(ii) Terms and rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The final dividend, if any, proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim divdend. 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.

Secured borrowings and assets mortgaged/ hypothecated as security

(a) All secured borrowings are secured by mortgage of assets and hypothecation of vehicles

(b) The carrying amounts of financial and non-financial assets mortgaged/ hypothecated as security for current and non-current borrowings are disclosed in note 33.

(c) Working Capital Loan availed to meet the Liquidity mismatch arising out of Covid-19 out-break.

(d) Term Loans were used fully for the purpose for which the same were obtained.

(e) The Company is adequately submitting monthly statements of current assets to the banks which are as per the books of accounts maintained by the company.

$ Provision for Powder Factor Deduction

a) The provision for powder factor deduction is due to non achievement of the required performance of the product. The provision is based on estimates made from technical evaluation and historical data associated with similar services.

b) The Company's main clients are PSUs where in Powder Factor deduction is determined after a substantial period of time, the consequential claims and counterclaims on performance bonus/deductions affect the trade receivables on account of which the substantial part of balances outstanding as trade receivables are not confirmed by them. However, the management is confident that such receivables are stated at their realizable value and adequate provisions are made in the accounts, wherever required.

Provision for warranties

Letter received from M/s. Manganese Ore India Limited towards risk purchase with holding of Rs.63.78 lakhs, against which Rs.44.33 lacs has been provided under Expected Credit Loss and Rs. 19.45 lakhs provided under Claims & Warrianties, which is on account of non supply of Explosives to M/s. Manganese Ore India Limited. This contract is for 1 year from 1st July 22 till 30th June 23. If the Company would have supplied the quantity as per Contract then the Company would have met with a loss of Rs.154 lakhs.

Provision for employee benefits

(i) Other Long Term Employee Benefits Compensated Absences

The Compensated Absences cover the company's liability for earned leave.

The amount of the provision of Rs. 77.31 Lakhs (PY Rs. 48.37 Lakhs) is presented as current, since the company does not have an unconditional right to defer settlement for any of these obligations. However, based on past experience, the Company does not expect all employees to take the full amount of accrued leave or require payment within the next 12 months. The following amounts reflect leave that is expected to be taken or paid within the next 12 months.

(ii) Post-employment benefit plans Gratuity

The company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of completed years of service. The gratuity plan is a partly funded plan and the company makes contributions to Insurer managed funds in India. The company does not fully fund the liability.

(iii) Defined Contribution plans

The company also has certain defined contribution plans. Contributions are made to provident fund, Employers Contribution to Employees' State Insurance & super annuation schemes in India for employees. The Provident Fund and the State defined Contribution plans are operated by the Regional Provident Fund Commissioner and the Superannuation Fund is funded to LIC of India. The obligation of the company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognised during the period towards defined contribution plan is Rs. 255.32 Lakhs (PY Rs. 225.15 Lakhs).

Sensitivity analysis is determined based on the expected movement in liability if the assumptions were not proved to be true on different count.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.

Employee benefit obligations

Employee benefit obligations Risk exposure

The defined benefit plans expose the company to actuarial risk, such as longevity risk, interest rate risk and market (investment) risk. Specific class of employees are covered by the Company for the purpose of Gratuity obligations by investing in group gratuity scheme of LIC of India and for rest of the employees, through not covered by funded obligation, liability has been created based on acturial valuation. In case of employees at one of the unit the liability is based on Management's estimate amounting to Rs.54.37 lacs.

(iv) Employer Contributions

Expected contributions to post-employment benefit plans for the year ending 31st March, 2024 are Rs.35 Lakhs.

The weighted average duration of the defined benefit obligation is 5.01 years (2023 - 6.14 years) for employees who are covered under group gratuity scheme of LIC of India and 5.96 years (2023 - 6.75 years) for employees who are not covered by group gratuity scheme of LIC of India

“The company's activities expose it to market risk, liquidity risk and credit risk. Market risk is the risk of loss of future earnings, fair value or future cashflows that may result from a change in the price of the financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency receivable and payables and loans and borrowings.”

If the risk exposure is significant then senior management reviews the position and takes decision regarding hedging/other risk strategies to mitigate such risk exposures.

(i) 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 the market interest rate. The company is not exposed to significant interest rate risk as at the respective reporting dates.

(ii) Foreign currency risk:

The Company is exposed to foreign exchange risk through its sales and services in overseas and purchases from overseas suppliers in various foreign currencies. The Company transacts business in foreign currencies (primarily USD and Eur). Consequently, the Company has foreign currency trade payables and receivables and is therefore exposed to foreign exchange risk.These exposures are unhedged.

(iii) Credit Risk: Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial conditions, current economic trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.

The company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the company compares the risk of a default occuring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers reasonable and supportive forwarding -looking information such as :

(i) Actual or expected significant adverse change in business

(ii) Actual or expected significant change in the operating results of the counterparty

(iii) Financial or economic conditions that are expected to cause a significant change to the counterparty's ability to meet its obligation.

(iv) Significant increases in credit risk on other financial instruments of the same counterparty

A default on a financial asset is when the counterparty fails to make contractual payments within 1095 days of when they fall due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.

Financial assets are written off when there is no reasonable expectation of recovery. Where loans or receivables have been written off, the Company may engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognised in profit or loss.

(iv) Trade Receivables & Other Receivables :

Customer credit is managed by each business un subject to company's established policies, procedures and control relating to customer creit risk management. Trade Receivables are non interest bearing and are generally on 60 days credit term. An impairment analysis is performed at each reporting date on an individual basis for major clients.

The Company measures the Expected Credit Loss of Trade Receivables based on historical trend, Industry Practices and the business environment in which the entity operates. Loss rates are based on actual credit loss experience and past trends.Expected credit loss is computed on a collective basis as receivables are in similar category & amount of individual trade receivables are not individually significant except those as disclosed in Note 5C

Based on management estimation and data available there is no significant increase in credit risk/credit impaired for individual trade receivables except those disclose in note 5C.

In computation of the expected credit loss, there is no specific provisioning / write off policy for outstanding for more than certain period. There are no specific forward looking information estimated by the management.

The ageing analysis of the receivables (gross of provision) has been considered from the date the invoice falls due.

For the purposes of the Company's capital management, capital includes issued capital and all other equity reserves. The primary objective of the Company's Capital Management is to maximise shareholder value. The company manages its capital structure and makes adjustments in the light of changes in economic environment and the requirements of the financial statements

An operating segment is a component of the entity that engages in business activities from which it may earn revenue and incur expenses, including revenue & expenses that relate to transactions with any of the company's other components, and for which discrete financial information is available. All operating segments are evaluated based on profit or loss and measured consistently with the profit or loss in the financial statements & are reviewed regularly by the entity's Managing Director to make decisions about resorces to be allocated to the segments and access their performance.

For management purposes, the Company is organised into business units based on its products and services and has 2 reportable segment as follows:-

1) Explosives segment which manufactures cartridge explosives, bulk emulsion explosives.

2) Perlite segment which manufactures cryogenic insulation, industrial filter-aid, horticulture products etc.,

(i) Disputed demand in respect of Service tax at vishwasnagar amounting to Rs.39.42 lacs has been accepted by the Company and the same is adjusted against the deposit kept with the Service tax department.

ii) Disputed demand in respect of Central sales tax in Maharashtra for the year 2008-09. Amount aggregating Rs.3 Lakhs (PY Rs. 3 Lakhs) is paid under protest against such demand.

iii) Based on the inquiry conducted by Directorate of Revenue Intelligence (‘DRI'), the company has paid antidumping duty along with interest on import of ammonium nitrate by one of the suppliers of the company between FY 2017-2019 which has been shown in the Financial Year 2020-21 as exceptional item. Further the Company has received show cause notice from DRI of Rs.56.81 lakhs in FY 2022-23 and the company has suitabilly repiled on the same. Further, the company is exploring its options including legal notice on the supplier from whom the imports were made

iv) Disputed demand of income tax for the assessment year 2015-16, 2016-17, 2017-18, 2018-19 & 2019-2020. Amount aggregating Rs.36.98 Lakhs (PY Rs.36.98 Lakhs) is paid under protest against such demand.

v) Letter of credits and bank guarantees issued to suppliers/customers

Note: a) The company has process in place to identify the impacts of the ongoing litigations on the Financial Statments.

b) The company does not have any long term contract (including Derivatives) on which there would be forseeable losses.

Note 31: Capital Commitments:

Capital expenditure contracted for at the end of the reporting period but not recognised as liabilities is as follows:

Note:

The company does not have any long term contract (including Derivatives) on which there would be forseeable losses. Note 32: Earnings per share

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the Company by the weighted average number of Equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of Equity shares outstanding during the year and are adjusted for the effect of all dilutive potential equity shares.

v Revenue recognised from Contract liability (Advances from Customers)

The Contract liability outstanding at the beginning of the year has been recognised as revenue during the year ended 31st March, 2023 and 31st March, 2024.

vi Trade receivables are non-interest bearing and are generally on 60 days credit term. On 31st March, 2024 Rs.96.42 lakhs (31st March, 2023: Rs. 83.93 lakhs) was recognised as provision for expected credit losses on trade receivables. Credit limits are established for all customers based on internal rating criteria. Outstanding customer receivables are regularly monitored.

*Note: In the absence of purchase price of share held by above Companies, Face value is considered for reporting purpose

Note 37: The disclosure on the following matters required under Schedule III as amended not being relevant or applicable

in case of the Company, same are not covered such as

a) The Company has not traded or invested in crypto currency or virtual currency during the financial year.

b) There are no transaction which have not been recorded in the books that has been surrendered or disclosed as income during the year in the tax assessments under Income Tax Act, 1961 (such as search or survey or any other relevant provisions of the Income Tax Act, 1961).

c) No proceedings have been intiated or are pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made there under.

d) The Company has not been declared willful defaulter by any bank or financial institution or government or any government authority.

e) The Company has not entered into any scheme of arrangement.

f) No Registration or satisfaction of charges are pending to be filed with Register of Companies (ROC).

g) The provision relating to compliance with number of layers of Companies prescribed under clause (87) of section 2 of the Companies Act is not applicable to the Company.

Note 38: (a) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend to or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(b) No funds have been received by the Company from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend to or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(1) Net Profit after taxes Non Cash Operating Expenses Interest Other Adjustments like loss on sale of assets

(2) Intsalments made for borrowings and lease liabilities along with interest

Note 41: The financial statements were authorised for issue by Board of Directors at their meeting held on 14th May, 2024.