U. PROVISIONS, CONTINGENT LIABILITIES AND
CONTINGENT ASSETS

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

The amount recognised as a provision is the best estimate
of the consideration required to settle the present
obligation at the reporting date, taking into account the
risks and uncertainties surrounding the obligation. Where
a provision is measured using the cash flows estimated to
settle the present obligation, its carrying amount is the

present value of those cash flows (when the effect of the
time value of money is material).

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

Warranties

Provisions of the expected cost of warranty obligations
under local sale of goods legislation are recognised at
the date of sale of the relevant products, at the director''s
best estimate of the expenditure required to settle the
Company''s obligation.

Onerous Contracts

Present obligations arising under onerous contracts are
recognised and measured as provisions. An onerous
contract is considered to exist where the company has a
contract under which the unavoidable costs of meeting
the obligations under the contract exceed the economic
benefits expected to be received under it. Estimates are
regularly reviewed and adjusted as appropriate for new
circumstances.

Restoration Provisions

Provisions for the costs to restore leased plant assets
to their original condition, as required by the terms
and conditions of the lease, are recognised when the
obligation is incurred, either at the commencement date
or as a consequence of having used the underlying asset
during a particular period of the lease, at the director''s is
best estimate of the expenditure that would be required
to restore the assets.

Contingent Liabilities

A contingent liability is disclosed in respect of a possible
obligation that arise from past events whose existence will
be confirmed only on the occurrence or non-occurrence
of one or more uncertain future events not wholly within
the control of the Company or from a present obligation
that arises from past events which are not recognised
because:

i. it is not probable that an outflow of resources
embodying economic benefits will be required to
settle the obligation; or

ii. the amount of the obligation cannot be measured
with sufficient reliability.

Contingent Assets

Contingent assets are not recognised but only disclosed
when an estimate of the financial effect thereof can be
measured. Contingent assets are possible assets that arise
from past events whose existence will be confirmed only
by the occurrence of one or more uncertain future events
not wholly within control of the Company.

V. NON-CURRENT ASSETS HELD FOR SALE:

Non-current assets and disposal group are classified under
''Held for Sale'' if their carrying amount is intended to be
recovered principally through sale rather than through
continuing use. The condition for classification of ''Held for
Sale'' is met when the non-current assets is available for
immediate sale and the same is highly probable of being
completed within one year from the date of classification
under ''Held for Sale''. Non-current assets held for sale
are measured at the lower of carrying amount and fair
value less cost to sell. Non-current assets those ceases
to be classified under ''Held for Sale'' shall be measured
at the lower of carrying amount before the non-current
asset and disposal group was classified under ''Held for
Sale'' adjusted for any depreciation / amortization and its
recoverable amount at the date when the disposal group
no longer meets the ''Held for Sale'' criteria.

W. EARNINGS PER SHARE

Basic EPS is computed by dividing the net profit
attributable to shareholders by the weighted average
number of equity shares outstanding during the year.

Diluted EPS is computed using the weighted average
number of equity and dilutive equity equivalent shares
outstanding during the year-end, except where the results
would be anti-dilutive.

x. dividend

Final dividend on shares is recorded as a liability on the
date of approval by the shareholders and interim dividends
are recorded as a liability on the date of declaration by the
Company''s Board of Directors.

Y. OTHER MATTERS

Ministry of Corporate Affairs ("MCA") notifies new
standards or amendments to the existing standards under

Companies (Indian Accounting Standards) Rules as issued
from time to time. For the year ended March 31, 2026,
MCA has not notified any new standards or amendments
to the existing standards applicable to the Company.

4. Critical accounting judgement and key sources
of estimation uncertainty

In applying the Company''s accounting policies, which are
described in note 3, the directors are required to make
judgements (other than those involving estimations)
that have a significant impact on the amounts
recognised and to make estimates and assumptions
about the carrying amounts of assets and liabilities
that are not readily apparent from other sources. The
estimates and associated assumptions are based on
historical experience and after considering the impact
of macroeconomic factors including geo-political factors
that are considered to be relevant. Actual results may
differ from these estimates.

The estimates and underlying assumptions are reviewed
on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is
revised if the revision effects only that period, or in the
period of the revision and future periods if the revision
affects both current and future periods.

Critical judgements in applying the Company''s
accounting policies

The following are the critical judgments, apart from those
involving estimations (which are presented separately
below), that the directors have made in the process of
applying the Company''s accounting policies and that have
the most significant effect on the amounts recognised in
financial statements.

i. Business model assessment

Classification and measurement of financial assets
depend on the results of the SPPI (Sole Payment of
Principal and Interest) and the business model test. The
Company determines the business model at a level that
reflects how groups of financial assets are managed
together to achieve a particular business objective. This
assessment includes judgement reflecting all relevant
evidence including how the performance of the asset
is evaluated and their performance measured, the risks
that affect the performance of the assets and how these
are managed and how the managers of the assets are

compensated. The Company monitors financial assets
measured at amortised cost or fair value through other
comprehensive income that are derecognised prior to
their maturity to understand the reason for their disposal
and whether the reasons are consistent with the objective
of the business for which the asset was held. Monitoring is
part of the Company''s continuous assessment of whether
the business model for which the remaining financial
assets are held continues to be appropriate and if it is not
appropriate, whether there has been a change in business
model and so a prospective change to the classification of
those assets. No such changes were required during the
periods presented.

ii. Significant increase in credit risk

ECL are measured as an allowance equal to 12-month
ECL for stage 1 assets, or lifetime ECL for stage 2 or stage
3 assets. An asset moves to stage 2 when its credit risk
has increased significantly since initial recognition. Ind
AS 109 does not define what constitutes a significant
increase in credit risk. In assessing whether the credit risk
of an asset has significantly increased, the Company takes
into account qualitative and quantitative reasonable and
supportable forward-looking information.

Key sources of estimation uncertainty:

The key assumptions concerning the future, and other key
sources of estimation uncertainty at the reporting period,
that may have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities
within the next financial year, are discussed below.

i. Taxation Provisions

Significant judgments are involved in determining
the provision for income taxes, including amount
expected to be paid/recovered for uncertain tax
positions. The Company''s Current tax provision
relates to management''s assessment of the
amount of tax payable on open tax positions
where the liabilities remain to be agreed with
the income tax authorities. Uncertain tax items
for which a provision is taken relates principally
to the interpretation of tax legislation regarding
arrangements entered into by the Company. Due
to the uncertainty associated with such tax items,
there is a possibility that, on conclusion of open
tax matters at a future rate, the final outcome may
differ significantly.

ii. Calculation of Loss Allowance

When measuring ECL the Company uses reasonable
and supportable forward- looking information, which
is based on assumptions for the future movement of
different economic drivers and how these drivers will
affect each other. Expected credit loss model is used
to arrive at the loss allowances. Expected loss rates
are based on average computed default rate based
on historical analysis of trade receivables.

Loss given default is an estimate of the loss arising
on default. It is based on the difference between
the contractual cash flows due and those that the
lender would expect to receive, taking into account
cash flows from collaterals and integral credit
enhancements.

Probability of default constitutes a key input in
measuring ECL. Probability of default is an estimate
of the likelihood of default over a given time horizon,
the calculation of which includes historical data,
assumptions and expectations of future conditions.

iii. Discount rate used to determine the carrying
amount of the Company''s defined benefit
obligation

The Company''s net obligation in respect of the
gratuity benefit scheme is calculated by estimating
the amount of future benefit that employees have
earned in return for their service in the current and
prior periods; that benefit is discounted to determine
its present value, and the fair value of any plan assets
is deducted. Information about assumptions and
estimation uncertainties in respect of defined benefit
obligation are disclosed in note 30.

The determination of the Company''s defined benefit
obligation depends on certain assumptions, which
includes selection of the discount rate. The discount
rate is set by reference to market yields at the end of
the reporting period on market yields by reference
to government bonds. This assumption is considered
to be a key source of estimation uncertainty as
relatively small change in the assumption used may
have a significant effect on the Company''s financial
statements within the next year. Further information
on the carrying amount of the company''s defined
benefit obligation and the sensitivity of those

amounts to changes in discount rate are provided in
note 30.

iv. Non-current assets held for sale

Assets held for sale are measured at the lower of
carrying amount or fair value less costs to sell. The
determination of fair value less costs to sell includes
use of the Management''s estimates and assumptions.
The fair value of the assets held for sale has been
estimated using valuation techniques (including
-market approach) which include unobservable
inputs.

v. Warranty Provision

A provision is estimated for expected warranty
claims in respect of products sold during the year
on the basis of past experience regarding failure
trends of products and costs of rectification or
replacement.

vi. Impairment testing

Goodwill is tested for impairment on an annual
basis and whenever there is an indication that the
recoverable amount of a cash generating unit is
less than its carrying amount based on a number
of factors including operating results, business
plans, future cash flows and economic conditions.
The recoverable amount of cash generating units is
determined based on higher of value-in-use and fair
value less cost to sell. The goodwill impairment test
is performed at the level of the cash-generating unit.
Market related information and estimates are used to
determine the recoverable amount. Key assumptions
on which management has based its determination
of recoverable amount include estimated long-term
growth rates, weighted average cost of capital and
estimated operating margins. Cash flow projections
consider past experience and represent management''s
best estimate about future developments.

NOTES:

1) The Company''s lease assets primarily consist of leases for land and material handling equipments.Finance cost accrued during
the year is included under Finance costs in the Statement of Profit and Loss.

2) The aggregate depreciation expense on ROU assets is included under depreciation and amortization expense in the Statement
of Profit and loss.

3) The total cash outflow for the leases amounted to '' 41.88 Lakhs.

The average credit period on sales of goods is 45 - 60 days. Interest is charged below 30 days @12% and above 30 days
@15% on overdue receivables from dealer, however no interest is charged on outstanding trade receivables (Other than
dealer).

The Company always measures the loss allowance for trade receivables at an amount equal to lifetime expected credit loss.
The expected credit losses on trade receivables are estimated using a provision matrix by reference to past default experience
of the debtor and an analysis of the debtor''s current financial position, adjusted for factors that are specific to the debtors,
general economic conditions of the industry in which the debtors operate, and an assessment of both the current as well
as the forecast direction of conditions at the reporting date. Outstanding customer receivables are reviewed periodically.
Provision is made based on expected credit loss method or specific identification method.

The Company writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty
and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation or has entered into
bankruptcy proceedings, or when the trade receivables are over 180 days past due, whichever occurs earlier. None of the
trade receivables are subject to enforcement activities.

(ii) (a) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having a par value of '' 5 per share. Each holder of equity shares is entitled to
one vote per share. The Company declares and pays dividends in Indian Rupees. The dividend, if any, proposed by the Board
of Directors is subject to the approval of the shareholders at the ensuing Annual General Meeting.

Note: Pursuant to the acquisition of the Company by Foseco India Limited with effect from 12 November 2025, Foseco India
Limited has become the holding company of Foseco Crucible (India) Limited (FCIL) formerly known as Morganite Crucible
(India) Limited.

Foseco India Limited acquired 99,081 shares through a mandatory public offer, increasing its shareholding to 76.77% of the
total equity share capital.(Refer Note 39).

Except for the change in shareholding and control, there are no changes in the rights, preferences, or restrictions attached to
the equity shares of the Company.

In the event of liquidation of the Company, the holders of equity shares shall be entitled to receive the remaining assets of the
Company, after distribution of all preferential amounts, in proportion to the number of equity shares held by them.

The Company manages its capital to ensure that it is able to continue as a going concern while maximizing returns to
stakeholders through optimization of its equity structure. The Company is not subject to any externally imposed capital
requirements.

Note :

(A) The Company has not issued any bonus shares in 5 years immediately preceding the year ended March 31, 2026.

(B) There were no shares bought back during five years immediately preceding the year ended March 31, 2026.

(C) There are no shares reserved for issue under options.

b) General reserve : The General reserve comprises of transfer of profits from retained earnings for appropriation purposes.
The reserve can be distributed/utilized by the Company in accordance with the Companies Act, 2013.

The general reserve is used from time to time to transfer profits from retained earnings for appropriation purposes.
There is no policy of regular transfer. As the general reserve is created by a transfer from one component of equity to
another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified
subsequently to profit or loss.

c) Capital reserve : Capital reserve comprises of receipt of Central Government investment subsidy under ''1993 package
scheme of incentives'', State government investment subsidy under ''1983 package scheme of incentives and capital
reserve arising on amalgamation of Diamond Crucible Company Limited.

d) Capital profit on forfeited shares - The capital profit on forfeited shares comprises of profit on re-issue of forfeited
shares.

e) Statutory Reserve : The statutory reserves comprises of the Investment allowance reserve created under the Income tax
Act, 1961.

The amount that can be distributed as dividend by the company to its equity shareholders is determined based on the separate
financial statements of the company and considering the requirements of the Companies Act, 2013. Thus, the amounts
reported above are not distributable in entirety.

On 14 August 2025 final dividend for FY 2024-25 of '' 19/- per share (total dividend '' 1064 lakhs) was paid to holders of fully
paid equity shares.

In respect of the current year, the directors proposed that a dividend of '' 12.50 per share be paid on equity shares. The equity
dividend is subject to approval by shareholders at the annual general meeting and has not been included as a liability in these
financial statements. The total estimated equity dividend to be paid is '' 700 Lakhs.

1. The Government of India has consolidated 29 existing labour legislations into a unified framework comprising four labour
codes viz the Code on Wages, 2019, the Code on Social Security, 2020, the Industrial Relations Code, 2020, and the
Occupational Safety, Health and Working Conditions Code, 2020 (collectively referred to as the "Codes"). The Codes have
been made effective from 21 November, 2025. The Ministry of Labour & Employment published draft Central Rules and FAQs
to enable assessment of the financial impact due to changes in regulations.

The incremental impact of these changes, assessed by the Company, on the basis of the information available, consistent with
the guidance provided by the Institute of Chartered Accountants of India, is '' 36.89 lakhs for Gratuity and '' 24.47 lakhs for
Leave Encashment has been recognised as exceptional item i n the results of the Company for the quarter and year ended 31
March, 2026 respectively.

Once Central / State Rules are notified by the Government on all aspects of the Codes, the Company will evaluate impact, if
any, on the measurement of employee benefits and would provide appropriate accounting treatment.

2. ''In 2023, the Company commenced a project to develop a product line for a new market and made certain investments as
part of this project. Subsequent to the acquisition of the Company, by Foseco India Limited (FIL) during the year, this project
was suspended. As a result, the project related assets have been assessed for impairment and written down to recoverable
value. Accordingly, an impairment loss of '' 1,806.20 lakhs has been recognized in the statement of profit and loss and
disclosed as an exceptional item, in accordance with the applicable provisions of Ind AS.

Note: the Company does not have outstanding diluted potential Equity shares. Consequently, the basic and diluted earnings
per share of the Company remain the same.

30 Provision for Compensated Absences and Gratuity

The Government of India has announced the implementation of the four Labour Codes - the Code on Wages, 2019,
the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the Occupational Safety, Health and Working
Conditions Code, 2020 with effect from 21^st November, 2025, rationalising 29 existing labour laws.

The Ministry of Labour & Employment published draft Central Rules and FAQs to enable assessment of the financial impact
due to changes in regulations.

The Company has assessed the impact of these changes, the liability as per new labour code is in line with the provision
recognised in books of account as per existing Company policy. The Company continues to monitor the finalization of Central
/ State Rules and clarifications from the Government on other aspects of the Labour Code and will align policies/pay structure.

a. Long term employee benefit obligations
Compensated absences

The leave obligations cover the Company''s liability for earned leave which is classified as other long-term benefits.

ii. Gratuity

In accordance with applicable Indian laws, the Company provides for gratuity, a defined benefit retirement plan (Gratuity
Scheme) covering certain categories of employees. The Gratuity Scheme provides a lump sum payment to vested employees,
at retirement or termination of employment, an amount based on the respective employee''s last drawn salary and the years
of employment with the Company. The Company provides the gratuity benefit through annual contributions to the fund
managed by the Life Insurance Corporation of India (LIC) through Foseco Crucible (India) Limited Gratuity Fund, under this
plan the settlement obligation remains with the Company. The Company funds the liability based on estimations of expected
gratuity valuation provided by the Actuary.

The above sensitivity analysis is 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 benefit
obligation calculated with the projected unit credit method) has been applied as when calculating the defined benefit liability
recognized in the balance sheet.

VII. Risk Exposure

Through its defined benefit plan, the Company 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. All plan assets are maintained in a trust fund managed by a public sector insurer i.e., LIC of India. LIC
has a sovereign guarantee and has been providing consistent and competitive returns over the years. The Company has opted
for a traditional fund wherein all assets are invested primarily in risk averse markets. The Company has no control over the
management of funds but this option provides a high level of safety for the total corpus. A single account is maintained for both
the investment and claim settlement and hence, 100% liquidity is ensured. Also, interest rate and inflation risk are taken care of.

Changes in bond yields

A decrease in bond yields will increase plan liabilities, although this will be partially offset by an increase in yield in the value
of the plans'' bond holdings.

Future salary escalation and inflation risk

Since price inflation and salary growth are linked economically, they are combined for disclosure purposes. Rising salaries will
often result in higher future defined benefit payments resulting in higher present value of liabilities. Further, unexpected salary
increases provided at the discretion of the management may lead to uncertainties in estimating this increasing risk.

Asset-Liability mismatch risk

Risk which arises if there is a mismatch in the duration of the assets relative to the liabilities. By matching duration with the
defined benefit liabilities, the Company is successfully able to neutralize valuation swings caused by interest rate movements
as it has adopted asset-liability management approach.

32 Segment Reporting

(a) Description of segments and principal activities

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief operating
decision maker. The Managing Director has been identified as the Chief Operating Decision Maker (CODM).

The Company recognizes its sale of crucibles activity as its only primary business segment since its operations
predominantly consist of manufacture and sale of crucibles to its customers. The ''Chief Operating Decision Maker''
monitors the operating results of the Company''s business as single segment. Accordingly in context of Ind AS "Operating
Segments" the principle business of the Company constitute a single reportable segment. Accordingly, income from sale
of crucibles comprises the primary basis of segmental information set out in these financial statements.

b) Geographical segments:

The geographical information analyses the Company''s revenues and assets by the Company''s country of domicile (i.e.
India) and outside India presenting geographical information, segment revenue has been on the geographic location of
customers and segment assets which have been based on the geographical location of the assets.

c) Information about major customers:

The Company is domiciled in India, however also sells its products outside India. The amount of its revenue from external
customers broken down by the location of the customers is shown in table below :

B. Measurement of fair values

(i) Valuation techniques and significant unobservable inputs.

Level 1: Fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or
liabilities

Level 2: Fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)

Level 3: Fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that
is not based on observable market data (unobservable inputs).

(ii) Valuation techniques used to determine fair value

Specific valuation techniques used to value the financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments

- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.

(iii) Valuation processes

The finance team performs the valuation of financial assets and liabilities required for financial reporting purposes.

34 Financial Risk Management
1 Financial risk management

The Company''s activities exposes it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the
Company is exposed to and how the Company manages the risk.

(A) Credit risk

The Company is exposed to credit risk from its operating activities (primarily trade receivables) and deposits with banks
and other financial instruments. For banks and other financial institutions, only high rated banks/ financial institutions are
accepted. The balances with banks, loans given to employees, security deposits are subject to low credit risk and the risk
of default is negligible or nil. Hence, no provision has been created for expected credit loss for credit risk arising from these
financial assets. The Company considers the probability of default upon initial recognition of asset and whether there has
been a significant increase in the 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 occurring on the asset as at the reporting date
with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forward-looking
information, for e.g., external credit rating (to the extent available), actual or expected significant adverse changes in business,
financial or economic conditions that are expected to cause a significant change to borrower''s ability to meet its obligations
is credit risk.

I. Cash and bank balance

Credit risk from balances/ fixed deposits banks is managed in accordance with the Company''s risk management policy.
Investments of surplus funds are made only with approved counterparties and within limits assigned to each counterparty.
The limits are assigned based on corpus of investable surplus and corpus of the investment avenue. The limits are set to
minimize 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 on account of deposits with banks is as mentioned below -

II. Trade receivables

Credit risk arises from the possibility that customer will not be able to settle their obligations as and when agreed. To
manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial
conditions, current economic trends, analysis of historical bad debts, ageing of accounts receivable and forward looking
information. Individual credit limits are set accordingly.

The Company uses the Expected Credit Loss (ECL) model to assess the impairment gain or loss. As per ECL simplified
approach, the Company uses a provision matrix to compute the expected credit loss allowance for trade receivables. The
provision matrix takes into account a continuing credit evaluation of Company''s customers'' financial condition aging
of trade accounts receivable the value and adequacy of collateral received from the customers in certain circumstances
(if any) the Company''s historical loss experience and adjustment based on forward looking information. The Company
defines default as an event when there is no reasonable expectation of recovery.

Loss allowance on account of specific identification

Trade receivables provided for on the specific identification basis as of March 31, 2026 are '' 0.22 lakhs ( March 31, 2025
was '' 5.66 lakhs).

(B) Liquidity risk

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate
liquidity risk management framework for management of the company''s short, medium and long-term funding and liquidity
management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and
by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and
liabilities.

The Company''s principal sources of liquidity are cash and cash equivalents and cash flow that is generated from operations.
The Company has no outstanding bank borrowings. The Company believes that the current working capital is sufficient to
meet its current obligatory requirements. Accordingly, no liquidity risk is perceived.

(C) 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- such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or the
value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk
exposures within acceptable parameters, while optimizing the return. Market risk comprises of:

I. Interest rate risk

II. Foreign currency risk

Financial instruments affected by market risk include other financial assets, trade receivables and trade payables.

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
market interest rates. Since the Company does not have any financial instrument with variable interest rates, it is not exposed
to interest rate risk.

II) Foreign currency risk

The Company is engaged in international trade and thereby exposed to foreign exchange risk arising from foreign currency
transactions, primarily with respect to the USD, EUR, GBP and JPY. Foreign exchange risk arises from recognised assets and
liabilities denominated in a currency other than company''s functional currency (INR). The Company''s exposure to foreign
currency arises from short term receivables and payables where fluctuations in the foreign exchange rates are generally not
significant and consequently limiting the Company''s exposure.

III) Interest rate risk

The Company''s main interest rate risk arises from deposits placed over a period of time on frequent basis thereby exposing
the Company to interest rate risk. The Company''s policy is to have fixed interest rate at the time of deal execution.

IV) Price Risk

The Company does not have any financial assets or liabilities carried at fair value that are subject to market price risk. The
Company has investment in equity share of a listed Company (subsidiary company), this investment is carried at cost and does
carry any price risk.

V) Financial assets carried at fair value as at 31 March, 2026 is '' Nil and financial assets carried at amortized cost as at 31
March, 2026 is '' 6,434.73 lakhs. The Company has assessed the counterparty credit risk in connection with Cash and cash
equivalents, bank deposits and earmarked balances with banks amount to '' 3,693.70 lakhs as at 31 March, 2026 where the
Company has assessed the counterparty credit risk.

VI) Trade receivables amounting to '' 2,544.10 lakhs as at 31 March, 2026 is valued at considering provision for allowance under
the expected credit loss method. This assessment is based on the likelihood of the recoveries from the customers in the
present situation. The Company closely monitors its customers who are going through financial stress and assesses actions
such as change in payment terms, recognition of revenue on collection basis etc., depending on severity of each case.

Basis this assessment, the allowance for doubtful trade receivables is considered adequate.

Performance obligations

The Company satisfies its performance obligations pertaining to the sale of crucibles at point in time when the control of goods
is actually transferred to the customers. No significant judgment is involved in evaluating when a customer obtains control
of promised goods. The payment is generally due within 45-60 days. The Company is obliged for refunds due to shortages
during the mode of transportation. There are no other significant obligations attached in the contract with customer.

Transaction price

There is no remaining performance obligation for any contract for which revenue has been recognized till period end. Further,
the Company has not applied the practical expedient as specified in para 121 of Ind AS 115 as the Company do not have
any performance obligation that has an original expected duration of one year or less or any revenue stream in which
consideration from a customer corresponds directly with the value to the customer of the entity''s performance completed to
date.

Determining the timing of satisfaction of performance obligations

There are no significant judgements involved in ascertaining the timing of satisfaction of performance obligations, in evaluating
when a customer obtains control of promised goods, transaction price and allocation of it to the performance obligations.

Determining the transaction price and the amounts allocated to performance obligations

The transaction price ascertained for the only performance obligation of the Company (i.e. Sale of goods) is agreed in the
contract with the customer. There is no variable consideration involved in the transaction price except for refund due to
shortages which is adjusted with revenue.

37 Transfer Pricing

The Company has developed a comprehensive system of maintenance of information and documents as required by the
transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The management is of the opinion that its
international transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial
statements, particularly on the amount of tax expense and that of provision for taxation.

During the earlier years the Company has applied for Advance Pricing Agreement (APA) before the Central Board of Direct Tax
(CBDT) and Government of India for International Inter-company related party transactions with Associated Enterprises (AE).
The Company has entered into in APA agreement with CBDT dated 18 August, 2021 for 5 years ended 31 March, 2021.

The Company has also filed application for renewal of APA agreement for five years (FY 2021-22 to 2025-26) on 26 March
2021 and current tax working for FY 2024-25 is calculated based on the APA agreement signed on 18th August, 2021 for 5
years ended 31 March, 2021.

The Domestic Transfer Pricing Regulations as prescribed under section 92BA of the Income Tax Act, 1961 was introduced from
April 1, 2012. The Company has been consistently transacting with related parties on an Arm''s Length basis in accordance
with the Group Transfer Pricing Policy. The Company is of the opinion that there will be no significant changes to Arm''s length
price under determination in order to comply with the requirement of section 92BA of Income Tax Act. Hence, there will be
no material impact on the financial statements.

The Company tests goodwill for impairment at least annually, or more frequently if events or changes in circumstances
indicate that it might be impaired. The Company has identified a single cash generating unit ("CGU") based on the business.
The recoverable amount of CGU is determined based on higher of value-in-use and fair value less cost to sell. The recoverable
value was determined by value in use in cases where there is no basis for making a reliable estimate of the price at which
an orderly transaction to sell the asset would take place between market participants at the measurement date under
current market conditions. In determining the value in use, cash flow projections from financial budgets approved by senior
management have been considered.

Market related information and estimates are used to determine the recoverable amount. Key assumptions on which
management has based its determination of recoverable amount include estimated long-term growth rates, weighted
average cost of capital and estimated operating margins. Cash flow projections are considered for next 5 years
and consider past experience and represent management''s best estimate about future developments. Cash flows
beyond the five-year period are extrapolated using a 2% growth rate. The pre-tax discount rate applied to cash flow
projections for impairment testing during the current year is 12%. An analysis of the sensitivity of the computation of
recoverable amount to a change in key parameters, based on reasonable assumptions, did not identify any probable
scenario in which the recoverable amount of the CGU would decrease below its carrying amount other than the
amount.

39 On August 22, 2025, Morgan Advanced Materials plc, the ultimate holding company of Morganite Crucible (India) Ltd (MCIL),
entered into a Share Purchase Agreement (SPA) with Vesuvius Plc to divest its Molten Metal Systems (MMS) business, which
includes a 75% equity stake in MCIL for aggregate consideration of '' 65,394 lakhs.

The transaction has been executed through a share swap arrangement. As part of this deal, Foseco India Ltd (FIL), a
Vesuvius Group entity, has acquired 75% stake in MCIL from Morganite Crucible Ltd (UK) and Morgan Terrassen B.V.,
and in return, FIL has issued new equity shares to MCIL''s promoters under the share swap structure in the agreed
ratio.

FIL received in principle approvals from the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) on 3
November, 2025 and 4 November, 2025, respectively. Subsequently on 12 November, 2025, upon fulfillment of all terms and
conditions stipulated in the Share Purchase Agreement (SPA) dated 22 August, 2025, the Vesuvius Group, through Foseco
India Limited, acquired control over MCIL.

The acquisition triggered a Mandatory Tender Offer (MTO) under Regulations 3(1) and 4 of the SEBI (Substantial Acquisition
of Shares and Takeovers) Regulations. Following the completion of the MTO, FIL holds 76.77% of the issued share capital of
FCIL, meaning that the Company''s public shareholding has fallen below the statutory limit of 25%. FIL is in the process of
taking steps to return the public shareholding to 25%.

Following the acquisition Foseco Crucible (India) Limited applied for a change in name with the Ministry of Corporate Affairs
(MCA).

With effect from 9 February, 2026, Morganite Crucible (India) Limited has been renamed as Foseco Crucible (India) Limited,
as evidenced by the Certificate of Incorporation issued pursuant to the change of name.

The same certificate was submitted to the BSE, following which the Company''s name has also been updated in the BSE
records.

40 Other Information

a) The Company did not have any transactions with companies struck off under Section 248 of the Companies Act, 2013
or Section 560 of Companies Act, 1956 during the financial year.

b) The Company does not have any Benami property, where any proceedings have been initiated or are pending against
the Company for holding any Benami property.

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

d) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.

e) The Company have not advanced or loaned or invested funds (either from borrowed funds or share premium or any
other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the
understanding, whether recorded in writing or otherwise, that the Intermediary shall:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

f) The Company have 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:

(i) 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

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,

g) No direct database changes in accounting software are allowed and all data changes are governed at application layer
to avoid system performance problems and to follow the principle of data minimization. There are alternate governing
processes in place to mitigate any risk of unauthorized access to database.

h) The Company maintains its books of account in electronic form. For the period from 1 April, 2025 to 22 March, 2026,
daily backups were not maintained on a server physically located in India. With effect from 22 March, 2026, daily
backups are being maintained on a server that is physically located in India.

i) The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered
or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey).

The Company''s board of directors has overall responsibility for the establishment and oversight of the Company''s risk management
framework. The board of directors has established the risk management committee, which is responsible for developing and
monitoring the Company''s risk management policies. The committee reports regularly to the board of directors on its activities.
The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set
appropriate limits and controls and to monitor risks and adherence to limits. The Company, through its training and established
procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles
and obligations.

The nature of the Company''s business exposes it to a range of financial risks. These risks include:

(i) credit risk;

(ii) liquidity risk; and

(iii) market risk.

Credit risk refers to the risk that a counterpart will default on its contractual obligations resulting in financial loss to
the Company. As at March 31, 2025, the company''s maximum exposure to credit risk without taking into account any
collateral held or other credit enhancements which will cause a financial loss to the group due to failure to discharge an
obligation by the counterparties and financial guarantees provided by the company arises from the carrying amount of
the respective recognized financial assets as stated in the balance sheet.
a. Cash and bank balance

Credit risk from balances/ fixed deposits banks is managed in accordance with the Company''s risk management
policy. Investments of surplus funds are made only with approved counterparties and within limits assigned to each
counterparty. The limits are assigned based on corpus of investable surplus and corpus of the investment avenue.
The limits are set to minimize 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 on account of deposits with
banks is as mentioned below -

(ii) Liquidity risk:

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an
appropriate liquidity risk management framework for management of the company''s short, medium and long-term
funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves,
banking facilities and by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles
of financial assets and liabilities.

The Company''s principal sources of liquidity are cash and cash equivalents and cash flow that is generated from
operations. The Company has no outstanding bank borrowings. The Company believes that the current working capital
is sufficient to meet its current obligatory requirements. Accordingly, no liquidity risk is perceived.

As on 31 March 2025, the Company had a working capital of '' 4040.20 lakhs (as on 31 March 2024''5,735.03 lakhs)
including cash and cash equivalents and other bank balance of '' 2,198.07 lakhs (as on 31 March 2024''5,000.18 lakhs).
The working capital of the Company for this purpose has been derived as follows:

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- such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or
the value of its holdings of financial instruments. The objective of market risk management is to manage and control
market risk exposures within acceptable parameters, while optimizing the return.

Market risk comprises of:

a. Interest rate risk

b. Foreign currency risk

Financial instruments affected by market risk include other financial assets, trade receivables and trade payables.

a. 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. Since the Company does not have any financial instrument with variable interest
rates, it is not exposed to interest rate risk.

b. Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure 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 a foreign currency).
The foreign currency to which the Company is majorly exposed to are US Dollars, EURO and GBP.

The following tables demonstrate the sensitivity to a reasonably possible change in USD, EURO and GBP exchange
rates, with all other variables held constant -

Note 1

Financial assets carried at fair value as at 31 March 2025 is Rs. Nil and financial assets carried at amortized cost as at 31
March 2025 is Rs. 5,392.53 lakhs. The Company has assessed the counterparty credit risk in connection with Cash and cash
equivalents, bank deposits and earmarked balances with banks amount to Rs. 2,119.40 lakhs as at 31 March 2025 where the
Company has assessed the counterparty credit risk.

Trade receivables amounting to Rs. 3,124.08 lakhs as at 31 March 2025 is valued at considering provision for allowance
under the expected credit loss method. This assessment is based on the likelihood of the recoveries from the customers in the
present situation. The Company closely monitors its customers who are going through financial stress and assesses actions
such as change in payment terms, recognition of revenue on collection basis etc., depending on severity of each case.

Basis this assessment, the allowance for doubtful trade receivables is considered adequate.

Defined contributions plans

The Company makes contributions, determined as a specified percentage of employee salaries, in respect of qualifying
employees towards Provident Fund, Labour Welfare Fund and Superannuation Scheme, which are the defined contribution
plans. The Company has no obligations other than to make the specified contributions. The contributions are charged to the
Statement of Profit and Loss as they accrue. The amount recognized as an expense towards defined contribution plans for the
year for provident fund and superannuation scheme aggregated to '' 92.92 Lakhs (31 March 2024: '' 93.63 Lakhs).

defined benefit plans
Gratuity

The company sponsors defined benefit plans for qualifying employees. The defined benefit plans are administered by a
separate fund that is legally separated from the entity. The trustees of the pension fund are required by law to act in the
interest of the fund and of all relevant stakeholders in the plan. The trustees of the pension fund are responsible for the
investment policy with regard to the assets of the fund.

Under the plans, the employees are entitled to post-retirement yearly instalments amounting to 15 days salary for each year
of completed service at the time of retirement / exit. The scheme is funded by plan assets.

The most recent actuarial valuations of the planned assets and the present value of the defined benefit liability were carried
out at March 31, 2025 by appointed actuaries. The present value of the defined benefit liability, and the related current service
cost and past service cost, were measured using the projected unit credit method.

The following table summarizes the position of assets and obligations relating to the plan.

a) Gratuity is payable to all eligible employees of the Company on superannuation, death, and permanent disablement, in
terms of the provisions of the Payment of Gratuity Act, 1972.

b) The discount rate is based on the prevailing market yields Indian Government securities as at the Balance Sheet date for
the estimated term of the obligations.

c) The Company''s gratuity fund is managed by Life Insurance Corporation of India, details of those funds invested by LIC
are not readily available with the Company.

Performance obligations

The Company satisfies its performance obligations pertaining to the sale of crucibles at point in time when the control of
goods is actually transferred to the customers. No significant judgment is involved in evaluating when a customer obtains
control of promised goods. The payment is generally due within 45-60 days.

The Company is obliged for refunds due to shortages during the mode of transportation. There are no other significant
obligations attached in the contract with customer.

Transaction price

There is no remaining performance obligation for any contract for which revenue has been recognized till period end.
Further, the Company has not applied the practical expedient as specified in para 121 of Ind AS 115 as the Company do not
have any performance obligations that has an original expected duration of one year or less or any revenue stream in which
consideration from a customer corresponds directly with the value to the customer of the entity''s performance completed to
date.

Determining the timing of satisfaction of performance obligations

There is no significant judgements involved in ascertaining the timing of satisfaction of performance obligations, in
evaluating when a customer obtains control of promised goods, transaction price and allocation of it to the performance
obligations.

Determining the transaction price and the amounts allocated to performance obligations

The transaction price ascertained for the only performance obligation of the Company (i.e. Sale of goods) is agreed in the
contract with the customer. There is no variable consideration involved in the transaction price except for refund due to
shortages which is adjusted with revenue.

39. VOLUNTARY RETIREMENT SCHEME

During the year ended March 31, 2024, the Company had initiated the discussions with the workers for the Voluntary
Retirement Scheme (VRS). The Board of Directors in their meeting held on February 13, 2024 had approved the Voluntary
Retirement Scheme 2023-24 ("Scheme"). The Company had considered a provision of Rs. 321.08 lakhs and disclosed that as
an exceptional item in the Financial statements / results. 14 eligible employees opted for the scheme and their dues were paid
in April 2024.

The Company has developed a comprehensive system of maintenance of information and documents as required by the
transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The management is of the opinion that its
international transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial
statements, particularly on the amount of tax expense and that of provision for taxation.

During the earlier years the Company has applied for Advance Pricing Agreement (APA) before the Central Board of Direct Tax
(CBDT) and Government of India for International Inter-company related party transactions with Associated Enterprises (AE).
The Company has entered into in APA agreement with CBDT dated 18 August 2021 for 5 years ended 31 March 2021.

The Company has also filed application for renewal of APA agreement for five years (FY 2021-22 to 2025-26) on 26 March
2021 and current tax working for FY 2024-25 is calculated based on the APA agreement signed on 18th August 2021 for 5
years ended 31 March 2021.

The Domestic Transfer Pricing Regulations as prescribed under section 92BA of the Income Tax Act, 1961 was introduced from
April 1, 2012. The Company has been consistently transacting with related parties on an Arm''s Length basis in accordance
with the Group Transfer Pricing Policy. The Company is of the opinion that there will be no significant changes to Arm''s length
price under determination in order to comply with the requirement of section 92BA of Income Tax Act. Hence, there will be
no material impact on the financial statements.

The Company tests goodwill for impairment at least annually, or more frequently if events or changes in circumstances
indicate that it might be impaired. The Company has identified a single cash generating unit ("CGU") based on the business.
The recoverable amount of CGU is determined based on higher of value-in-use and fair value less cost to sell. The recoverable
value was determined by value in use in cases where there is no basis for making a reliable estimate of the price at which
an orderly transaction to sell the asset would take place between market participants at the measurement date under
current market conditions. In determining the value in use, cash flow projections from financial budgets approved by senior
management have been considered.

Market related information and estimates are used to determine the recoverable amount. Key assumptions on which
management has based its determination of recoverable amount include estimated long-term growth rates, weighted average
cost of capital and estimated operating margins. Cash flow projections are considered for next 5 years and consider past
experience and represent management''s best estimate about future developments. Cash flows beyond the five-year period
are extrapolated using a 2% growth rate. The pre-tax discount rate applied to cash flow projections for impairment testing
during the current year is 12%. An analysis of the sensitivity of the computation of recoverable amount to a change in key
parameters, based on reasonable assumptions, did not identify any probable scenario in which the recoverable amount of the
CGU would decrease below its carrying amount other than the amount.

42. The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment benefits
received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on
which the Code will come into effect has not been notified and the rules are yet to be framed. The Company will assess the
impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective
and the related rules are published.

43. OTHER INFORMATION

a) The Company did not have any transactions with companies struck off under Section 248 of the Companies Act, 2013
or Section 560 of Companies Act, 1956 during the financial year except as mentioned in Note 12.

b) The Company does not have any Benami property, where any proceedings have been initiated or are pending against the
Company for holding any Benami property.

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

d) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.

e) The Company have not advanced or loaned or invested funds (either from borrowed funds or share premium or any
other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the
understanding, whether recorded in writing or otherwise, that the Intermediary shall:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

f) The Company have 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:

(i) 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

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,

g) No direct database changes in accounting software are allowed and all data changes are governed at application layer
to avoid system performance problems and to follow the principle of data minimization. There are alternate governing
processes in place to mitigate any risk of unauthorized access to database.

h) The Company maintains the books of account electronically and its back-up is maintained on a server physically located
outside India.

i) The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered
or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey).

^A There is no significant change (i.e. change of not more than 25% as compared to the immediately previous financial year)
in the key financial ratios.

* There is an increase in net capital tunover ratio by about 47% in the current year as compared to previous year due to the
factors below :

1. Increase in total revenue from operations by 3.72% in the current year as compared to previous year is attributable to
increased demand in sales and new customers.

2. There is reduction in cash and cash equivalent due to payment of interim dividend and purchase of capital goods, which
leads to decreased in working capital.

for and on behalf of the board of directors of
Morganite Crucible (India) Limited

CIN: L26920MH1986PLC038607

Jonathan Percival Poonam Bopshetti

Director Manager & Director

DIN : 09701284 DIN : 11109675

Place : Chhatrapati Sambhajinagar Place : Chhatrapati Sambhajinagar

Date : 22 May 2025 Date : 22 May 2025

Hanumant Mandale pooja Jindal

Chief Financial Officer Company Secretary

Place : Pune Place : Chhatrapati Sambhajinagar

Date : 22 May 2025 Date : 22 May 2025

The average credit period on sales of goods is 45 - 60 days. Interest is charged below 30 days @12% and above 30 days @15% on overdue receivables from dealer, however no interest is charged on outstanding trade receivables (Other than dealer).

The Company always measures the loss allowance for trade receivables at an amount equal to lifetime expected credit loss. The expected credit losses on trade receivables are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor''s current financial position, adjusted for factors that are specific to the debtors, general economic conditions of the industry in which the debtors operate, and an assessment of both the current as well as the forecast direction of conditions at the reporting date. Outstanding customer receivables are reviewed periodically. Provision is made based on expected credit loss method or specific identification method.

The Company writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation or has entered into bankruptcy proceedings, or when the trade receivables are over 180 days past due, whichever occurs earlier. None of the trade receivables are subject to enforcement activities.

(a) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having a par value of '' 5 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

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.

The Company manages its capital to ensure that it will be able to continue as a going concern while maximizing the return to stakeholders through the optimization of the equity balance. The Company is not subject to any externally imposed capital requirements.

The amount that can be distributed as dividend by the company to its equity shareholders is determined based on the separate financial statements of the company and considering the requirements of the Companies Act, 2013. Thus, the amounts reported above are not distributable in entirety.

On 1 September 2023, the final dividend paid for FY 2023-24 was '' 11/- per share (total dividend '' 616 lakhs). On 9 November 2023, an interim dividend for FY 2023-24 of '' 28/- per share (total dividend '' 1568 lakhs) was paid to holders of fully paid equity shares.

In respect of the current year, the directors proposed that a dividend of Rs. 12 per share be paid on equity shares. The equity dividend is subject to approval by shareholders at the annual general meeting and has not been included as a liability in these financial statements. The total estimated equity dividend to be paid is Rs. 672 Lakhs.

Nature of Reserves -

a) General reserve : The General reserve comprises of transfer of profits from retained earnings for appropriation purposes. The reserve can be distributed/utilized by the Company in accordance with the Companies Act, 2013.

The general reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. There is no policy of regular transfer. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to profit or loss.

b) Securities premium : The Securities premium is created on issue of shares at a premium.

c) Capital reserve : Capital reserve comprises of receipt of Central Government investment subsidy under ''1993 package scheme of incentives'', State government investment subsidy under ''1983 package scheme of incentives and capital reserve arising on amalgamation of Diamond Crucible Company Limited.

d) Capital profit on forfeited shares - The capital profit on forfeited shares comprises of profit on re-issue of forfeited shares.

e) statutory Reserve : The statutory reserves comprises of the Investment allowance reserve created under the Income tax Act, 1961.

Trade payables principally comprise amounts outstanding for trade purchases. The average credit period taken for trade purchases is 30-45 days. For most suppliers, no interest is charged on the trade payables for the outstanding balances. The Company has financial risk management policies in place to ensure that all payables are paid within the pre-agreed credit terms.

The Company derives its revenue from contracts with customers for the transfer of goods and services at a point in time. The disclosure of revenue by product line is consistent with the revenue information that is disclosed for each reportable segment under Ind AS 108 (refer note 34).

ii) CORPORATE SOCIAL RESPONSIBILITY (CSR) :

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects. A CSR committee has been formed by the company as per the Act. The funds were primarily allocated to a corpus and utilized through the year on these activities which are specified in Schedule VII of the Companies Act, 2013:

Notes:

(i) The Company is subject to legal proceedings and claims, which have arisen in the ordinary course of business. The Company''s management does not reasonably expect that these legal actions, when ultimately concluded and determined, will have a material and adverse effect on the Company''s results of operations or financial condition.

(ii) The Company has filed an application for renewal of the Advanced Pricing Agreement (APA) for five years (FY 2021-22 to 2025-26) on 26 March 2021. The current tax working for period ended 31 March 2024 is calculated based on the APA signed on 18th August 2021 for 5 years ended 31 March 2021.

The information has been given in respect of such vendors to the extent they could be identified as micro and small enterprises as per the MSMED Act on the basis of information available with the Company.

34 SEGMENT REPORTING

a) Business Segments:

The Company recognizes its sale of crucibles activity as its only primary business segment since its operations predominantly consist of manufacture and sale of crucibles to its customers. The ''Chief Operating Decision Maker'' monitors the operating results of the Company''s business as single segment. Accordingly in context of Ind AS "Operating Segments" the principle business of the Company constitute a single reportable segment. Accordingly, income from sale of crucibles comprises the primary basis of segmental information set out in these financial statements.

b) Geographical segments:

The geographical information analyses the Company''s revenues and assets by the Company''s country of domicile (i.e. India) and outside India presenting geographical information, segment revenue has been on the geographic location of customers and segment assets which have been based on the geographical location of the assets.

B. Measurement of fair values

(i) Valuation techniques and significant unobservable inputs.

Level 1: Fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities

level 2: Fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)

level 3: Fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data

(ii) valuation techniques used to determine fair value "

Specific valuation techniques used to value the financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments

- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.

(iii) valuation processes

The finance team performs the valuation of financial assets and liabilities required for financial reporting purposes.

C. Risk Management Framework

The Company''s board of directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors has established the risk management committee, which is responsible for developing and monitoring the Company''s risk management policies. The committee reports regularly to the board of directors on its activities. The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate limits and controls and to monitor risks and adherence to limits. The Company, through its training and established procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

The nature of the Company''s business exposes it to a range of financial risks. These risks include:

(i) credit risk;

(ii) liquidity risk; and

(iii) market risk.

(i) Credit risk:

Credit risk refers to the risk that a counterpart will default on its contractual obligations resulting in financial loss to the Company. As at March 31, 2024, the company''s maximum exposure to credit risk without taking into account any collateral held or other credit enhancements which will cause a financial loss to the group due to failure to discharge an obligation by the counterparties and financial guarantees provided by the company arises from the carrying amount of the respective recognized financial assets as stated in the balance sheet.

a. Cash and bank balance

Credit risk from balances/ fixed deposits banks is managed in accordance with the Company''s risk management policy. Investments of surplus funds are made only with approved counterparties and within limits assigned to each counterparty. The limits are assigned based on corpus of investable surplus and corpus of the investment avenue. The limits are set to minimize 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 on account of deposits with banks is as mentioned below -

(ii) Liquidity risk:

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for management of the company''s short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The Company''s principal sources of liquidity are cash and cash equivalents and cash flow that is generated from operations. The Company has no outstanding bank borrowings. The Company believes that the current working capital is sufficient to meet its current obligatory requirements. Accordingly, no liquidity risk is perceived.

As on 31 March 2024, the Company had a working capital of '' 5,735.06 lakhs (as on 31 March 2023''6,619.17 lakhs) including cash and cash equivalents and other bank balance of '' 5,000.18 lakhs (as on 31 March 2023''4,567.11 lakhs). The working capital of the Company for this purpose has been derived as follows:

(iii) 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- such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

Market risk comprises of:

a. Interest rate risk

b. Foreign currency risk

Financial instruments affected by market risk include other financial assets, trade receivables and trade payables.

a. 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. Since the Company does not have any financial instrument with variable interest rates, it is not exposed to interest rate risk.

b. Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure 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 a foreign currency). The foreign currency to which the Company is majorly exposed to are US Dollars, EURO and GBP.

The following tables demonstrate the sensitivity to a reasonably possible change in USD, EURO and GBP exchange rates, with all other variables held constant -

Sensitivity Analysis

A reasonable possible strengthening / (weakening) of the major currencies US Dollar, EURO or GBP against all other currencies as at 31 March 2023 would have affected the measurement of financial instruments (including derivatives) denominated in a foreign currency and affected equity and profit by the amounts shown below. This analysis assumed that all other variables, in particular interest rates, remain constant and ignores any impact of the forecast sales and purchases.

Note 1

Financial assets carried at fair value as at 31 March 2024 is '' Nil and financial assets carried at amortized cost as at 31 March 2024 is '' 7753.82 lakhs. The Company has assessed the counterparty credit risk in connection with Cash and cash equivalents, bank deposits and earmarked balances with banks amount to '' 4,936.62 lakhs as at 31 March 2024 where the Company has assessed the counterparty credit risk.

Trade receivables amounting to '' 2,671.36 lakhs as at 31 March 2024 is valued at considering provision for allowance under the expected credit loss method. This assessment is based on the likelihood of the recoveries from the customers in the present situation. The Company closely monitors its customers who are going through financial stress and assesses actions such as change in payment terms, recognition of revenue on collection basis etc., depending on severity of each case.

Basis this assessment, the allowance for doubtful trade receivables is considered adequate.

37 EMPLOYEE BENEFITS

Defined contributions plans

The Company makes contributions, determined as a specified percentage of employee salaries, in respect of qualifying employees towards Provident Fund, Labour Welfare Fund and Superannuation Scheme, which are the defined contribution plans. The Company has no obligations other than to make the specified contributions. The contributions are charged to the Statement of Profit and Loss as they accrue. The amount recognized as an expense towards defined contribution plans for the year for provident fund and superannuation scheme aggregated to '' 93.63 Lakhs (31 March 2023: '' 79.35 Lakhs).

defined benefit plans Gratuity

The company sponsors defined benefit plans for qualifying employees. The defined benefit plans are administered by a separate fund that is legally separated from the entity. The trustees of the pension fund are required by law to act in the interest of the fund and of all relevant stakeholders in the plan. The trustees of the pension fund are responsible for the investment policy with regard to the assets of the fund. Under the plans, the employees are entitled to post-retirement yearly instalments amounting to 15 days salary for each year of completed service at the time of retirement / exit. The scheme is funded by plan assets.

The most recent actuarial valuations of the planned assets and the present value of the defined benefit liability were carried out at March 31, 2024 by appointed actuaries. The present value of the defined benefit liability, and the related current service cost and past service cost, were measured using the projected unit credit method.

The following table summarizes the position of assets and obligations relating to the plan.

a) Gratuity is payable to all eligible employees of the Company on superannuation, death, and permanent disablement, in terms of the provisions of the Payment of Gratuity Act, 1972.

b) The discount rate is based on the prevailing market yields Indian Government securities as at the Balance Sheet date for the estimated term of the obligations.

c) The Company''s gratuity fund is managed by Life Insurance Corporation of India, details of those funds invested by LIC are not readily available with the Company.

Performance obligations

The Company satisfies its performance obligations pertaining to the sale of crucibles at point in time when the control of goods is actually transferred to the customers. No significant judgment is involved in evaluating when a customer obtains control of promised goods. The payment is generally due within 45-60 days.

The Company is obliged for refunds due to shortages during the mode of transportation. There are no other significant obligations attached in the contract with customer.

Transaction price

There is no remaining performance obligation for any contract for which revenue has been recognized till period end. Further, the Company has not applied the practical expedient as specified in para 121 of Ind AS 115 as the Company do not have any performance obligations that has an original expected duration of one year or less or any revenue stream in which consideration from a customer corresponds directly with the value to the customer of the entity''s performance completed to date.

Determining the timing of satisfaction of performance obligations

There is no significant judgements involved in ascertaining the timing of satisfaction of performance obligations, in evaluating when a customer obtains control of promised goods, transaction price and allocation of it to the performance obligations.

Determining the transaction price and the amounts allocated to performance obligations

The transaction price ascertained for the only performance obligation of the Company (i.e. Sale of goods) is agreed in the contract with the customer. There is no variable consideration involved in the transaction price except for refund due to shortages which is adjusted with revenue.

39 VOLUNTARY RETIREMENT SCHEME

During the year ended March 31, 2024, the Company had initiated the discussions with the workers for the Voluntary Retirement Scheme (VRS). The Board of Directors in their meeting held on February 13, 2024 have approved the Voluntary Retirement Scheme 2023-24 ("Scheme"). The Company has considered a provision of '' 321.08 lakhs and reported the same as exceptional item in the Financial statements.

40 Goodwill

Following is the summary of changes in carrying amount of goodwill:

The Company tests goodwill for impairment at least annually, or more frequently if events or changes in circumstances indicate that it might be impaired. The Company has identified a single cash generating unit ("CGU") based on the business. The recoverable amount of CGU is determined based on higher of value-in-use and fair value less cost to sell. The recoverable value was determined by value in use in cases where there is no basis for making a reliable estimate of the price at which an orderly transaction to sell the asset would take place between market participants at the measurement date under current market conditions. In determining the value in use, cash flow projections from financial budgets approved by senior management have been considered.

Market related information and estimates are used to determine the recoverable amount. Key assumptions on which management has based its determination of recoverable amount include estimated long-term growth rates, weighted average cost of capital and estimated operating margins. Cash flow projections are considered for next 5 years and consider past experience and represent management''s best estimate about future developments. Cash flows beyond the five-year period are extrapolated using a 2% growth rate. The pre-tax discount rate applied to cash flow projections for impairment testing during the current year is 12%. An analysis of the sensitivity of the computation of recoverable amount to a change in key parameters, based on reasonable assumptions, did not identify any probable scenario in which the recoverable amount of the CGU would decrease below its carrying amount other than the amount.

41 transfer pricing

The Company has developed a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The management is of the opinion that its international transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

During the earlier years the Company has applied for Advance Pricing Agreement (APA) before the Central Board of Direct Tax (CBDT) and Government of India for International Inter-company related party transactions with Associated Enterprises (AE). The Company has entered into in APA agreement with CBDT dated 18 August 2021 for 5 years ended 31 March 2021.

The Company has also filed application for renewal of APA agreement for five years (FY 2021-22 to 2025-26) on 26 March 2021 and current tax working for FY 2023-24 is calculated based on the APA agreement signed on 18th August 2021 for 5 years ended 31 March 2021.

The Domestic Transfer Pricing Regulations as prescribed under section 92BA of the Income Tax Act, 1961 was introduced from April 1, 2012. The Company has been consistently transacting with related parties on an Arm''s Length basis in accordance

with the Group Transfer Pricing Policy. The Company is of the opinion that there will be no significant changes to Arm''s length price under determination in order to comply with the requirement of section 92BA of Income Tax Act. Hence, there will be no material impact on the financial statements.

42 The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified and the rules are yet to be framed. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective and the related rules are published.

43 OTHER INFORMATION

a) The Company did not have any transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of Companies Act, 1956 during the financial year except as mentioned in Note 12.

b) The Company does not have any Benami property, where any proceedings have been initiated or are pending against the Company for holding any Benami property.

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

d) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.

e) The Company have not advanced or loaned or invested funds (either from borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

f) The Company have 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:

(i) 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

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,

g) The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey).

^A There is no significant change (i.e. change of more than 25% as compared to the immediately previous financial year) in the key financial ratios.

* There is an increase in profits by about 45% in the current year as compared to previous year due to the factors below :

1. I ncrease in total revenue from operations by 8.63% in the current year as compared to previous year is attributable to increased demand in sales and new customers.

2. There is reduction in cost of goods sold due to cost optimization programmes.

The average credit period on sales of goods is 45 - 60 days. Interest is charged below 30 days @12% and above 30 days @15% on overdue receivables from dealer, however no interest is charged on outstanding trade receivables (Other than dealer).

The Company always measures the loss allowance for trade receivables at an amount equal to lifetime expected credit loss. The expected credit losses on trade receivables are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor''s current financial position, adjusted for factors that are specific to the debtors, general economic conditions of the industry in which the debtors operate, and an assessment of both the current as well as the forecast direction of conditions at the reporting date. Outstanding customer receivables are reviewed periodically. Provision is made based on expected credit loss method or specific identification method.

(a) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having a par value of '' 5 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

The board of director at the board meeting held on 10th November 2022 approved dividend of '' 9 per equity share for interim period ended 30 September 2022 which was subsequently paid during the quarter ended 31 December 2022. The amount was recognized as distributions to equity shareholders during the year ended 31 March 2023 and the total appropriation was '' 504 lakhs.

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.

The Company manages its capital to ensure that it will be able to continue as a going concern while maximizing the return to stakeholders through the optimization of the equity balance. The Company is not subject to any externally imposed capital requirements.

Nature of Reserves -

a) General reserve : The General reserve comprises of transfer of profits from retained earnings for appropriation purposes. The reserve can be distributed/utilized by the Company in accordance with the Companies Act, 2013.

The general reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. There is no policy of regular transfer. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to profit or loss.

b) Securities premium : The Securities premium is created on issue of shares at a premium.

c) Capital reserve: Capital reserve comprises of receipt of Central Government investment subsidy under ''1993 package scheme of incentives'', State government investment subsidy under ''1983 package scheme of incentives and capital reserve arising on amalgamation of Diamond Crucible Company Limited.

d) Capital profit on forfeited shares - The capital profit on forfeited shares comprises of profit on re-issue of forfeited shares.

e) statutory Reserve : The statutory reserves comprises of the Investment allowance reserve created under the Income tax Act, 1961.

Trade payables principally comprise amounts outstanding for trade purchases. The average credit period taken for trade purchases is 30-45 days. For most suppliers, no interest is charged on the trade payables for the outstanding balances. The Company has financial risk management policies in place to ensure that all payables are paid within the pre-agreed credit terms.

The Company derives its revenue from contracts with customers for the transfer of goods and services at a point in time. The disclosure of revenue by product line is consistent with the revenue information that is disclosed for each reportable segment under Ind AS 108 (refer note 34).

ii) CORPORATE SOCIAL RESPONSIBILITY (CSR) :

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects. A CSR committee has been formed by the company as per the Act. The funds were primarily allocated to a corpus and utilized through the year on these activities which are specified in Schedule VII of the Companies Act, 2013:

Note 1 - The Company is subject to legal proceedings and claims, which have arisen in the ordinary course of business. The Company''s management does not reasonably expect that these legal actions, when ultimately concluded and determined, will have a material and adverse effect on the Company''s results of operations or financial condition.

(ii) The Company has filed an application for renewal of the Advanced Pricing Agreement (APA) for five years (FY 2021-22 to 2025-26) on 26 March 2021. The current tax working for period ended 31 March 2023 is calculated based on the APA signed on 18th August 2021 for 5 years ended 31 March 2021.

The information has been given in respect of such vendors to the extent they could be identified as micro and small enterprises as per the MSMED Act on the basis of information available with the Company.

34 SEGMENT REPORTINGa) Business Segments:

The Company recognizes its sale of crucibles activity as its only primary business segment since its operations predominantly consist of manufacture and sale of crucibles to its customers. The ''Chief Operating Decision Maker'' monitors the operating results of the Company''s business as single segment. Accordingly in context of Ind AS "Operating Segments" the principle business of the Company constitute a single reportable segment. Accordingly, income from sale of crucibles comprises the primary basis of segmental information set out in these financial statements.

b) Geographical segments:

The geographical information analyses the Company''s revenues and assets by the Company''s country of domicile (i.e. India) and outside India presenting geographical information, segment revenue has been on the geographic location of customers and segment assets which have been based on the geographical location of the assets.

B. Measurement of fair values

(i) Valuation techniques and significant unobservable inputs.

Level 1: Fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities

Level 2: Fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)

Level 3: Fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

(ii) Valuation techniques used to determine fair value

Specific valuation techniques used to value the financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments

- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.

(iii) Valuation processes

The finance team performs the valuation of financial assets and liabilities required for financial reporting purposes.

C. Risk Management Framework

The Company''s board of directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors has established the risk management committee, which is responsible for developing and monitoring the Company''s risk management policies. The committee reports regularly to the board of directors on its activities. The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate limits and controls and to monitor risks and adherence to limits. The Company, through its training and established procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

The nature of the Company''s business exposes it to a range of financial risks. These risks include:

(i) credit risk;

(ii) liquidity risk; and

(iii) market risk.

(i) Credit risk:

Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. a. Cash and bank balance

Credit risk from balances/ fixed deposits banks is managed in accordance with the Company''s risk management policy. Investments of surplus funds are made only with approved counterparties and within limits assigned to each counterparty. The limits are assigned based on corpus of investable surplus and corpus of the investment avenue. The limits are set to minimize 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 on account of deposits with banks is as mentioned below -

(ii) Liquidity risk:

The Company''s principal sources of liquidity are cash and cash equivalents and cash flow that is generated from operations. The Company has no outstanding bank borrowings. The Company believes that the current working capital is sufficient to meet its current obligatory requirements. Accordingly, no liquidity risk is perceived.

As on 31 March 2023, the Company had a working capital of '' 6,619.17 lakhs (as on 31 March 2022''6570.09 lakhs) including cash and cash equivalents and other bank balance of '' 4,567.11 lakhs (as on 31 March 2022''3624.38 lakhs). The working capital of the Company for this purpose has been derived as follows:

(iii) 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- such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

Market risk comprises of:

a. Interest rate risk

b. Foreign currency risk

Financial instruments affected by market risk include other financial assets, trade receivables and trade payables.

a. 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. Since the Company does not have any financial instrument with variable interest rates, it is not exposed to interest rate risk.

b. Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure 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 a foreign currency). The foreign currency to which the Company is majorly exposed to are US Dollars, EURO and GBP.

The following tables demonstrate the sensitivity to a reasonably possible change in USD, EURO and GBP exchange rates, with all other variables held constant -

Sensitivity Analysis

A reasonable possible strengthening / (weakening) of the major currencies US Dollar, EURO or GBP against all other currencies as at 31 March 2023 would have affected the measurement of financial instruments (including derivatives) denominated in a foreign currency and affected equity and profit by the amounts shown below. This analysis assumed that all other variables, in particular interest rates, remain constant and ignores any impact of the forecast sales and purchases.

Note 1

Financial assets carried at fair value as at 31 March 2023 is '' Nil and financial assets carried at amortized cost as at 31 March 2023 is '' 7339.27 lakhs. The Company has assessed the counterparty credit risk in connection with Cash and cash equivalents, bank deposits and earmarked balances with banks amount to '' 4515.04 lakhs as at 31 March 2023 where the Company has assessed the counterparty credit risk.

Trade receivables amounting to '' 2706.06 lakhs as at 31 March 2023 is valued at considering provision for allowance under the expected credit loss method. This assessment is based on the likelihood of the recoveries from the customers in the present situation. The Company closely monitors its customers who are going through financial stress and assesses actions such as change in payment terms, recognition of revenue on collection basis etc., depending on severity of each case.

Basis this assessment, the allowance for doubtful trade receivables is considered adequate.

37 EMPLOYEE BENEFITSDefined contributions plans

The Company makes contributions, determined as a specified percentage of employee salaries, in respect of qualifying employees towards Provident Fund, Labour Welfare Fund and Superannuation Scheme, which are the defined contribution plans. The Company has no obligations other than to make the specified contributions. The contributions are charged to the Statement of Profit and Loss as they accrue. The amount recognized as an expense towards defined contribution plans for the year for provident fund and superannuation scheme aggregated to '' 53.28 Lakhs (31 March 2022: '' 80.89 Lakhs).

defined benefit plans

Gratuity

The Company operates post employment defined benefit plans that provide gratuity benefit. The gratuity plan entitles an employee, who has rendered at least five years of continuous service, to receive 15 days salary for each year of completed service at the time of retirement / exit. The scheme is funded by plan assets.

The following table summarizes the position of assets and obligations relating to the plan.

a) Gratuity is payable to all eligible employees of the Company on superannuation, death, and permanent disablement, in terms of the provisions of the Payment of Gratuity Act, 1972.

b) The discount rate is based on the prevailing market yields Indian Government securities as at the Balance Sheet date for the estimated term of the obligations.

c) The Company''s gratuity fund is managed by Life Insurance Corporation of India, details of those funds invested by LIC are not available with the Company.

Performance obligations

The Company satisfies its performance obligations pertaining to the sale of crucibles at point in time when the control of goods is actually transferred to the customers. No significant judgment is involved in evaluating when a customer obtains control of promised goods. The payment is generally due within 45-60 days.

The Company is obliged for refunds due to shortages during the mode of transportation. There are no other significant obligations attached in the contract with customer.

Transaction price

There is no remaining performance obligation for any contract for which revenue has been recognized till period end. Further, the Company has not applied the practical expedient as specified in para 121 of Ind AS 115 as the Company do not have any performance obligations that has an original expected duration of one year or less or any revenue stream in which consideration from a customer corresponds directly with the value to the customer of the entity''s performance completed to date.

Determining the timing of satisfaction of performance obligations

There is no significant judgements involved in ascertaining the timing of satisfaction of performance obligations, in evaluating when a customer obtains control of promised goods, transaction price and allocation of it to the performance obligations.

Determining the transaction price and the amounts allocated to performance obligations

The transaction price ascertained for the only performance obligation of the Company (i.e. Sale of goods) is agreed in the contract with the customer. There is no variable consideration involved in the transaction price except for refund due to shortages which is adjusted with revenue.

39. CLOSURE AND RELOCATION EXPENSES RELATING TO MEHSANA PLANT

During the previous year ended 31 March 2021, the management had identified the potential buyer for sale of Land and Building of Mehsana Plant. The management had entered into an "Memorandum of Understanding" (MOU) dated 12 February 2021 for sale of land and building.

With effect from May 21 production activities have been stopped at Mehsana plant, all assets has been transferred from Mehsana to Aurangabad plant. The Company has sold the land and building of Mehsana Plant on November 1 1, 2021 and subsequently submitted the application before GIDC for effecting the transfer of the property. The GIDC vide its Officer Order dated 04 December 2021 had approved the transfer of property in the name of Buyer and accordingly the possession of the property handed over to the Buyer effective from December 06, 2021. Basis the approval from GIDC, the Company executed sale deed for Rs. 900 lakhs for Mehsana Plant Land & building in November 2021 and transferred the land & Building to prospective buyer in the month of December 2021. The profit on sale of Land and Building to the extent of Rs. 738 Lakhs was recognized in Other Income in the year ended on 31 March 2022.

40. LEASES

The Ministry of Corporate Affairs has notified Indian Accounting Standard 116 (''Ind AS 116''), Leases, with effect from 1 April 2019. The Standard primarily requires the Company, as a lessee, to recognize, at the commencement of the lease a right-to-use asset and a lease liability (representing present value of unpaid lease payments). Such right-to-use assets are subsequently depreciated and the lease liability reduced when paid, with the interest on the lease liability being recognized as finance costs, subject to certain remeasurement adjustments.

The Company has adopted the modified prospective transition method recognizing the lease liability at the present value of the remaining lease payments, discounted using the lessee''s incremental borrowing rate at the date of initial application and recognized the Right of Use Asset (ROU) an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments relating to that lease recognized in the balance sheet immediately before the date of initial application.

The total cash outflow for leases is '' Nil ( 2022 : '' 6.29 lakhs), including cash outflow for short term and low value leases.

41. TRANSFER PRICING

The Company has developed a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The management is of the opinion that its international transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

During the earlier years the Company has applied for Advance Pricing Agreement (APA) before the Central Board of Direct Tax (CBDT) and Government of India for International Inter-company related party transactions with Associated Enterprises (AE). The Company has entered into in APA agreement with CBDT dated 18 August 2021 for 5 years ended 31 March 2021.

The Company has also filled application for renewal of APA agreement for five years (FY 2021-22 to 2025-26) on 26 March 2021 and current tax working for FY 2022-23 is calculated based on the APA agreement signed on 18th August 2021 for 5 years ended 31 March 2021.

The Domestic Transfer Pricing Regulations as prescribed under section 92BA of the Income Tax Act, 1961 was introduced from April 1, 2012. The Company has been consistently transacting with related parties on an Arm''s Length basis in accordance with the Group Transfer Pricing Policy. The Company is of the opinion that there will be no significant changes to Arm''s length price under determination in order to comply with the requirement of section 92BA of Income Tax Act. Hence, there will no material impact on the financial statements.

The Company tests goodwill for impairment at least annually, or more frequently if events or changes in circumstances indicate that it might be impaired. The Company has identified a single cash generating unit ("CGU") based on the business. The recoverable amount of CGU is determined based on higher of value-in-use and fair value less cost to sell. The recoverable value was determined by value in use in cases where there is no basis for making a reliable estimate of the price at which an orderly transaction to sell the asset would take place between market participants at the measurement date under current market conditions. In determining the value in use, cash flow projections from financial budgets approved by senior management have been considered.

Market related information and estimates are used to determine the recoverable amount. Key assumptions on which management has based its determination of recoverable amount include estimated long-term growth rates, weighted average cost of capital and estimated operating margins. Cash flow projections are considered for next 5 years and consider past experience and represent management''s best estimate about future developments. Cash flows beyond the five-year period are extrapolated using a 2% growth rate. The pre-tax discount rate applied to cash flow projections for impairment testing during the current year is 12%. An analysis of the sensitivity of the computation of recoverable amount to a change in key parameters, based on reasonable assumptions, did not identify any probable scenario in which the recoverable amount of the CGU would decrease below its carrying amount other than the amount.

43. ''During the month of January 2023, the Company was informed by the ultimate holding entity viz. Morgan Advanced Materials Plc, that the ultimate holding entity had encountered a cyber incident on their IT systems. Although, the Company has separate IT systems and infrastructure in India, as an immediate precautionary measure, basis advice from ultimate holding entity, the Company had temporarily shut down access to IT systems for security reasons which led to temporary disruption in some of the Company''s business activities. The Company had put in place alternative control mechanism in the absence of the access to the said systems. Based on the investigation carried out by the ultimate holding company at group level, the said systems were restored in a phased manner after taking all the possible necessary measures and it was informed that there was no impact on the Company''s IT systems and infrastructure. As per the Company''s assessment there was no impact on the financial statement and results of the Company for the year ended 31 March 2023 due to cyber incident at the ultimate holding entity level.

44. The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified and the rules are yet to be framed. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective and the related rules are published.

45. OTHER INFORMATION

a) The Company did not have any transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of Companies Act, 1956 during the financial year except as mentioned in Note 12.

b) The Company does not have any Benami property, where any proceedings have been initiated or are pending against the Company for holding any Benami property.

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

d) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.

e) The Company have not advanced or loaned or invested funds (either from borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

f) The Company have 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:

(i) 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

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,

g) The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered

or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey).

^A There is no significant change (i.e. change of more than 25% as compared to the immediately previous financial year) in the key financial ratios.

* Higher amount of Other income was earned in PY due to Non-operating income earned from holding company and Sale of Mehsana Plant, which is Nil in CY

Hence major reduction is seen in profit as compared to PY resulting in decrease in the ratio.

@ Increase in COGS is seen due to major increase in RM costs for Graphite and silicon in the CY as compared to the PY, due to which increase is seen in ratio.

1. RECENT ACCOUNTING PRONOUNCEMENTS

Standards issued but not yet effective

4.1 New Accounting Standards yet to be adopted

Ministry of Corporate Affairs ("MCA") through Companies (Indian Accounting Standards) Amendment Rules, 2018 has notified the following new Accounting Standards (''Ind AS'') and amendments to Ind ASs which the Company has not applied as they are effective for annual periods beginning on or after April 1, 2018:

Ind AS 115 - Revenue from Contracts with Customers

Ind AS 115 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. Ind AS 115 will supersede the current revenue recognition standard Ind AS 18 Revenue, Ind AS 11 Construction Contracts when it becomes effective.

The core principle of Ind AS 115 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Specifically, the standard introduces a 5-step approach to revenue recognition:

- Step 1: Identify the contract(s) with a customer

- Step 2: Identify the performance obligation in contract

- Step 3: Determine the transaction price

- Step 4: Allocate the transaction price to the performance obligations in the contract

- Step 5: Recognise revenue when (or as) the entity satisfies a performance obligation

Under Ind AS 115, an entity recognizes revenue when (or as) a performance obligation is satisfied, i.e. when ''control'' of the goods or services underlying the particular performance obligation is transferred to the customer

The Company has completed an initial assessment of the potential impact of the adoption of Ind AS 115 on accounting policies followed in its financial statements. The quantitative impact of adoption of Ind AS 115 on the financial statements in the period

of initial application is not reasonably estimable as at present. However as per the management assessment the impact is not expected to be significant.

Transition

The Company plans to apply Ind AS 115 using the cumulative effect method , with the effect of initially applying this standard recognized at the date of initial application (i.e. 1 April 2018) in retained earnings. As a result, the Company will not present relevant individual line items appearing under comparative period presentation.

Ind AS 21 - The effect of changes in Foreign Exchanges rates

The amendment has been incorporated in Ind AS 21 as Appendix B which clarifies on the accounting of transactions that include the receipt or payment of advance consideration in a foreign currency. The appendix is applicable for accounting periods beginning on or after 1 April 2018. The appendix explains that the date of the transaction, for the purpose of determining the exchange rate, is the date of initial recognition of the non-monetary prepayment asset or deferred income liability. If there are multiple payments or receipts in advance, a date of transaction is established for each payment or receipt. The Company is evaluating the impact of this amendment on its financial statements.

(a) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having a par value of '' 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 dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

The shareholders at the Annual General Meeting held on 09 August 2017 approved dividend of Rs, 8 per equity share for year ended 31 March 2017 which was subsequently paid during the quarter ended 30 September 2017. The amount was recognized as distributions to equity shareholders during the nine month period ended 31 December 2017 and the total appropriation was Rs, 269.60 lakhs including corporate dividend tax of Rs, 45.60 lakhs.

On 24 May 2018, the Board of Directors have proposed a final dividend of Rs, 16 per equity share for the financial year ended 31 March 2018. The proposal is subject to the approval of shareholders at the Annual General Meeting. If approved, the dividend would result in a cash outflow of Rs, 540.10 lakhs inclusive of dividend distribution tax of Rs, 92.10 lakhs.

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.

The information has been given in respect of such vendors to the extent they could be identified as micro and small enterprises as per the MSMED Act on the basis of information available with the Company

2. Segment reporting

a) Business Segments:

The Company recognizes its sale of crucibles activity as its only primary business segment since its operations predominantly consist of manufacture and sale of crucibles to its customers. The ''Chief Operating Decision Maker'' monitors the operating results of the Company''s business as single segment. Accordingly in context of Ind AS "Operating Segments" the principle business of the Company constitute a single reportable segment. Accordingly, income from sale of crucibles comprises the primary basis of segmental information set out in these financial statements.

b) Geographical segments:

The geographical information analyses the Company''s revenues and assets by the Company''s country of domicile (i.e. India) and outside India presenting geographical information, segment revenue has been on the geographic location of customers and segment assets which have been based on the geographical location of the assets.

* The non-current assets in the above table excludes financial assets, deferred tax assets and post-employment benefits assets.

3. RELATED PARTY DISCLOSURES A. Names of related parties

a. Parties (where controls exists)

Morgan Advanced Materials Plc - Ultimate Holding Company

b. Investing Associates

Morganite Crucible Limited (holds 38.50% of issues, subscribed and paid up capital)

Morgan Terreassen BV (holds 36.50% of issues, subscribed and paid up capital)

c. Other related parties with whom transactions have taken place during the year

i Fellow subsidiary companies Morganite Crucible Inc.

Mkgs. Morgan Karbon Grafit

Morgan Molten Metal System (Suzhou) Company Limited

Morgan Molten Metal System GMBH Morganite Brasil Ltda.

Grupo Industrial Morgan, S.A. De C.

Morganite Carbon Kabushiki Kaisha Dalian Morgan Refractories Ltd Morgan Am&T Hong Kong Co., Ltd.

Morgan Advanced Materials Furnace Indust Morgan Advanced Materials (Taiwan) Co.

Murgappa Morgan Thermal Ceramics Limited, Chennai Thermal Ceramics Limited, Uk Molten Ceramics Asia Pte. Ltd.

Morgan Ceramics Middle East FZE Furnace Industries

Morgan Advanced Materials India Private Limited

ii Key Management Personnel Mr. Aniruddha Karve - Managing Director (upto 31 March 2018)

Late Mr. Hitesh Saiwal - Managing Director (upto 30 April 2015)

Mr. Atithi Majumdar - Chief Financial Officer

Mr. Rupesh Khokle - Company Secretary

Mr. Mukund Bhogale -Non-Executive Independent Director **

Mr. Subhash Kolakpar -Non-Executive Independent Director** Ms. Maithilee Tambolkar -Non-Executive Independent Director**

C. Risk Management Framework

The Company''s board of directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors has established the risk management committee, which is responsible for developing and monitoring the Company''s risk management policies. The committee reports regularly to the board of directors on its activities. The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate limits and controls and to monitor risks and adherence to limits. The Company, through its training and established procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

The nature of the Company''s business exposes it to a range of financial risks. These risks include:

(i) credit risk;

(ii) liquidity risk; and

(iii) market risk.

(i) Credit risk:

Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to '' 1,696.51 lakhs and '' 1,841.52 lakhs as of 31 March 2018 and 31 March 2017, respectively. Trade receivables are typically unsecured and are derived from revenue earned from customers located in India and outside India. The management has established accounts receivable policy under which customer accounts are regularly monitored. The Company has a dedicated sales team which is responsible for collecting dues from the customer within stipulated period. The management reviews status of critical accounts on a regular basis.

On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss of trade receivables.

a) Expected credit loss assessment for trade receivables as at 31 March 2018, 31 March 2017 and 1 April 2016 :

The Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. Expected loss rates are based on average computed default rate based on historical analysis of trade receivables.

The following table provides information about the exposure to credit risk and expected credit loss for trade receivables -

(ii) Liquidity risk:

The Company''s principal sources of liquidity are cash and cash equivalents and cash flow that is generated from operations. The Company has no outstanding bank borrowings. The Company believes that the current working capital is sufficient to meet its current obligatory requirements. Accordingly, no liquidity risk is perceived.

As on 31 March 2018, the Company had a working capital of Rs, 5,838.33 lakhs (as on 31 March 2017 Rs, 4731.79 lakhs, as on 1 April 2016 Rs, 3,359.60 lakhs) including cash and cash equivalents and other bank balance of Rs, 4,038.39 lakhs (as on 31 March 2017 Rs, 4,586.21 lakhs; as on 1 April 2016 Rs, 2,859.95 lakhs). The working capital of the Company for this

(iii) 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- such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

Market risk comprises of:

a. Interest rate risk

b. Foreign currency risk

Financial instruments affected by market risk include other financial assets, trade receivables and trade payables.

a. 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. Since the Company does not have any financial instrument with variable interest rates, it is not exposed to interest rate risk.

b. Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure 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 a foreign currency). The foreign currency to which the Company is majorly exposed to are US Dollars and GBP

The Company has entered into derivative contracts to hedge its risk associated with foreign currency fluctuations. However, none of these contracts can be co-related on one to one basis against the underlying exposure. The forward sell contracts which are outstanding as at end of the year is as follows:

4. Scheme of amalgamation with Diamond Crucible Company Limited -

As on 31 March 2017, the company held 51% equity shares of ''Diamond Crucible Company Limited'' (DCCL) and during the year on 30 June 17, the company acquired the balance stake (49%) in DCCL from Terrassen Holdings Limited for cash consideration amounting to Rs, 1,675 lakhs to make it a wholly owned subsidiary.

On 10 August 2017, the Board of Directors of the Company approved a scheme of amalgamation ("the Scheme") for amalgamation of ''Diamond Crucible Company Limited ''into the Company. The Scheme has been approved by the National Company Law Tribunal (NCLT), Mumbai Bench on 22 February 2018.

Appointed date for the scheme is 1 October 2017. Under the Scheme, the Company has accounted for the amalgamation of DCCL on the pooling of interest method as stated in Appendix C of Indian Accounting Standard (IND AS 103) Business Combination. Accordingly all the assets and liabilities of DCCL are acquired at book values and the identity of reserves of DCCL are preserved in the books of the Company post amalgamation.

As per the requirements of IND AS 103, being a common control business combination, financial information in the financial statements in respect of prior periods have been restated as if the business combination had occurred from the beginning of the preceding period in the financial statements i.e 1 April 2016.

(i) Summary of assets and liabilities acquired as a result of the scheme is as given below -

1 The value of the investments of Rs. 2,171.99 lakhs in the equity shares of DCCL held by the Company shall stand cancelled in the books of the Company, without further act or deed. Accordingly carrying value of investments cancelled is debited to opening retained earnings.

ii The Company undertakes to have all legal or other proceedings initiated by or against DCCL transferred in its name respectively and to have the same continued, prosecuted and enforced by or against it to the same extent as would or might have been continued and enforced by or against DCCL, to the exclusion of it.

iii As per Appendix C, Business Combinations of Entities under Common Control of Ind AS 103, Business Combinations, in case of common control business combinations, the assets and liabilities of the combining entities are reflected at their carrying amounts. As per the ITFG 9, carrying value of assets and liabilities of the transferor entity (''DCCL'') as considered in the consolidated financials of the Company prior to amalgamation is considered for accounting of common control business combination.

5. First time adoption of Ind AS

As stated in Note 2(a), Pursuant to the scheme of merger approved by NCLT by its Order dated 22 February 2018, Diamond Crucible Company Limited (100% subsidiary) was merged with the Company with effect from 1 October 2017. As per the requirements of Appendix C of Ind AS 103, being a common control business combination, financial information presented in the financial statements in respect of prior periods have been restated as if the business combination had occurred from the beginning of the preceding period in the financial statements i.e 1 April 2016.

These are the Company''s first financial statements prepared in accordance with Ind AS. For the year ended 31 March 2017, the Company had prepared its financial statements in accordance with Companies (Accounting Standards) Rules, 2006, notified under Section 133 of the Act and other relevant provisions of the Act (''Previous GAAP'').

The accounting policies set out in Note 3 have been applied in preparing these financial statements for the year ended 31 March

2018 including comparative information for the year ended 31 March 2017 and the opening Ind AS Balance Sheet on the date of transition i.e. 1 April 2016.

In preparing its Ind AS Balance Sheet as at 1 April 2016 and in presenting the comparative information for the year ended 31 March 2017, the Company has adjusted amounts reported previously in financial statements prepared in accordance with previous GAAP. This note explains the principal adjustments made by the Company in restating its financial statements prepared in accordance with previous GAAP, and how transition from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flows.

Optional exemptions availed and mandatory exceptions

In preparing these financial statements, the Company has applied the below mentioned optional exemptions and mandatory exceptions.

A Optional exemptions availed 1 Business Combinations:

As per Ind AS 101, at the date of transition, an entity may not elect to restate business combinations that occurred before the date of transition. If the entity restates any business combinations that occurred before the date of transition, then it restates all the later business combinations, and also applies Ind AS 110, Consolidated Financial Statements, from that same date.

The Company has opted not to restate business combinations that occurred before the date of transition.

6 Property, plant and equipment, Intangible assets and investment properties:

As per Ind AS 101, an entity may elect to:

(i) measure an item of property, plant and equipment at the date of transition at its fair value and may use that fair value as its deemed cost at that date

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

# Refer Note 37 for details of merger. Effect of merger also includes intercompany eliminations.

** Effect of Ind AS adjustments is after giving effect to the scheme of amalgamation as stated in Note 37.

c Explanatory notes to the Balance Sheet and Statement of Profit and Loss Reconciliation i Excise duty

Under previous GAAP, revenue from sale of goods was presented net of the excise duty on sales. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. Excise duty is presented in the Statement of Profit and Loss as an expense. This has resulted in an increase in the revenue from operations and expenses for the year ended 31 March 2017 by '' 571.51 lakhs. The total comprehensive income for the year ended and equity as on 31 March 2017 has remained unchanged.

ii Remeasurement of defined benefit plans

In the financial statements prepared under Previous GAAP, measurement of defined benefit plans (gratuity), arising primarily due to change in actuarial assumptions was recognized as employee benefits expense in the Statement of Profit and Loss. Under Ind AS, such remeasurement benefits relating to defined benefit plans is recognized in other comprehensive income (OCI) as per the requirements of Ind AS 19- Employee benefits. Consequently, the related tax effect of the same has also been recognized in OCI.

For the year ended 31 March, 2017, remeasurement of gratuity liability resulted in a net loss of '' 23.09 lakhs which has now been removed from employee benefits expense in the Statement of Profit and Loss and recognized separately in Other Comprehensive Income. This has resulted in decrease in Employee benefits expense by '' 23.09 lakhs and loss in Other Comprehensive income by '' 23.09 lakhs for the year ended 31 March, 2017. Consequently, tax effect of the same amounting to '' 7.99 lakhs is also recognized separately in Other Comprehensive Income.

iii Provisions

In accordance with Ind AS 10, Events after the Reporting Period, provision for proposed final dividend and tax on dividend has been derecognized by the Company, as dividend was declared by the company and approved by shareholders in the annual general meeting which was after the end of the reporting period. The impact arising from the change is summarized below:

7. Employee benefits

Defined contributions plans

The Company makes contributions, determined as a specified percentage of employee salaries, in respect of qualifying employees towards Provident Fund, Labour Welfare Fund and Superannuation Scheme , which are the defined contribution plans. The Company has no obligations other than to make the specified contributions. The contributions are charged to the Statement of Profit and Loss as they accrue. The amount recognized as an expense towards defined contribution plans for the year for provident fund and superannuation scheme aggregated to INR 85.87 Lakhs (31 March 2017: INR 76.95 Lakhs).

Defined benefit plans

Gratuity

The Company operates post-employment defined benefit plans that provide gratuity benefit. The gratuity plan entitles an employee, who has rendered at least five years of continuous service, to receive 15 days salary for each year of completed service at the time of retirement / exit. The scheme is funded by plan assets.

Although, the analysis does not take account of full distribution of cash flows expected under the plan, it does provide an approximation of the sensitivity of the assumptions shown.

8. Managerial Remuneration

During an earlier year, the Company had paid managerial remuneration to Late Hitesh Saiwal- Managing Director amounting to Rs, 102.07 lakhs which was in excess of the limits specified in section 197 read with Schedule V of the Act by Rs, 73.01 lakhs. The Company had made an application to the Central Government for waiver of such excess remuneration paid. During the year ended 31 March 2018, the Central Government has rejected the said application by its Order dated 11 August 2017. Further, based on the management''s evaluation of the response received from legal heirs of Late Hitesh Saiwal to the notice sent for recovery of such excess remuneration, the Company has filed the application with the Central Government to reconsider its aforesaid Order.

9. Transfer Pricing

The Company has developed a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The management is of the opinion that its international transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

During the previous year the Company has applied for Advance Pricing Agreement (APA) before the Central Board of Direct Tax (CBDT) and Government of India for International Inter-company related party transactions with associated Enterprises (AE). The APA is an arrangement between the taxpayer and the tax authority covering future transactions, with a view to avoid the potential transfer pricing disputes in a cooperative manner. Once APA agreement is completed, the Company will have certainty with respect to tax outcome of international transactions, by agreeing in advance the arm''s length pricing, or pricing methodology which is to be applied. Under APA specific rollback provisions enable to attain certainty in transfer prices of international transactions for up to 9 years (including 4 years rollback provisions) in total. The company has applied for Advanced Pricing Agreement (APA) in FY 2015-16, the period covered under rollback is from FY 2012-13 to FY 2015-16 and five year down the line i.e. from FY 2016-17 to 2020-21. Besides this the APA has a persuasive value on all open Transfer pricing litigations of past years. During the year, the Company received questionnaire from the CBDT and the Company has replied to the questionnaire.

The Domestic Transfer Pricing Regulations as prescribed under section 92BA of the Income Tax Act, 1961 was introduced from April 1, 2012. The Company has been consistently transacting with related parties on an Arm''s Length basis in accordance with Group Transfer Pricing Policy. The Company is of the opinion that there will be no significant changes to Arm''s length price under determination in order to comply with the requirement of section 92BA of Income Tax Act. Hence, there will no material impact on the financial statements.

10. The previous year''s figures were audited by a firm other than B S R & Associates LLP

11. Figures for the previous year have been regrouped / rearranged wherever necessary to confirm with the current year''s classification.

1. Managerial Remuneration

During the year Mr. Hitesh Saiwal resigned as Managing Director with effect from 30 April 2015. The Company has paid an additional remuneration of Rs. 7,214,160 to him, which has been approved by a special resolution in the General Meeting dated 22 September 2015. If the limits prescribed under section 197 read with Schedule V of the Act are pro-rated for one month, then the total remuneration paid to him of Rs. 10,207,067 (which includes superannuation fund, gratuity and leave encashment aggregating Rs. 2,206,504) is more than the prorated permissible limit by Rs. 7,300,563. The Company has made an application to the Central Government for excess remuneration paid and pending approval has treated the excess remuneration paid as a recoverable.

2. Operating lease as lessee

The Company has entered into leases for cars for a period of 3 years. Total lease payments for non-cancellable leases recognized in the books for the year is Rs. 640,800 (2015 : Rs. 574,095)

3. Dues to Micro and Small Enterprises

Under Micro, Small, and Medium Enterprises Development Act, 2006 (MSMED) which came in to force from 2 October, 2006, certain disclosures are required to be made relating to micro and small enterprises. On the basis of the information and records available with the management, the following disclosures are made for the amounts due to the Micro, small and medium enterprises:

4. In accordance with AS-29 (Provisions, Contingent Liabilities and Contingent Assets), the movement in provision for warranty is as follows:

A provision is estimated for expected warranty claims in respect of products sold during the year on the basis of past experience regarding failure trends of products and costs of rectification or replacement. It is expected that most of this cost will be incurred over the next 12 months as per management estimate.

As per provisions of section 135 of Companies Act 2013, the Company was required to spend Rs. 2,556,520 (2015: Rs 2,791,425) being 2% of average net profits made during the three immediately preceding financial years, in pursuance of its Corporate Social Responsibility Policy on the activities specified in Schedule VII of the Act. However, the Company has spent Rs. 434,205 (2015: Nil) towards Corporate Social Responsibility activities. The Company is in process of exploring various options specified in Schedule VII on which it could do its spending of CSR for the benefit of society.

a) Gross amount required to be spent by the Company during the year - Rs. 2,556,520

b) Amount spent during the year on :

5 Transfer Pricing

The Company has developed a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The management is of the opinion that its international transactions are at arm’s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

During the financial year the company has applied for Advance Pricing Agreement (APA) before the Central Board of Direct Tax (CBDT) and Government of India (GOI) for International Inter-company related party transactions with associated Enterprises (AE). The APA is an arrangement between the taxpayer and the tax authority covering future transactions, with a view to avoid the potential transfer pricing disputes in a cooperative manner. Once APA agreement is completed, the company will have certainty with respect to tax outcome of international transactions, by agreeing in advance the arm’s length pricing, or pricing methodology which is to be applied. Under APA specific rollback provisions enable to attain certainty in transfer prices of international transactions for up to 9 years (including 4 years rollback provisions) in total. The company has applied for Advanced Pricing Agreement (APA) in FY 2015-16, the period covered under rollback is from FY 2012-13 to FY 2015-16 and five year down the line i.e. from FY 2016-17 to 2020-21. Besides this the APA has a persuasive value on all open Transfer pricing litigations of past years.

The Domestic Transfer Pricing Regulations as prescribed under section 92BA of the Income Tax Act, 1961 was introduced from April 1, 2012. The Company has been consistently transacting with related parties on an Arm’s Length basis in accordance with Group Transfer Pricing Policy. The Company is of the opinion that there will be no significant changes to Arm’s length price under determination in order to comply with the requirement of section 92BA of Income Tax Act. Hence, there will no material impact on the financial statements.

1. Employee benefits – Post employment benefit plans

Effective 1 January 2007, the Company adopted Accounting Standard 15 (revised 2005) on "Employee Benefits".

Defined contributions plans

The Company makes contributions, determined as specified percentage of employee salaries, in respect of qualifying employees towards Provident Fund and Superannuation Scheme, which is a defined contribution plan. The Company has no obligations other than to make the specified contributions. The contributions are charged to the Statement of Profit and Loss as they accrue. The amount as an expense towards contribution to Provident Fund and Superannuation Scheme for the year aggregated to Rs. 5,375,735 (2014: Rs. 4,964,801).

Defined benefit plans Gratuity

The Company operates post employment defined benefit plans that provide gratuity benefit. The gratuity plan entitles an employee, who has rendered at least five years of continuous service, to receive 15 days salary for each year of completed service at the time of retirement / exit. The scheme is funded by plan assets.

a) Gratuity is payable to all eligible employees of the Company on superannuation, death, and permanent disablement, in terms of the provisions of the Payment of Gratuity Act, 1972.

b) The discount rate is based on the prevailing market yields Indian Government securities as at the Balance Sheet date for the estimated term of the obligations.

c) Estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

d) The Company's gratuity fund is managed by Life Insurance Corporation of India. The plan assets under the fund are invested under approved securities.

2. Operating lease as lessee

The Company has entered into leases for cars for a period of 3 years. Total lease payments for non-cancellable leases recognized in the books for the year is Rs. 574,095 (2014 : Rs. 786,421)

3. Unhedged foreign currency exposures

The Company has entered into derivative contracts to hedge its risk associated with foreign currency fluctuations. However, none of these contracts can be co-related on one to one basis against the underlying exposure. As at the year end, the Company has outstanding foreign exchange forward contracts of GBP Nil, EURO Nil and USD Nil (2014: GBP 210,000), (2014: EURO 150,000), (2014: USD Nil) equivalent to Rs Nil (2014: Rs. 33,932,436). The Company has revalued these forward contracts as at the yearend by marking the same to market and recognized a loss of Rs.Nil (2014: Nil) by debiting the statement of profit and loss in compliance with the announcement dated 29 March 2008 made by the Institute of Chartered Accountants of India ('ICAI') regarding accounting for derivatives.

4. In accordance with AS-29 (Provisions, Contingent Liabilities and Contingent Assets), the movement in provision for warranty is as follows:

A provision is estimated for expected warranty claims in respect of products sold during the year on the basis of past experience regarding failure trends of products and costs of rectification or replacement. It is expected that most of this cost will be incurred over the next 12 months as per management estimate.

5. Corporate social responsibility

As per provisions of section 135 of Companies Act 2013, the Company was required to spend Rs. 2,791,425 (2014: Rs Nil) being 2% of average net profits made during the three immediately preceding financial years, in pursuance of its Corporate Social Responsibility Policy on the activities specified in Schedule VII of the Act. However, the Company has spent Rs Nil (2014: Nil) towards Corporate Social Responsibility activities. The Company is in process of exploring various options specified in Schedule VII on which it could do its spending of CSR for the benefit of society.

6. Transfer Pricing The Company has developed a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The management is of the opinion that its international transactions are at arm's length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

The Domestic Transfer Pricing Regulations as prescribed under section 92BA of the Income Tax Act, 1961 was introduced from April 1, 2012. The Company has been consistently transacting with related parties on an Arm's Length basis in accordance with Group Transfer Pricing Policy. The Company is of the opinion that there will be no significant changes to Arm's length price under determination in order to comply with the requirement of section 92BA of Income Tax Act. Hence, there will no material impact on the financial statements.

1. Background

Morganite Crucible (India) Limited (''the Company'') was incorporated on 13 January 1986 under the Companies Act, 1956 and its shares are listed on the Bombay Stock Exchange (BSE). The Company is engaged in the business of manufacturing and selling of silicon carbide and clay graphite crucibles, its accessories and die lubes.

2. Rights, preferences and restrictions 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 dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

The Company has proposed dividend per share of Re. 1 (2013: Re.1) for distribution to equity shareholders.

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.

3. Contingent liabilities and commitments

31 March 2014 31 March 2013

Contingent Liabilities:

a. Bonds in favour of the President 10,000,000 10,000,000 of India endorsed through Deputy Commissioner of Customs for import of goods.

b. Claims by employees towards unfair labour practices under Section 28 read with items 1(a), (b), (c), 2 (b), 3, 4(a), (e) and (f) of Schedule II and items 5, 6, 9 and - - 10 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 for which amounts are not ascertainable.

c. Disputed employees'' state insurance demand aggregating Rs.52,498 (2013: 52 498 52 498 Rs.52,498) against which the Company has preferred appeals.

Commitments:

a. Estimated amount of contracts remaining to be executed on capital account and not 558,701 3,791,851 provided for

1 Employee benefits - Post employment benefit plans Effective 1 January 2007, the Company adopted Accounting Standard 15 (revised 2005) on "Employee Benefits".

Defined contributions plans

The Company makes contributions, determined as specified percentage of employee salaries, in respect of qualifying employees towards Provident Fund and Superannuation Scheme, which is a defined contribution plan. The Company has no obligations other than to make the specified contributions. The contributions are charged to the statement of profit and loss as they accrue. The amount as an expense towards contribution to Provident Fund and Superannuation Scheme for the year aggregated to Rs. 4,964,801 (2013: Rs. 4,775,021).

Defined benefit plans

Leave encashment

Amount of Rs. 835,756 (2013: Rs. 2,766,334) is recognised as an expense and included in "Employee costs" in the statement of profit and loss.

Gratuity

The Company operates post employment defined benefit plans that provide gratuity benefit. The gratuity plan entitles an employee, who has rendered at least five years of continuous service, to receive 15 days salary for each year of completed service at the time of retirement / exit. The scheme is funded by plan assets.

a) Gratuity is payable to all eligible employees of the Company on superannuation, death, and permanent disablement, in terms of the provisions of the Payment of Gratuity Act, 1972.

b) The discount rate is based on the prevailing market yields Indian Government securities as at the balance sheet date for the estimated term of the obligations.

c) Estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

d) The Company''s gratuity fund is managed by Life Insurance Corporation of India. The plan assets under the fund are invested under approved securities.

4 Related party disclosures A. Names of related parties

a. Parties (where controls exists) Morgan Advanced Materials Plc ( formerly known as The Morgan Crucible Company Plc UK) - Ultimate Holding Company

b. Investing Associates

Morganite Crucible Limited (holds 38.50% of issues, subscribed and paid up capital)

Morgan Terreassen BV (holds 36.50% of issues, subscribed and paid up capital)

c. Other related parties with whom transactions have taken place during the year

i. Subsidiary company Diamond Crucible Company Limited

ii. Fellow subsidiary companies Morganite Crucible Inc., USA

Morgan Molten Metal System GMBH Germany Morgan Molten Metal System (Suzhou) Co Ltd., China Morgan Karbon Grafit Sanayi Turkey Thermal Ceramics UK

Murugappa Morganite Thermal Ceramics Ltd.

Thermal Ceramics South Africa

d. Key Management Person Mr. Hitesh Saiwal - Managing Director

5 Operating lease as lessee

The Company has entered into leases for cars for a period of 3 years. Total lease payments for non-cancellable leases recognised in the books for the year is Rs. 786,422 (2013 : Rs. 1,299,650)

6 Unhedged foreign currency exposures

The Company has entered into derivative contracts to hedge its risk associated with foreign currency fluctuations. However, none of these contracts can be co-related on one to one basis against the underlying exposure. As at the year end, the Company has outstanding foreign exchange forward contracts of GBP 210,000, EURO 150,000 and USD Nil (2013: GBP Nil), (2013: EURO 900,000), (2013: USD 900,000) equivalent to Rs.33,932,436 (2013: Rs. 111,501,000). The Company has revalued these forward contracts as at the year end by marking the same to market and recognised a loss of Rs.NIL (2013: Nil) by debiting the statement of profit and loss in compliance with the announcement dated 29 March 2008 made by the Institute of Chartered Accountants of India (''ICAI'') regarding accounting for derivatives.

7 Transfer Pricing

The Company has developed a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The management is of the opinion that its international transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

The Domestic Transfer Pricing Regulations as prescribed under section 92BA of the Income Tax Act, 1961 was introduced from April 1, 2012. The Company has been consistently transacting with related parties on an Arm''s Length basis in accordance with Group Transfer Pricing Policy. The Company is of the opinion that there will be no significant changes to Arm''s length price under determination in order to comply with the requirement of section 92BA of Income Tax Act. Hence, there will no material impact on the financial statements.

1. Background

Morganite Crucible (India) Limited (''the Company'') was incorporated on 13 January 1986 under the Companies Act, 1956 and its shares are listed on the Bombay Stock Exchange (BSE). The Company is engaged in the business of manufacturing and selling of silicon carbide and clay graphite crucibles, its accessories and die lubes.

2. Employee benefits – Post employment benefit plans

I. Effective 1 January 2007, the Company adopted Accounting Standard 15 (revised 2005) on "Employee Benefits".

II. Defined contributions plans The Company makes contributions, determined as specified percentage of employee salaries, in respect of qualifying employees towards Provident Fund and Superannuation Scheme, which is a defined contribution plan. The Company has no obligations other than to make the specified contributions. The contributions are charged to the statement of profit and loss as they accrue. The amount as an expense towards contribution to Provident Fund and Superannuation Scheme for the year aggregated to Rs. 4,775021 (2012: Rs. 4,922,963).

Leave Encashment

Amount of Rs.2,766,334 (2012: Rs. 2,237,647) is recognised as an expense and included in "Employee costs" in the statement of profit and loss.

Gratuity

The Company operates post employment defined benefit plans that provide gratuity benefit. The gratuity plan entitles an employee, who has rendered at least five years of continuous service, to receive 15 days salary for each year of completed service at the time of retirement / exit. The scheme is funded by plan assets.

3. Segment reporting

The Company recognizes its sale of crucibles activity as its only primary business segment since its operations predominantly consist of manufacture and sale of crucibles to its customers. Accordingly, income from sale of crucibles comprises the primary basis of segmental information set out in these financial statements. Geographical segment will be the secondary segment for the purpose of AS-17 (Segment reporting). All the assets of the Company are located in India except for Trade receivables and advance to suppliers aggregating Rs.87,145,522 (2012: Rs. 104,807,237). The Company caters to the needs of the domestic and foreign market.

4. Related party disclosures

A. Names of related parties

Parties (where controls exists)

The Morgan Crucible Company Plc, U.K - Ultimate Holding Company b. Investing Associates

- Morganite Crucible Limited (holds 38.50% of issues, subscribed and paid up capital)

- Morgan Terreassen BV (holds 36.50% of issues, subscribed and paid up capital) Other related parties with whom transactions have taken place during the year

- Subsidiary company Limited Diamond Crucible Company

- Fellow subsidiary companies Morganite Crucible Inc., USA

Morgan Molten Metal System GMBH Germany Morgan Molten Metal System (Suzhou) Co Ltd., China Morgan Karbon Grafit Sanayi Turkey Thermal Ceramics UK

Murugappa Morganite Thermal Ceramics Ltd. Thermal Ceramics South Africa d. Key Management Person

Mr. Hitesh Saiwal - Managing Director

5. Operating leases as lessee

The Company ha s entered into operating leases for cars for a period of 3 years. Total lease payments for non - cancellable leases recognised in books for the year is Rs.1,299,650 (2012 : Rs.1,447,836).

6. Dues to Micro and Small Enterprises

Under Micro, Small, and medium Enterprises Development Act, 2006 (MSMED) which came in to force from 2 October, 2006, certain disclosures are required to be made relating to micro and small enterprises. On the basis of the information and records available with the management, the following disclosures are made for the amounts due to the Micro, small and medium enterprises:

On the basis of information and records available with the Company, the above disclosures are made in respect of amounts due to the micro, small and medium enterprises, who have registered with the relevant competent authorities. This has been relied upon by the auditors.

7. Unhedged foreign currency exposures

The Company has entered into derivative contracts to hedge its risk associated with foreign currency fluctuations. However, none of these contracts can be co-related on one to one basis against the underlying exposure. As at the year end, the Company has outstanding foreign exchange forward contracts of GBP Nil, EURO 900,000 and USD 900,000 (2012: GBP 725,000), (2012: EURO 825,000), (2012: USD 639,073) equivalent to Rs.111,501,000 (2012: Rs. 148,226,427). The Company has revalued these forward contracts as at the year end by marking the same to market and recognised a loss of Rs.NIL (2012: Rs.4,976,182) by debiting the statement of profit and loss in compliance with the announcement dated 29 March 2008 made by the Institute of Chartered Accountants of India (''ICAI'') regarding accounting for derivatives.

8. Transfer Pricing

The Company''s management is of the opinion that its international transactions are at arm''s length as per the independent accountants report for the year ended 31 March 2012. Further, the Indian Finance Bill, 2012 had sought to bring in certain class of domestic transactions in the ambit of the transfer pricing regulations with effect from 1st April 2012. The management is yet to carry out a detailed domestic / international transfer pricing study/ analysis for the year ending 31 March 2013 in accordance with these regulations and expects to commission and complete the same by the specified due date. Management continues to believe that its international transactions post March 2012 and the specified domestic transactions covered by the new regulations are at arm''s length and that the transfer pricing legislation will not have any impact on these financial statements, particularly on amount of tax expense and that of provision of taxation.

9. Change in Accounting Policy

With effect from 1 April 2012 the Company has changed its accounting policy for valuation of inventories from First in First Out (FIFO) method to Weighted Average Cost (WAC) method. This has resulted in figures for the year ended 31 March 2013, for ''Cost of materials consumed being lower by Rs. 1,256,485, ''Changes in inventories of finished goods, work in progress and stock-in-trade being lower by Rs. 1,157,275 and ''Net Profit for the year'' being higher by Rs.1,630,614. If the FIFO method of valuation of inventories would have been followed, the figures for the year ended 31 March 2013 for ''Cost of materials consumed would have been Rs.328,500,586, ''Changes in inventories of finished goods, work-in-progress and stock-in-trade'' would have been Rs.24,714,611 and ''Net Profit for the year'' would have been Rs.83,890,007.

10. Previous year figures

Previous year''s figure have been regrouped / reclassified as follows:

- Provision for tax aggregating to Rs. 1,753,847 has been reclassified from "Long-term provisions" to "Short-term provision (net of advance tax and tax deducted at source)".

Provision for tax aggregating to Rs. 1,553,663 has been reclassified from "Short-term provisions" to "Long-term loans and advances (net of provisions)".

1. Background

Morganite Crucible (India) Limited ('the Company') was incorporated on 13 January 1986. The Company is engaged in the business of manufacturing and selling of silicon carbide and clay graphite crucibles and its accessories.

Terms / 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 dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

The Company has proposed per share dividend of Re.1 (2011: Rs.Nil) for distribution to equity shareholders.

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.

Details of shares held by shareholders holding more than 5% of the aggregate shares in the Company.

The only shareholders holding more than 5 percent shares as on the date of the balance sheet are Morganite Crucible Limited and Morgan Treason BV (as disclosed above), both of which are subsidiaries of The Morgan Crucible Company Plc.

"Management charges for the current year includes charges pertaining to previous year amounting to Rs.15,185,332.

2. Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.9,712,297 (2011: Rs. 4,025,000).

3. Contingent liabilities

i) Bonds aggregating Rs.10,000,000 (2011: Rs.10,000,000) in favor of the President of India endorsed through Deputy Commissioner of Customs for import of goods.

ii) Claims by employees towards unfair labour practices under Section 28 read with items 1(a), (b), (c), 2 (b), 3, 4(a), (e) and (f) of Schedule II and items 5, 6, 9 and 10 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 for which amounts are not ascertainable.

iii) Disputed employees' state insurance demand aggregating Rs.52,498 (2011: Rs.52,498) against which the Company has preferred appeals.

4. The Company's operations consist of manufacturing and selling of crucibles and hence the information with regards to sales effected by the Company and the information with regard to opening and closing stock of finished goods as disclosed in the financial statements pertains to crucibles only.

**The value of consumption of raw materials has been arrived at on the basis of opening stock plus purchases less closing stock. The consumption, therefore, includes adjustments for raw materials write-off, shortage / excess, etc.

5. Employee benefits

I. Effective 1 January 2007, the Company adopted Accounting Standard 15 (revised 2005) on "Employee Benefits".

II. Contribution to Provident fund

Amount of Rs.3,167,663 (2011: Rs.2,638,039) is recognized as an expense and included in "Employee costs" in the statement of profit and loss.

Experience adjustment is on account of attrition in the number of employees as compared to the previous year and change in actuarial assumptions.

The estimates of future salary increases, considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors, such as supply and demand and the employment market.

G Percentage of each category of Plan Assets to total Fair Value of Plan Assets as at 31 March 2012.

The Plan Assets are administered by Life Insurance Corporation of India ("LIC") as per Investment Pattern stipulated for Pension and Group Schemes Fund by Insurance and Regulatory Development Authority regulations.

The discount rate is based on the prevailing market yields on Indian government securities as at the balance sheet date for the estimated term of obligation.

6. Segment reporting

The Company recognizes its sale of crucibles activity as its only primary business segment since its operations predominantly consist of manufacture and sale of crucibles to its customers. Accordingly, income from sale of crucibles comprises the primary basis of segmental information set out in these financial statements. Geographical segment will be the secondary segment for the purpose of AS-17 (Segment reporting). All the assets of the Company are located in India except for Trade receivables aggregating Rs.104,807,237 (2011: Rs.68,049,633). The Company caters to the needs of the domestic and foreign market.

7. Related party disclosure

List of related parties

i. Parties (where control exists)

The Morgan Crucible Company Plc., U.K. - Ultimate holding company

ii. Investing associates

- Morganite Crucible Limited (holds 38.50% of issued, subscribed and paid up capital)

- Morgan Treason BV (holds 36.50% of issued, subscribed and paid up capital)

iii. Other related Parties where transactions have taken place during the year

Subsidiary company

- Diamond Crucible Company Limited Fellow subsidiary companies

- Morganite Crucible Inc., USA

- Morgan Molten Metal Systems GMBG Germany

- Morgan Molten Metal System (Suzhou) Co. Ltd., China

- Morgan Karbon Grafit Sanayi AS Turkey

- Thermal Ceramics UK

- Murugappa Morganite Thermal Ceramics Limited

- Morgan Thermal Ceramics - Shanghai

iv. Key Management Personnel

- Mr. Vijay Sabarwal - CEO and Whole time Director (upto 29 January 2011)

- Mr. Ashish Mehrotra - Director sales and marketing

- Mr. Vinod Mhalsekar - Director operations

- Mr.Hitesh Saiwal - Wholetime Director / Country Manager (from 17 May 2010)

8. The Company has entered into operating leases for cars for a period of 3 years. Total lease payments for non-cancellable leases recognised in books for the year is Rs.1,447,836 (2011: Rs.747,799).

9. Dues to Micro, Small and Medium Enterprises

Under Micro, Small, and Medium Enterprises Development Act, 2006 (MSMED) which came in to force from 2 October, 2006, certain disclosures are required to be made relating to Micro, Small and Medium enterprises.

On the basis of the information and records available with the management, the following disclosures are made for the amounts due to the Micro, small and medium enterprises:

10. Receivables and payables denominated in foreign currency

The Company has entered into derivative contracts to hedge its risk associated with foreign currency fluctuations. However, none of these contracts can be co-related on one to one basis against the underlying exposure. As at the year end, the Company has outstanding foreign exchange forward contracts of GBP 725,000, EURO 825,000 and USD 639,073 (2011: GBP 500,000) equivalent to Rs.148,226,427 (2011: Rs.36,075,000). The Company has revalued these forward contracts as at the yearend by marking the same to market and recognized a loss of Rs.4,976,182 (2011: Rs.107,000) by debiting the statement of profit and loss in compliance with the announcement dated 29 March 2008 made by the Institute of Chartered Accountants of India ('ICAI') regarding accounting for derivatives.

11. Transfer Pricing

Transactions with overseas related parties are governed by transfer pricing regulations of the Indian Income tax Act, 1961. The Company's international transactions with associated enterprises are at arm's length as per the independent accountants' report for the year ended 31 March 2011. Management believes that the Company's international transactions with related parties post 31 March 2011 continue to be at arm's length and that the transfer pricing legislation will not have any impact on the financial statements particularly on the amount of the tax expense for the year and the amount of the provision for taxation at the year end.

12. Previous year figures

The financial statements for the year ended 31 March 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Act. Consequent to the notification of Revised Schedule VI under the Act, the financial statements for the year ended 31 March 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements.

1. Background

Morganite Crucible (India) Limited ('the Company') was incorporated on 13 January 1986. The Company is engaged in the business of manufacturing and selling of silicon carbide and clay graphite crucibles and its accessories.

2. Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.4,025,000 (2010: Rs.6,176,056).

3. Contingent liabilities

i) Bank guarantee aggregating Rs. Nil (2010:Rs. 200,000) issued by the bank on behalf of the Company in favour of the Panalpina World Transport Private Limited for purchase of Material from Thermal Ceramic U.K. Limited.

ii) Bonds aggregating Rs.10,000,000 (2010: Rs.10,000,000) in favour of the President of India endorsed through Deputy Commissioner of Customs for import of goods.

iii) A suit has been filed by Mr. Suresh Borade, past employee of the Company, on account of his disputed resignation from the Company. The Honourable Gujarat High Court has ordered to pay Rs.540 per month till the final disposal of appeal pending for reinstatement with back wages. The Company is presently paying the above mentioned Rs.540 per month to the said employee. The amount of liability that may arise in future on account of reinstatement with back wages is not ascertainable.

iv) Claims by employees towards unfair labour practices under Section 28 read with items 1(a), (b), (c), 2 (b), 3, 4(a), (e) and (f) of Schedule II and items 5, 6, 9 and 10 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 for which amounts are not ascertainable.

v) Disputed employees' state insurance demand aggregating Rs. 52,498 against which the Company has preferred appeals.

Experience adjustment is on account of attrition in the number of employees as compared to the previous year and change in actuarial assumptions.

The estimates of future salary increases, considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors, such as supply and demand and the employment market.

G. Percentage of each category of Plan Assets to total Fair Value of Plan Assets as at 31 March 2011.

The Plan Assets are administered by Life Insurance Corporation of India (“LIC”) as per Investment Pattern stipulated for Pension and Group Schemes Fund by Insurance and Regulatory Development Authority regulations.

The discount rate is based on the prevailing market yields on Indian government securities as at the balance sheet date for the estimated term of obligation.

4. Segment reporting

Primary segment:

In accordance with the requirements of Accounting Standard 17 – “Segment Reporting”, the Company has determined its business segment as crucibles. Since 100% of the Company's business is from crucibles, there are no other primary reportable segments. Thus the segment revenue, segment result, total carrying amount of segment assets, total carrying amount of segment liabilities, total cost incurred to acquire segments assets, the total amount of charge for depreciation and amortisation during the year are all as reflected in the financial statements for the year ended 31 March 2011 and as on that date.

5. Related party disclosure

List of related parties

i. Parties (where control exists)

The Morgan Crucible Company Plc, U.K. - Ultimate holding company

ii. Investing associates

Morganite Crucible Limited (holds 38.50% of issued, subscribed and paid up capital) Morgan Terreassen BV (holds 36.50% of issued, subscribed and paid up capital)

iii. Other related Parties where transactions have taken place during the year

Subsidiary company

Diamond Crucible Company Limited Fellow subsidiary companies

Morganite Crucible Inc., USA

Morgan Molten Metal Systems GMBG Germany

Morgan Thermic SAS, France

Morgan Molten Metal System (Suzhou) Co. Ltd., China

Morgan Karbon Grafit Sanayi AS Turkey

Thermal Ceramics UK

Morganite Brazil LtdA

Morgan Thermal Ceramics - Shanghai

iv. Key Management Personnel

- Mr. Vijay Sabarwal – CEO and Wholetime director (upto 29 January 2011)

- Mr. Ashish Mehrotra – Director sales and marketing

- Mr. Vinod Mhalsekar – Director operations

- Mr.Hitesh Saiwal – Country head and Wholetime director (from 17 May 2010)

6. Dues to Micro, Small and Medium Enterprises

Under Micro, Small, and Medium Enterprises Development Act, 2006 (MSMED) which came in to force from 2 October, 2006, certain disclosures are required to be made relating to Micro, Small and Medium enterprises.

7. Receivables and payables denominated in foreign currency

The Company has entered into derivative contracts to hedge its risk associated with foreign currency fluctuations. However, none of these contracts can be co-related on one to one basis against the underlying exposure. The Company has outstanding foreign exchange forward contracts of GBP 500,000 equivalent to Rs.36,075,000 as at 31 March 2011. The Company has revalued these forward contracts as at the year end by marking the same to market and recognised a loss of Rs.107,000 by debiting profit and loss account in compliance with the announcement dated 29 March 2008 made by the Institute of Chartered Accountants of India ('ICAI') regarding accounting for derivatives.

8. Transfer Pricing

The Company's management is of the opinion that its international transactions with related parties are at arms length and that the Company is in compliance with the transfer pricing legislation. Based on the above, the Company's management believes that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of the provision for taxation.

9. The Company has availed exemption as applicable to Export Oriented companies, granted by notification no. S.O. 301 (E) dated 8 February 2011 issued by Ministry of Corporate Affairs, Government of India. The Board of Directors have given their consent to avail the said exemption in their meeting held on 30 March 2011. Hence, the disclosures required by paragraphs 3(i)(a), 3(ii)(a), 3(ii)(b) and 3(ii)(d) of Part-II of Schedule VI to the Companies Act, 1956 have not been made.

10. Prior year figures which were audited by a firm of Chartered Accountants other than B S R & Co. have been regrouped / rearranged wherever necessary to conform to current year's presentation.

1. Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 6,176,056 (Previous Year Rs. 1,800,000).

2. Contingent liabilities

i) Bank guarantee aggregating Rs. Nil (Previous Year Rs. 10,000) issued by the bank on behalf of the Company in favour of Maharashtra Pollution Control Board for compliance of the Supreme Court Monitoring Committee directions regarding Common Effluent Treatment Plant at Waluj MIDC.

ii) Bank guarantee aggregating Rs. 200,000 (Previous Year Rs. 200,000) issued by the bank on behalf of the Company in favour of the Panalpina World Transport Private Limited for purchase of Material from Thermal Ceramic U.K. Limited.

iii) Bonds aggregating Rs. 10,000,000 (Previous Year Rs. 10,000,000) in favour of the President of India endorsed through Deputy Commissioner of Customs for import of goods.

iv) Disputed income tax demands aggregating Rs. Nil (Previous Year Rs. 431,291) against which the Company has preferred appeals.

v) Claims by employees towards unfair labour practices under Section 28 read with items 1(a), (b), (c), 2 (b), 3, 4(a), (e) and (f) of Schedule II and items 5, 6, 9 and 10 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 for which amounts are not ascertainable.

vi) A suit has been filed by a past employee of the Company, on account of his disputed resignation from the Company. The amount of liability that may arise in future on account of reinstatement with back wages is approximately Rs. 880,000.

vii) Disputed employees state insurance demand aggregating Rs. 52,498 against which the Company has preferred appeals.

a) Vide letter No. 4097/SIA/IMO/96 dated October 24, 1996 received from Government of India, Ministry of Industry – Secretariat for Industrial Approvals Entrepreneurial Assistance Unit. In June 2010, the Company has filed an application for submission to the Central Government in the Secretariat for Industrial Assistance to increase the annual licensed capacity from 3,600 M.T. to 5,100 M.T for silicon carbide crucibles for which approval is awaited.

b) Vide letter No. CIL 54(2000) dated August 31, 2000 received from Government of India, Ministry of Commerce & Industry – Department of Industrial Policy & Promotion, Secretariat for Industrial Assistance (PAB – IL Section).

c) Installed capacity is as certified by the Management on which auditors have placed reliance without verification, this being a technical matter.

3. Components and spare parts referred to in paragraph 4D(a) and (c) of part II of Schedule VI to the Companies Act, 1956, are assumed to be those incorporated in the goods purchased and not those used for maintenance of plant and machinery.

G. Percentage of each category of Plan Assets to total Fair Value of Plan Assets as at March 31, 2010.

The Plan Assets are administered by Life Insurance Corporation of India ("LIC") as per Investment Pattern stipulated for Pension and Group Schemes Fund by Insurance and Regulatory Development Authority regulations.

H. Expected gratuity contribution for the next year is aggregating Rs. 588,966 (Previous Year Rs. 612,526). III The liability for leave encashment (Net) as at the year end is Rs. 441,087 (Previous Year Rs. 1,090,027).

4. Segment reporting Primary segment:

In accordance with the requirements of Accounting Standard 17 – "Segment Reporting" issued by the Institute of Chartered Accountants of India, the Company has determined its business segment as crucibles. Since 100% of the Companys business is from crucibles, there are no other primary reportable segments. Thus the segment revenue, segment result, total carrying amount of segment assets, total carrying amount of segment liabilities, total cost incurred to acquire segments assets, the total amount of charge for depreciation and amortisation during the year are all as reflected in the financial statements for the year ended March 31, 2010 and as on that date.

5. Related party disclosure

Related party disclosure as required by Accounting Standard - 18, "Related Party Disclosures" issued by the Institute of Chartered Accountants of India is given below:

i. Shareholders in the company

Morganite Crucible Limited holds 38.50% and Morgan Terreassen BV holds 36.50% equity shares of the Company.

ii. Other related Parties where common control exists and transactions have taken place during the year Subsidiary Company

- Diamond Crucible Company Limited Fellow subsidiary Companies

- Morganite Crucible Inc., USA

- Carl Nolte Sohne GmbH, Germany

- Morgan Thermic SAS, France

- Morgan Molten Metal System (Suzhou) Co. Ltd., China

- Mkgs. Morgan Carbon, Turkey

- Thermal Ceramics South Africa (PTY) Ltd.

- Morganite Brazil LtdA Ultimate Holding Company

- The Morgan Crucible Company Plc, U.K.

iii. Key Management Personnel

- Mr. Vijay Sabarwal (Executive Director)

- Mr. Ashish Mehrotra

- Mr. Basant Agrawal

- Mr. Vinod Mhalsekar (with effect from January 15, 2009)

- Mr. Md. Abdul Nadeem (upto May 31, 2009)

- Mr. O. S. Joshi (upto September 6, 2008)

- Mr. H. K. Bajpayee (upto April 6, 2008)

- Mr. Ghanshyam Rathi (with effect from April 1, 2009)

- Mr. Laxmi Ganesh (with effect from April 1, 2009)

- Mr. Sonalsing Gujar (with effect from April 1, 2009)

6. Sundry Creditors

i) Disclosure has been made as per the definition given in the Micro, Small and Medium Enterprises Development Act, 2006.

The Company has not received any information from the "suppliers" regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures, if any, relating to the amounts as at year end together with interest paid / payable as required under the said Act have not been given.

7. The amount of excise duty disclosed as deduction from turnover is the total excise duty for the year except the excise duty related to the difference between the closing stock and opening stock and excise duty paid but not recovered, which has been disclosed as excise duty expense in "Cost of materials - Increase / (Decrease) in excise duty on finished goods" under Schedule 9 forming part of the Profit and Loss Account.

8. As at the year end the Company -

i) has no loans and advances in the nature of loans to associates.

ii) has no loans and advances in the nature of loans, wherein there is no repayment schedule or repayment is beyond seven years and

iii) has no loans and advances in the nature of loans to firms / companies in which directors are interested.

9. Previous years figures have been regrouped / rearranged wherever necessary to confirm to the current years classification.