition date), measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

Note

The company has elected to continue with the carrying value of all of its intangible assets recognised as of April 1, 2016 (transition date), measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date. Details of gross block, accumulated depreciation and net block as per Indian GAAP are given in note 7.3

Note

1 The company had applied for registration of nine trademarks to Controller General of Patents Design and Trademarks, Department of Industrial Policy & Promotion during the period from March 2011 to July 2014, against which either the Department has objected or third parties have opposed for Registration. The Company, through it’s legal counsel, has submitted the requisite replies. Pending final registration, the amounts paid towards the same are shown as Intangible assets under Development.

2 The company has elected to continue with the carrying value of all of intangible assets under development recognised as of April 1, 2016 (transition date), measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

Note:

(i) In pursuance of agreement executed between the company and one of the subsidiary companies i.e. Vrundavan Shalby Hospitals Ltd., the outstanding balance as on December 31, 2017 on account of loans granted to such subsidiary has been classified as convertible loan since the same is convertible into equity at the option of the subsidiay company’s management.

(ii) The above loans were given for meeting cash flow (working capital) requirement of these companies at interest rate in compliance with section 186(7) of Companies Act 2013 which are generally repayable within a year unless extended by mutual consent.

Note:

In case of one of the subsidiary company i.e. Vrundavan Shalby Hospitals Limited (“such subsidiary company”), the proceeding u/s. 397398 of the Companies Act, 1956, instituted by two shareholders of the company vide company petition no. 18/2015 (CA 14/2017) before Company Law Board and later upon order of Hon’ble High Court of Mumbai at Goa remanded back to Hon’ble National Company Law Tribunal (NCLT), Mumbai Bench, has been disposed off vide order dated August 18, 2017 in pursuance of final settlement arrived at between the parties to the dispute post filing the consent terms dated July 14, 2017 before the appropriate authorities.

Pursuant to aforesaid settlement and consent terms dated July 14, 2017 filed before NCLT, the two shareholders, i.e. Dr. Digambar Naik and Mrs. Mangala Naik, agreed to transfer their balance entire 45% shareholding in such subsidiary company i.e. 40,500 shares owned by Dr. Digambar Naik and 40,500 shares owned by Mrs. Mangala Naik, in favour of Shalby Ltd., at agreed total consideration of Rs.46.80 Million to be paid by Shalby Ltd. Such subsidiary company, by virtue of such settlement and upon transfer of aforesaid shares, became wholly owned subsidiary Company of Shalby Limited.

Further, upon resolution passed by the Board of Directors of such subsidiary company in its meeting held on January 9, 2018, to suspend the entire operations with immediate effect and consider such subsidiary company as non- going entity, the Board of Directors of the Company in its meeting held on January 9, 2018 had decided to sale its investments in equity instruments of such subsidiary company. Therefore, investments in equity instruments of such subsidiary company has been classified as assets held for sale. The carrying value of investment in equity instruments of such subsidiary company as at March 31, 2018 amounts to Rs.131.92 Million. Based on the circle rates prevailing currently, the management expects to realise the consideration higher than the carrying amount of investments in equity instruments of such subsidiary company. Management expects the process of sale to be completed within 12 months from March 31, 2018.

Note 3.1 Rights, Preferences and Restrictions

The Authorised Share Capital of the Company consists of Equity Shares and Preference Shares both having nominal value of Rs.10 each. The rights and privileges to equity shareholders are general in nature and allowed under Companies Act, 2013.

The equity shareholders shall have:

(i) a right to vote in shareholders’ meeting. On a show of hands, every member present in person shall have one vote and on a poll, the voting rights shall be in proportion to his share of the paid up capital of the Company;

(ii) a right to receive dividend in proportion to the amount of capital paid up on the shares held.

The shareholders are not entitled to exercise any voting right either in person or through proxy at any meeting of the Company if calls or other sums payable have not been paid on due date.

In the event of winding up of the Company, the distribution of available assets/losses to the equity shareholders shall be in proportion to the paid up capital.

Note 3.2 Preference Shares

The Preference Share Capital comprising of 5,33,100 convertible / redeemable Preference Shares of Rs.10 each issued at premium have been considered and classified as Borrowings and accordingly disclosed under the head non current borrowings at amortised cost and the difference between the value of Preference Shares and the amortised cost has been adjusted against the opening reserves.

Note:

(i) In terms of provisions contained in Section 55 of the Companies Act 2013, the Company has, upon redemption of Preference Shares pursuant to resolution passed at the meeting held on December 20, 2016, transferred the amount equivalent to the face value of Preference Shares from the accumulated profits to Capital Redemption Reserve.

Note:

1 The above term loans have been availed by the company for the purpose of reimbursement of Capex incurred by hospitals at S. G. Highway and Bopal and for the purpose of Capex at its hospital at Jabalpur, Jaipur, Naroda, Indore, Surat and Mohali.

2 Pursuant to directions issued by the Reserve Bank of India, the buyers’ credit issued by AD Category - I banks are no longer entitled to be rolled over and therefore the entire outstanding amount of buyers’ credit are due for repayment within the period of 12 months. Acoordingly, the same has been classified under the head “ Current Financial Liabilities.”

3 Reference is invited to note 20.4 with regard to disclosure of preference share capital.

The Company, having established Super Specialty Hospitals at Indore and Jabalpur both in the State of Madhya Pradesh and at Naroda (Ahmedabad) and Surat both in the State of Gujarat, becomes eligible for one time incentive towards development of Healthcare sector in terms of policies of respective State Government in this regard. The incentive is based on capital investment and therefore is recognised in the form of capital subsidy. The same, being available against the entire capital investment, has been recognised and classified in accordance with Significant Accounting Policy referred at note 4.12 to the financial statements.

Note 4: Employee Benefits

Note 4.1 Defined Contribution Plan

The Company has defined contribution plan in form of Provident Fund & Pension Scheme and Employee State Insurance Scheme for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The total expense recognised in the Statement of profit and loss under employee benefit expenses in respect of such schemes are given below:

Note 4.2 Defined Benefit Plan

(a) Gratuity

The Company offers gratuity plan for its qualified employees which is payable as per the requirements of Payment of Gratuity Act, 1972. The benefit vests upon completion of five years of continuous service and once vested it is payable to employees on retirement or on termination of employment. In case of death while in service, the gratuity is payable irrespective of vesting.

(b) Defined Benefit Plan

The principal assumptions used for the purposes of the actuarial valuations were as follows.

(c) Sensitivity Analysis

The sensitivity of the defined benefit obligation to changes in the weighted principal assumption is:

The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined obligation calculated with the projected unit credit method at the end of reporting period) has been applied as when calculating the defined benefit liability recognised in the balance sheet. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior year.

(e) Risk Exposure

Through its defined benefit plans, the group is exposed to a number of risks, the most significant of which are detailed below:

Asset volatility

The plan liabilities are calculated using a discount rate set with reference to bond yields; if plan assets underperform this yield, this will create a deficit.

The gratuity fund is administered through Life Insurance Corporation of India (insurer) under its Group Gratuity Scheme. Accordingly almost the entire plan asset investment is maintained by the insurer. These are subject to interest rate risk which is managed by the insurer.

Changes in bond yields

A decrease in bond yields will increase plan liabilities, although this will be partially offset by an increase in the value of the plans’ assets maintained by the insurer.

(f) Defined benefit liability and employer contribution

The Company generally eliminates the deficit in the defined benefit gratuity plan within next one year.

Expected contribution to the post-employment benefit plan (Gratuity) for the year ending March 31, 2019 is Rs.3.65 Million.

The weighted average duration of the defined benefit obligation is 10.85 years (2016 - 10.6 years, 2015 - 10.53 years).

Note 5: Segment Information

The Company is mainly engaged in the business of setting up and managing hospitals and medical diagnostic services which constitute a single business segment. These activities are mainly conducted only in one geographical segment viz, India. Therefore, the disclosure requirements under the Ind AS 108 “Operating Segments” are not applicable.

Note 6: Business Combinations Summary of acquisition

Pursuant to scheme of Arrangement under Section 391 to 394 of the Companies Act, 1956, the Company on September 7, 2015 acquired Hospital division of Kamesh Bhargava Hospital and Research Centre Limited on a going concern basis. The acquisition has been accounted for using the acquisition method of accounting.

Note 7: Capital Management

The Company manages its capital to ensure that entities in the Company will be able to continue as going concerns while maximizing the return to stakeholders through the optimization of the debt and equity balance. The capital structure of the Company consists of net debt (borrowings offset by cash and bank balances) and total equity of the Company.

Fair value hierarchy

The following section explains the judgments and estimates made in determining the fair values of the financial instruments that are recognized and measured at fair value through profit or loss. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial investments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.

Notes:

Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) in active market for identical assets that the entity can access at the measurement date. This represents mutual funds that have price quoted by the respective mutual fund houses and are valued using the closing Net asset value (NAV).

Level 2 hierarchy includes the fair value of financial instruments measured using quoted prices for identical or similar assets in markets that are not active.

Level 3 if one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted compound instruments.

There are no transfers between any of these levels during the year. The Company’s policy is to recognize transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.

C. Valuation techniques used to determine fair value

Specific valuation techniques used to value financial instruments include:

(i) The use of quoted market prices or mutual fund houses quotes (NAV) for such instruments. This is included in Level 1

D. Fair value of financial assets and liabilities measured at amortized cost

The Management has assessed that fair value of loans, trade receivables, cash and cash equivalents, other bank balances, other financial assets and trade payables approximate their carrying amounts largely due to their short-term nature. Difference between carrying amount of Bank deposits, other financial assets, borrowings and other financial liabilities subsequently measured at amortised cost is not significant in each of the years presented.

For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

Note 8: Financial risk management

The Company’s Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. The board has established the Risk Management Committee, which is responsible for developing and monitoring the Company’s risk management policies. The Committee holds regular meetings and report to board on its activities.

The Company’s risk management policies are established to identify and analyses the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Company, through its training and management standards and procedures, aims to maintain 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 adequacy of the risk management framework in relation to the risks faced by the Company. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.

(a) Credit risk

Credit risk is the risk of financial loss to the company if a customer, or counterparty to a financial instrument fails to meet its contractual obligations. The company is exposed to the credit risk from its trade receivables, unbilled revenue, investments, cash and cash equivalents, bank deposits and other financial assets. The maximum exposure to credit risk is equal to the carrying value of the financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets.

Trade and other receivables

Trade receivables comprise a widespread customer base. Management evaluates credit risk relating to customers on an ongoing basis. If customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set for patients without medical aid insurance. Services to customers without medical aid insurance are settled in cash or using major credit cards on discharge date as far as possible. Credit Guarantees insurance is not purchased. The receivables are mainly unsecured; the company does not hold any collateral or a guarantee as security. The provision details of the trade receivable are provided in Note 15 of the financial statements.

Cash and Cash Equivalents

Credit risk on cash and cash equivalents and other deposits with banks is limited as the Company generally invests in deposits with banks with high credit ratings assigned by external credit rating agencies; accordingly the Company considers that the related credit risk is low. Impairment on these items is measured on the 12-month expected credit loss basis.

(b) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.

The Company’s treasury maintains flexibility in funding by maintaining liquidity through investments in liquid funds and other committed credit lines. Management monitors rolling forecasts of the group’s liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows.

Liquidity Table

The Company’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods is given below. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. The tables include both interest and principal cash flows. The contractual maturity is based on the earliest date on which the Company may be required to pay.

(c) Market Risk

Market risk is the risk arising from changes in market prices - such as foreign exchange rates and interest rates - will affect the Company’s income or the value of its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign currency receivables and payables and long term debt. The Company is exposed to market risk primarily related to foreign exchange rate risk, interest rate risk and the market value of the investments. Thus, the exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in foreign currency.

(i) Currency Risk

The Company is exposed to currency risk on account of foreign currency transactions including recognized assets and liabilities denominated in a currency that is not the Company’s functional currency O, primarily in respect of US$, and Euro. The Company ensures that the net exposure is kept to an acceptable level and is remain a net foreign exchange earner.

Exposure to currency risk

The currency profile of financial assets and financial liabilities are given below:

Sensitivity Analysis

Any change with respect to strengthening (weakening) of the Indian Rupee against various currencies as at March 31, 2018 and March 31, 2017 would have affected the measurement of financial instruments denominated in respective currencies and affected equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates.

(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 debt obligations with floating interest rates and investments

Most of the Company’s borrowings are on a floating rate of interest. The Company has exposure to interest rate risk, arising principally on changes in Marginal Cost of Funds based Lending Rate (MCLR). The Company uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements for its day to day operations like short term credit lines besides internal accruals.

Interest rate risk sensitivity:

The below mentioned sensitivity analysis is based on the exposure to interest rates for floating rate borrowings. For this it is assumed that the amount of the floating rate liability outstanding at the end of the reporting period was outstanding for the whole year. If interest rate had been 50 basis points higher or lower, other variables being held constant, following is the impact on profit.

(iii) Price Risk Exposure

The Company’s exposure to securities price risk arises from investments held in mutual funds and classified in the balance sheet at fair value through profit or loss. To manage its price risk arising from such investments, the Company diversifies its portfolio. Further these are all debt base securities for which the exposure is primarily on account of interest rate risk. Quotes (NAV) of these investments are available from the mutual fund houses.

Profit for the year would increase/decrease as a result of gains/losses on these securities classified as at fair value through profit or loss.

Note 9: Leasing arrangements: The Company being a lessee Operating lease arrangements

The Company has entered into operating lease arrangements for land and premises. The leases are non-cancellable and are for a period of 5 to 30 years and may be renewed for a further period, based on mutual agreement of the parties.

Note 10: Reconciliation between previous GAAP and Ind AS

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.

* The previous GAAP figures have been reclassified to confirm to Ind AS presentation requirements for the purposes of this note.

1. Reference is invited to note 4.3 to the financial statements. Leasehold land with lease term of 99 years or more and renewable with mutual consent are considered as finance leases with perpetual lease term and the same are not amortized with effect from April 1, 2016. Accordingly, for the amortization provided on such leasehold land during the year amounting to Rs.7.38 Million have been given effect in the value of Property, Plant and Equipment and corresponding effect has been given in Capital work in progress.

2. Prior period depreciation income (Net) amounting to Rs.0.97 Million have been credited to profit and loss account against depreciation expense and corresponding effects has been given in Property, Plant and Equipment.

3. Reference is invited to note 54 to the financial statements. In view of the same, deferred tax liability has been restated to the extent of Rs.171.62 Million.

4. Prior period adjustments have been given effect.

* The previous GAAP figures have been reclassified to conform to Ind AS presentation requirements for the purposes of this note.

1. Reference is invited to note 54 to the financial statements. In view of the same, deferred tax liability has been restated to the extent of Rs.11.70 Million and MAT credit amounting to Rs.190.00 Million is recognised.

2. Prior period adjustments have been given effect.

3. Reference is invited to note 20.4 to the financial statements.

* The previous GAAP figures have been reclassified to conform to Ind AS presentation requirements for the purposes of this note.

1. Prior period adjustments have been given effect.

2. Being actuarial gains / (losses) have been reclassified to other comprehensive income.

3. Reference is invited to note 54 to the financial statements. In view of the same, deferred tax liability has been restated to the extent of Rs.159.92 Million MAT credit had been carried to earlier years amounting to Rs.190.00 Million. Further deferred tax liability is created on reclassification of actuarial gains and losses amounting to Rs.1.24 Million.

The company has initiated the process of obtaining confirmation from suppliers who have registered themselves under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006). The above mentioned information has been compiled to the extent of responses received by the company from its suppliers with regard to their registration under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006).

(b) Confirmations

The company has circulated letters of Balance Confirmation to Sundry Debtors, Sundry Creditors and the parties to whom loans and advances have been granted. Confirmations were received in some cases.

Note 11 : IPO disclosure

The Company during the financial year 2017-18, has made an Initial Public Offer (IPO) of Rs.5,048 Million, comprising of fresh issue of Rs.4,800 Million and offer for sale of Rs.248 Million by one of the promoters.

The Company has incurred Rs.245.20 Mn. (exclusive of recovery from promoters) towards the offer related expenses as tabulated below. These expenses have been incurred in connection with raising of fresh equity capital and the same has been appropriated out of”Securities Premium Account”. However, for Income Tax purpose the same will be claimed in five equal installments under section 35D of Income Tax Act, 1961.

Note 12: Un-hedged Foreign Currency Exposure

The company does not enter into forward exchange contracts to hedge against its foreign currency exposures relating to the underlying transactions and firm commitments. The company does not enter into any derivative instruments for trading or speculative purposes.

Note 13: MAT Credit Entitlement and Deferred Tax assets / Liabilities

During the financial year ending on March 31, 2017, the Company recognized MAT credit entitlement aggregate amounting to Rs.300.03 million in respect of financial year 2016-17 and also in respect of earlier financial years. The Company while compiling the financial statements for the year under review in accordance with the provisions of Ind AS has restated the amounts of MAT credit entitlement under the respective financial years in order to normalize the tax impact.

Similarly, the Company has also restated the amounts of Deferred Tax recognized during the financial year under review, under respective financial years in order to normalize the tax impact.

Note 14: Statement of Management

(a) The non current financial assets, current financial assets and other current assets are good and recoverable and are approximately of the values, if realized in the ordinary courses of business unless and to the extent stated otherwise in the Accounts. Provision for all known liabilities is adequate and not in excess of amount reasonably necessary. There are no contingent liabilities except those stated in the notes.

(b) Balance Sheet, Statement of Profit and Loss, cash flow statement and change in equity read together with Notes to the accounts thereon, are drawn up so as to disclose the information required under the Companies Act, 2013 as well as give a true and fair view of the statement of affairs of the Company as at the end of the year and financial performance of the Company for the year under review.

Note 15: The figures for the previous year have been regrouped / reclassified, wherever necessary, to make them comparable with the figures for the current year. Figures are rounded off to nearest millions.