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అకౌంట్స్ గమనికలుRajputana Stainless Ltd.
M. Provisions, Contingent Liabilities and Contingent AssetsI. Provisions:
A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that
can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash
flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the
liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance
cost.
A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but
probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation in respect
of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
Contingent assets are not recognized in the financial statements. However, contingent assets are assessed continually
and if it is virtually certain that an inflow of economic benefits will arise, the asset and related income are recognized in
the period in which the change occurs.
Basic earnings per share is computed by dividing the net profit for the period attributable to the equity shareholders of
Company by the weighted average number of equity shares outstanding during the period. The weighted average number
of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares,
other than the conversion of potential equity shares that have changed the number of equity shares outstanding, without a
corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit for the period
attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for
the effects of all dilutive potential equity shares.
Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of
a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or
expenses associated with investing or financing cash flows. The cash flows are segregated into operating, investing and
financing activities.
Cash and cash equivalents in the Balance Sheet comprise cash at bank and in hand and short-term deposits with banks that
are readily convertible into cash which are subject to insignificant risk of changes in value and are held for the purpose of
meeting short-term cash commitments.
Operating Segment are reported in a manner consistent with the internal reporting provided to the Chief operating decision
maker (CODM). Identification of segments: In accordance with Ind AS 108 "Operating Segment", the operating segment used
to present segment information reviewed by CODM to allocate resources to the segments and assess their performance. An
operating segment is a component of the company that engages in the business activities from which it earns revenues and
incurs expenses, including revenues and expenses that relate to transactions with any of the Company''s other components.
1 Second charge by way of hypothecation on entire assets present and future of the company with other consortium bank.
Second charge by way of mortgage and hypothecation on fixed asset of the company(both movable and immovable asset
of the company) except vehicles finance by the Bank/FI/NBFC.
2 Mortgage on property of office no. T-06-Indiabulls Mega Mall, Vadodara and Revenue survey no. 537 of Magnad, Jambusar,
Bharuch.
3 In the opinion of the board of director all the current assets, investments loans and advances recoverable in cash or kind are
stated at values realisable in the ordinary course of business of the company and all the known liabilities have been provided
for and there are no liabilities contingent or otherwise except those which are stated in the account.
4 The company has taken into account the impact of any significant event that occurs after balance sheet date and the date on
which the financial statements are approved by the Board of Directors.
5 No assets have been identified which have been impaired in respect of each cash generating unit. Hence, no impairment loss
has been provided in the books.
The Company has entered into certain operating lease arrangements for office premises and plant and machinery
(short-term leases). Rental expenses amounting to ''4.98 lakhs (31 March 2025: ''10.70 lakhs) towards these operating
lease obligations have been recognized in the Statement of Profit and Loss.
The Company has taken land on lease for setting up a solar power plant and for land situated at Madvas. These
arrangements have been classified as long-term leases under Ind AS 116 - Leases.
Lease Term: 25 years (Solar Plant Land) and 20 years (Madvas Land).
Recognition: Corresponding lease liabilities and right-of-use (ROU) assets have been recognised in the Balance Sheet.
Measurement: Lease liabilities have been measured using an incremental borrowing rate of 11.25%.
10 The company makes contributions, determined as specific percentage of employee salaries, towards Provident Fund,
Employee State Insurance Scheme(ESI). The contributions are charged to the Statement of Profit and Loss as they accrue.
The company provides for gratuity payable to eligible employees. The company has neither created any gratuity fund trust
nor taken any policy from Insurance Company in this respect.
11 Ind AS 115-Revenue from Contracts with Customers
a. The Company is in the business of Manufacturing long and flat stainless-steel products comprising of billets, forging
ingots, rolled black bar, rolled bright bar, flat & patti and other ancillary products etc. All sales are made at a point in time
and Revenue is recognized on satisfaction of performance obligation upon transfer of control of promised products
or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for
those products or services. To recognize revenues.
Revenue from sale of goods measured upon satisfaction of performance obligation which is at a point in time when
control of the goods is transferred to the customer, generally on delivery of the goods.
12 Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The Managing Director of the Company has been identified as being the chief operating decision maker to assess
the financial performance and position of the Company and make strategic decisions. The Company is engaged primarily
Manufacturing of long and flat stainless-steel products comprising of billets, forging ingots, rolled black bar, rolled bright
bar, flat & patti and other ancillary products etc. Accordingly, in the context of Indian Accounting Standard 108 - Operating
Segments, it is considered to constitute single reportable segment.
Note related to Corporate Social Responsibility
1 The Company''s CSR initiatives shall focus on promoting education, including special education, and taking measures
for reducing inequalities faced by socially and economically backward groups; supporting animal welfare; eradicating
hunger, poverty, and malnutrition; and promoting health care, including preventive health care, with the objective of
contributing to inclusive growth and social development.
2 The Company''s CSR initiatives are focused on promoting education, reducing inequalities faced by socially and
economically backward groups, eradicating hunger and poverty, promoting good health and well-being, animal
welfare, protection of flora and fauna, preservation of cultural heritage, and fostering social cohesion and collective
community well-being. Through these initiatives, the Company aims to contribute towards inclusive and sustainable
development while creating a positive social and environmental impact in the communities in which it operates.
Reasons for variation more than 25%
1 The ratio decreased is mainly due to reduction in overall borrowings and improvement in shareholders'' equity
position.
2 The ratio increased is primarily due to increase in current assets and improvement in working capital position of the
Company.
3 The ratio decreased is mainly due to a proportionately higher increase in shareholders'' equity compared to the
increase in profit after tax.
4 The ratio decreased is primarily due to increase in net working capital, while growth in revenue from operations
remained comparatively moderate.
18 The Company do not have any such 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 or
any other relevant provisions of the Income Tax Act, 1961).
19 The Company do not have any Benami property, where any proceeding has been initiated or pending against the Company
for holding any Benami property.
20 The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
21 The Company do not have advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign
entities (Intermediaries) with the understanding that the Intermediary shall :
a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
company (Ultimate Beneficiaries) or.
b. provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
The financial instruments are categorised into three levels based on the inputs used to arrive at fair value
measurements as described below:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: Inputs other than the quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly; and
Level 3: Inputs based on unobservable market data.
All financial instruments are recognised at fair value as described below:
a) The fair value of investment in units of unquoted mutual funds is determined by reference to their prevailing net
asset values.
b) Derivative assets arising from forward contracts are measured at fair value in accordance with Ind AS 109 Financial
Instruments and Ind AS 113 Fair Value Measurement.
The company''s activities expose it to variety of Risks, i.e. financial risks: market risk, credit risk, interest rate risk and liquidity
risk.
The Company''s principal financial liabilities, other than derivatives, comprise borrowings, trade and other payables. The main
purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal financial assets include
trade and other receivables, and cash and cash equivalents that derive directly from its operations.
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in
market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity
price risk and commodity 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.
Foreign Currency Risk Sensitivity:
The sensitivity of profit or loss due to changes in the exchange rates arises mainly from non-derivative foreign
currency denominated financial instruments (mainly financial instruments denominated in USD currency). The
same is summarized as below:
I nterest 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. Company have exposure to the risk of changes in market interest rates as
Company''s debt obligations is at floting interest rates. Interest Rate Sensitivity on Interest Amounts is as follows.
The Company is not an active investor in equity markets, it holds certain investments in Mutual Fund which are
recognised to be liquidated in short term and are accordingly measured at fair value through Other Comprehensive
Income.
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet
its contractual obligations. The Company is exposed to credit risk from its operating activites (primarily trade receivables)
and from its financing / investing activities, including deposits with banks and mutual fund investments. The Company
has no significant concentration of credit risk with any counterparty.
The carrying amount of following financial assets represents the maximum credit exposure:
a) Trade receivables
The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer.
However, management also considers the factors that may influence the credit risk of its customer base, including
the default risk of the industry and country in which customers operate. The Company has a credit evaluation
policy for each customer and based on the evaluation, credit limit of each customer is defined. The Risk
Management Committee has established a credit policy under which each new customer is analysed individually
for creditworthiness before the Company''s standard payment and delivery terms and conditions are offered. The
Company''s review includes external ratings, if they are available, and in some cases bank references. Sale limits are
established for each customer and reviewed quarterly. Any sales exceeding those limits require approval from the
Managing Director.
b) Cash and Cash equivalents, bank balances and other financial assets
The Company maintains exposure in cash and cash equivalents and deposits with banks. Cash and cash
equivalents and bank deposits are held with high rated banks/financial institutions and short term in nature,
therefore credit risk is perceived to be low.
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is
to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal
and stressed conditions, without incurring unacceptable losses or risking damage to the Company''s reputation.
The majority of the Company''s trade receivables are due for maturity within 60 days from the date of billing to the
customer. Further, the general credit terms for trade payables are approximately 45 days. The difference between the
above mentioned credit period provides surplus working credit requirements.
The details of contractual maturities of significant financial liabilities are as follows:-
The Company manages its capital structure with a view that it will be able to continue as going concern while maximising the
return to stakeholders through the optimization of the debt and equity balance.
The capital structure of Company consists of net debt (borrowings as detailed in Note 15, 16 & 20 offset by Cash & Cash
Equivalents & other Bank Balance detailed in Note 10 & 11 and Investment in Mutual Funds as detailed in Note 7 and total
equity of the Company.
26 The Company do not have received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with
the understanding (whether recorded in writing or otherwise) that the Company shall:
a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
Funding Party (Ultimate Beneficiaries) or
b. provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
27 The title deeds/legal ownership of immovable properties as disclosed in the financial statements are held in the name of the
Company.
28 The Company has not been declared wilful defaulter by any bank or financial institution or government or any government
authority.
29 During the year ended March 31, 2026, the Company has completed its Initial Public Offer ("IPO") of 2,09,00,000 equity shares
of face value of '' 10/- each comprising of (i) fresh issue of 1,46,50,000 Equity Shares of face value of ''10 each aggregating
to ''17,873.00 lakhs; (ii) an offer for sale of 62,50,000 Equity Shares of face value of ''10 each aggregating to ''7,625.00 lakhs.
The equity shares of the Company were listed on BSE Limited ("BSE") and National Stock Exchange of India Limited ("NSE")
on March 19, 2026.
Out of the proceeds which were unutilised as at March 31, 2026, '' 11,657.00 lakhs are temporarily invested in Fixed Deposits,
'' 150.95 lakhs is held in the Company''s Monitoring Account, while the balance amount is of '' 284.15 Lakhs held in the
Company''s Escrow Account.
30 Dividends declared are based on the profit available for distribution. On May 25, 2026, the Board of Directors have
recommended a final dividend on Equity Shares @5% i.e. '' 0.50/- per share of face value of ''10/- each for the financial year
ended on March 31, 2026, subject to the approval of shareholders at the ensuing Annual General Meeting. If approved, the
dividend would result in a cash outflow of '' 417.87 lakhs.
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