(i) Depreciation has been provided prorata basis on straight line method using the useful lives and in the manner as prescribed under Schedule II of the Companies Act, 2013. (Refer Accounting Policies No. 2.6)
(ii) The Company has not revalued its Property, Plant and Equipment.
(iii) Interest during construction paid during the year amounting to Rs.Nil/-(March 31;2023: Rs. Nil/-) has been capitalised.
(iv) The title in respect of self -constructed buildings and title deeds of all other immovable properties (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee), disclosed in the financial statements included under Property, Plant and Equipment are held in the name of the Company as the balance sheet date.
(v) Vehicles taken on finance lease are financed from Yes Bank Limited,Kotak Mahindra PrIme Limited and HDFC Bank Limited (Refer Note No. 14.1)
(vi) Property, Plant and equipment pledged as security towards liabilities as on March 31,2024 and March 31, 2023 are as under (refer note no 14.1):
First and Exclusive Charge on Immovable Property Plot No. 57/1 and 57/1/19, industrial area site IV , Sahibabad, Ghaziabad in the name of the Company.
(a) Management is of the opinion that the fair value of the unquoted equity share of IFE Cranex Elevators & Excalators India Private Limited exceed the amount of investment made and hence there is no impairment in the value of investment.
(b) During the financial year 2021-22, the Company has invested an amount of Rs. 31.71 Lakhs in Shree Cranex (JV), a joint venture with Shree Construction. The share of the company as a designated partner in the total capital of the Joint Venture (JV) is 26 % which amounts to a capital contribution of Rs. 31.71Lakhs. The name and share of other designated partner of the Joint Venture (JV) are IFE Elevators Company Limited with a share of 74% which amounts to capital contribution of Rs. 124.55Lakhs.
No loans and advances are due from firms or private companies respectively in which any director is a partner, a director or a member or other officers of the company either severally or jointly with any other person.
(i) The deposits maintained by the Company with banks comprise of time deposits made of varying periods between three months to twelve months and earn interest at the respective short term deposit rates.
(ii) Fixed deposit with original maturity of more than twelve months but remaining maturity of less than twelve months have been disclosed under other bank balances. (refer note no.5.3)
(i) Security deposits include deposits with material suppliers.
(ii) No amounts are due to directors or other officers of the Company or any of them either severally or jointly with any other person. * Contract Assets represents unbilled portion of contract , which are not due for payment.
c) Terms/rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs.10/- per share (March 31,2023 : Rs.10/- per share). Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees.
In the event of liquidation of the Company, the holders of equity shares 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.
As per the records of the Company, including its register of shareholders/members and other declarations received from shareholders regarding beneficial interest, the above shareholdingrepresents both legal and beneficial ownership of shares. e) Aggregate number of shares bought back, or issued as fully paid up pursuant to contract without payment being received in cash or by way of bonus shares during the period of five years immediately preceding the date of Balance Sheet:
A) Term Loan from Kotak Mahindra Bank
I Working capital term loan from Kotak Mahindra Bank Limited is taken for a sum of Rs. 90 Lakhs ( Outstanding Balance as on 31.03.2024 Rs. 19.23 Lakhs) under WCCTL Guranteed Emergency Credit Line (GECL) to provide liquidity support and build up current asset and meet operational liabilities affected due to Covid 19 Pandemic
II The Term loan is secured by way of second exclusive hypothecation charge on all existing and future current assets, movable fixed assets.
III The Term loan is furthur secured by second exclusive equitable mortgage charge on immovable property Plot No. 57/1 and 57/1/19, industrial area site IV, Sahibabad, Ghaziabad in the name of Cranex Ltd.
V The Company has borrowings from banks on the basis of current assets. The Company has complied with the requirement of filing of quarterly returns/statements of security of current assets with the banks or financial institutions, as applicable, and these returns were in agreement with the books of accounts except as shown in note no. 31(8).
The differences are due to unaudited/provisional figures filed with banks
VI The borrowings obtained by the Company from banks have been applied for the purposes for which such loans were taken. In respect of term loans which were taken in the previous year, those were applied in the respective year for the purpose for which the loan were obtained.
VII There are no charges or satisfaction which are yet to be registered with the registered with the Registrar of Companies beyond the statutory period.
C) Unsecured Loan IFE Cranex Elevators & Esclators India Private Limited- An Associate Company.
The said loan has been granted in lieu of bank gurantees given by the Company for projects.The Loan is interest free and is repayable on extinguishment of bank gurantees as and when it occurs. There are no amount due for repayment in F.Y 2024-25.
D) The Company has not defaulted in repayment of principal amount and interest during the year and complied with loan covenants of the lenders.
(i) The Company has availed working capital limits of Rs.3185 Lakhs (Previous Year Rs.285 Lakhs) from Kotak Mahindra Bank which is secured by way of first charge on Book Debts of the Company.In the given working capital limit, fund based limit is of Rs. 1327 Lakhs and Non Fund based limit is to the extent of Rs. 1885 Lakhs.
The Working Capital Limit is secured by way of first and exclusive hypothecation charge on all existing and future and current assets, movable fixed assets or any interest therein.
The Working Capital limit is furthur secured by Exclusive Equitable Charge on Immovable Property Plot No. 57/1 and 57/1/19, industrial area site IV, Sahibabad, Ghaziabad in the name of the company
The Company has borrowings from banks on the basis of current assets. The Company has complied with the requirement of filing of quarterly returns/statements of security of current assets with the banks or financial institutions, as applicable, and these returns were in agreement with the books of accounts except as shown in note no. 31(8).
The differences are due to unaudited/provisional figures filed with banks
Aggregate amount of Working Capital Limits secured by way of personal guarantees of Mr. Piyush Aggarwal (Director) and Mr. Chaitanya Aggarwal (Director)
(ii) The Company has been sanctioned an unsecured loan of Rs. 300 lakhs by National Small Industries Corporation Limited (NSICL) for its business needs. The Company has not furnished any security. However, Bank Gurantee equivalent to the value of limit sanctioned from Kotak Mahindra Bank been charged against the said loan.
(iii) The effective rate of interest on short term borrowings ranges between 9.75% p.a. to 10.30% p.a. during the year, depending upon the prime lending rate of the banks and financial institutions at the time of borrowing, wherever applicable, and interest rate spread agreed with the banks.
* Trade payables includes due to related parties Rs. Nil/- (March 31, 2023: Nil/-)
* The amounts are unsecured and are usually paid within 120 days of recognition.
* Trade payables are usually non- interest bearing .In few cases ,where the trade payables are interest bearing, the interest is settled
on quarterly basis.
(i) Information as required to be furnished as per section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) for the year ended March 31, 2024 is given below. This information has been determined to the extent such parties have been identified on the basis of information available with the Company.
(v) Performance Obligation
Sale of products: Performance obligation in respect of sale of goods is satisfied when control of the goods is transferred to the customer, generally on delivery of the goods and payment is generally due as per the terms of contract with customers Sales of services: The performance obligation in respect of maintenance services is satisfied over a period of time and acceptance of the customer. In respect of these services, payment is generally due upon completion of maintenance period based on time elapsed and acceptance of the customer.
31 OTHER NOTES ON ACCOUNTS
1 a) In the opinion of the Board, assets have a value on realization in the ordinary course of business at least equal to the amount
at which they are stated.
b) Balance of unsecured short term bororrowings from others, trade payables, other current liabilities, long and short term advances, other non-current and current assets and trade receivables are subject to reconciliation and confirmations.
2 Disclosures pursuant to Ind AS - 19 "Employee Benefits" (specified under section 133 of the Companies Act, 2013, read with Rule 7 of Companies (Accounts) Rules, 2015 ) are given below:
Defined Contribution Plan
j) The average duration of the defined benefit plan obligation at the end of the reporting period is 8.09 years.(Previous Year-8.18 years)
k) The estimates of rate of escalation in salary considered in actuarial valuation are after taking into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is as certified by the Actuary.
l) Discount rate is based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of the obligations.
m) The sensitivity analysis above have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period.
3 The company has provided gratuity liability with retrospective effect in accordance with acturial valuation norms to comply with the requirements of Ind AS 19. Accordingly, a sum of Rs. 69.88 Lakhs pertaining to gratuity liability as on 01/04/2024 has been adjusted against retained earnings. Disclosures as required in Ind AS 19 have been made in note no. 31(2).
4 Related party transactions
The related parties as per the terms of Ind AS-24,"Related Party Disclosures", (specified under section 133 of the Companies Act, 2013, read with Rule 7 of Companies (Accounts) Rules, 2015) are disclosed below:
A Names of related parties and description of relationship:
Key Managerial Personnel
a) The transactions with related parties are made on terms equivalent to those that prevail in arm's length transactions. Outstanding balances at the year-end are unsecured and interest free (other than borrowings taken by the Company) and settlement occurs in cash.
For the year ended March 31, 2024, the Company has not recorded any impairment of receivables relating to amounts owed by related parties. This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.
b) All the liabilities for post retirement benefits being 'Gratuity' and 'Leave Encashment' are provided on an actuarial basis for the Company as a whole, the amount pertaining to Key management personnel are not included above.
c) As per the section 149(6) of the Companies Act, 2013, Independent Directors are not considered as “Key Managerial Person”, however to comply with the disclosure requirements of Ind AS-24 on “Related party transactions” they have been disclosed as “Key Managerial Person”.
7 Corporate Social Responsibility
Pursuant to the provisions of Section 135 of the Companies Act, 2013, Every company having net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net prot of rupees ve crore or more during the immediately preceding financial year is required to incur at least 2% of the average net profits of the preceding three financial years towards Corporate Social Responsibility (CSR).
Based on last audited balance sheet dated 31 March, 2024, the company does not meet any of the threshold prescribed by law. Hence, the provisions of Companies Act, 2013 regarding CSR would not be applicable
9 Segment Reporting
Segment information is presented in respect of the Company's key operating segments. The operating segments are based on the Company's management and internal reporting structure.
Operating Segments
TThe Company's Managing Director and CFO has been identied as the Chief Operating Decision Maker ('CODM'), since Managing Director and CFO are responsible for all major decision w.r.t. the preparation and execution of business plan, preparation of budget and other key decisions.
Managing director reviews the operating results at the Company level to make decisions about the Company's performance. Accordingly, management has identied the business as single operating segment i.e. "Manufacturing of EOT cranes and installation of escalators". Accordingly, there is only one Reportable Segment for the Company i.e. "Manufacturing of EOT cranes and installation of escalators", hence no specic disclosures have been made.
The fair value of the financial assets and liabilities is 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:
1) The fair value of unquoted instruments, loans from banks and other financial liabilities, as well as other non-current financial liabilities is estimated by discounting future cash flows using rates currently available for debt on similar terms, credit risk and remaining maturities. In addition to being sensitive to a reasonably possible change in the forecast cash flows or the discount rate, the fair value of the equity instruments is also sensitive to a reasonably possible change in the growth rates. The valuation requires management to use unobservable inputs in the model, of which the significant unobservable inputs are disclosed in the tables below. Management regularly assesses a range of reasonably possible alternatives for those significant unobservable inputs and determines their impact on the total fair value.
2) The fair values of the Company's interest-bearing borrowings and loans are determined by using Discounted cash flow method using discount rate that reflects the issuer's borrowing rate as at the end of the reporting period. The own non-performance risk as at 31 March 2023 was assessed to be insignificant.
3) Long-term receivables/ payables are evaluated by the Company based on parameters such as interest rates, risk factors, individual creditworthiness of the counterparty and the risk characteristics of the financed project. Based on this evaluation, allowances are
taken into account for the expected credit losses of these receivables.
4) The significant unobservable inputs used in the fair value measurement categorized within Level 1 and Level 3 of the fair value hierarchy together with a quantitative sensitivity analysis as at end of each year, are as shown below:
Fair value hierarchy
The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:
Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities
Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value are observable, either directly or indirectly
Level 3: techniques that use inputs that have a significant effect on the recorded fair value that are not based on observable market data
The management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
11 Financial risk management objectives and policies
The Company's principal financial liabilities, other than derivatives, comprise loans and 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 include loans, trade and other receivables, and cash and cash equivalents that are derived directly from its operations.
The Company's financial risk management is an integral part of how to plan and execute its business strategies. The Company is exposed to market risk, credit risk and liquidity risk.
The Company's senior management oversees the management of these risks. The senior professionals working to manage the financial risks and the appropriate financial risk governance framework for the Company are accountable to the Board of Directors and Audit Committee. This process provides assurance to Company's senior management that the Company's financial risktaking activities are governed by appropriate policies and procedures and that financial risk are identified, measured and managed in accordance with Company policies and Company risk objective.
The Board of Directors reviews and agrees policies for managing each of these risks which are summarized as below:
(a) Market Risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprises three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity price risk. Financial instruments affected by market risks include loans and borrowings, deposits, investments, and foreign currency receivables and payables. The sensitivity analysis in the following sections relate to the position as at March 31, 2024. The analysis exclude the impact of movements in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions; and the non-financial assets and liabilities. The sensitivity of the relevant Profit and Loss item is the effect of the assumed changes in the respective market risks. This is based on the financial assets and financial liabilities held as of March 31, 2024.
(i) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company's exposure to the risk of changes in foreign exchange rates relates primarily to the Company's operating activities (when revenue or expense is denominated in foreign currency). Foreign currency exchange rate exposure is partly balanced by purchasing of goods from the respective countries. The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established risk management policies.
Foreign currency risk sensitivity
The following tables demonstrate the sensitivity to a reasonably possible change in USD, AED & Euro exchange rates, with all other variables held constant. The impact on the Company profit before tax is due to changes in the fair value of monetary assets and liabilities. Foreign currency exposures recognised by the Company that have not been hedged by a derivative instrument or otherwise are as under:
The Company is exposed to the risk of price fluctuation of raw material as well as finished goods. The Company manages its commodity price risk by maintaining adequate inventory of raw materials and finished goods considering future price movement. To counter raw material risk, the Company works with various suppliers working in domestic and international market with the objective to moderate raw material cost, enhance application flexibility and increased product functionality and also invests in product development and innovation. To counter finished goods risk, the Company deals with wide range of vendors and manages these risks through inventory management and proactive vendor development practices. The Company also passes on the Commodity price hike in case of several customers when Company have fixed price contracts. Fixed price contracts are enetered into after due consideration of the Commodity price volatility during the delivery / contract period.
(b) Credit Risk
Credit Risk is the risk that the counter party will not meet its obligation 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 financing activities, including deposits with banks, foreign exchange transactions and other financial instruments.
(i) Trade Receivables
Customer credit risk is managed by each business unit subject to the Company's established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored. Out of that, the Company has 10 customers that owed the Company approx. Rs. 2687.41 lakhs (March 31, 2023: Rs. 1510.98 lakhs) and accounted for 68.40 % (March 31, 2023: 45.88%) of total trade receivables.
An impairment analysis is performed at each reporting date on trade receivables by lifetime expected credit loss method based on provision matrix. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets..
(ii) Financial instruments and cash deposits
Credit risk from balances with banks and financial institutions is managed by the Company's treasury department in accordance with the Company's policy. Investments of surplus funds are made in bank deposits and other risk free securities. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty's potential failure to make payments.
The Company's maximum exposure to credit risk for the components of the balance sheet at 31 March 2024 is the carrying amounts. The Company's maximum exposure relating to financial instrument is noted in liquidity table below.
Trade Receivables and other financial assets are written off when there is no reasonable expectation of recovery, such as debtor failing to engage in the repayment plan with the Company.
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's objective is to at all times maintain optimum levels of liquidity to meet its cash and liquidity requirements. The Company closely monitors its liquidity position and deploys a robust cash management system. It maintains adequate source of financing through the use of short term bank deposits and cash credit facility. Processes and policies related to such risks are overseen by senior management. Management monitors the Company's liquidity position through rolling forecasts on the basis of expected cash flows. The Company assessed the concentration of risk with respect to its debt and concluded it to below: Maturity profile of financial liabilities
The table below provides the details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.
13 Capital Management
For the purposes of Company's capital management, Capital includes equity attributable to the equity holders of the Company and all other equity reserves. The primary objective of the Company's capital management is to ensure that it maintains an efficient capital structure and maximize shareholder value. The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders or issue new shares. The Company is not subject to any externally imposed capital requirements. No changes were made in the objectives, policies or processes for managing capital during the year ended March 31, 2023 and March 31, 2024.
17 Additional regulatory information required by Schedule III of Companies Act,2013
(i) Details of Benami Properties: No proceedings have been initiated or are pending against the company for holding any Benami property under the Benami Trasactions (prohibition) Act,1988 (45 of 1988) and the rules made thereunder.
(ii) Utilization of borrowed funds and share premium:
The Company has not advanced or loaned or invested funds to any person(s) or entity(ies), including foreign entitites (intermediaries) with the understanding that the 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 to or on behalf of the ultimate beneficiaries.
(iii) Compliance with number of layers of Companies: The Company has complied with the number of layers as prescribed under
the Companies Act,2013.
(iv) Undisclosed Income: There is no income undisclosed or surrendered as income during the current or previous year in the tax assessments under the Income Tax Act,1961, that has not recorded in the books of accounts.
(v) Crypto Currency or Virtual Currency: The company has not traded or invested in crypto currency or virtual currency during the current or previous year.
(vi) Valuations of PPE, Intangible assets :The company has not revalued its property, plant and equipment or intangible assets or both during the current or previous year.
(vii) The Company has not granted any loans or advances in the nature of loans repayable on demand.
18 Amounts in the financial statements are presented in Indian Rupees in lacs rounded off to two decimal places as permitted by
Schedule III to the Companies Act, 2013. Per share data are presented in Indian Rupees to two decimals places.
19 Note No. 1 to 31 form integral part of the balance sheet and statement of profit and loss.
The accompanying notes are an integral part of the financial statements.
As per our report of even date
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