Jindal Stainless (Hisar) Ltd. இன் கணக்கு குறிப்புகள்
Mar 31, 2022
Nature of Reserves
Capital Reserve Represents the amount on cancellation of share capital in terms of Composite Scheme of Arrangement.
Securities Premium :- Represents the amount received in excess of par value of securities. Premium on redemption of securities is accounted in security premium reserve available. Where security premium reserve is not available, premium on redemption of securities is accounted in statement of profit and loss. Section 52 of Companies Act, 2013 specify restriction and utilisation of security premium reserve.
Other Comprehensive Income Reserve :- Represents the balance in equity for items to be accounted in Other Comprehensive Income. OCI is classified into i). Items that will not be reclassified to profit and loss ii). Items that will be reclassified to profit and loss.
Secured Borrowings
The term loan facility from banks amounting to ''1,158.68 Crore ('' 1,249.76 Crore) are repayable in quarterly installments. ''34.04 Crore during 2022-23 (one Installment of '' 5.54Crore, two installments of ''7.28 Crore each and one installment of ''13.94 Crore), '' 136.97 Crore during 2023-24 (four installments of '' 16.36 Crore, ''36.85 Crore, ''39.55 Crore and ''44.21 Crore), '' 211.44 Crore during 2024-25 (four installments of ''52.86 Crore each), ''298.05 Crore during 2025-26 (one installments of ''72.10 Crore, two installments of ''75.07 crores and one installment of ''75.81 Crore), ''312.76 Crore during 2026-27 (three installments of ''77.00 crores each and one installment of ''81.76 Crore), '' 149.55 Crore during 2027-28 (four installments of ''81.76 Crore, '' 53.01 Crore, ''6.65 Crore and ''8.13 Crore) '' 15.87 Crore during FY 2028-29 (two installments of '' 8.13 crores and ''7.74 Crore ).
The term loan facility from financial institutions amounting to ''46.25 Crore (''Nil) are repayable in quarterly installments. ''5.00 Croreduring 2022-23 (four Installment of ''1.25 Crore each), '' 8.75 Crore during 2023-24 (one installments of ''1.25 Crore, and three installments of ''2.50 Crore each), ''10.00 Crore during 2024-25 (four installments of ''2.50 Crore each), '' 10.00 Crore during 2025-26 (four installments of ''2.50 Crore each), ''8.50 Crore during 2026-27 (one installments of ''2.50 Crore, three installments of ''2.00 crores each), ''4.00 Crore during 2027-28 (two installments of '' 2.00 Crore each).
Theterm loan facility is secured/ to be secured (partial charge in process of execution) by first pari-passu charge by way of mortgage of Company''s immovable properties and hypothecation of moveable fixed assets both present & future and second pari-passu charge by way of hypothecation and/or pledge of current assets including finished goods, raw materials, work-inprogress, consumable stores and spares, book debts, bills receivable, etc both present and future. The stated term loanfacility are further secured/ to be secured by a first ranking pari-passu charge by way of hypothecation or assignment in relation to loans and advances advanced by the Company to JSL. (read with note no. 36)
The above term loans amounting to '' 1,057.19 Crore bear a fioafing rate of interest linked with State bank of India marginal cost of funds based lending rate or benchmark of respective banks plus applicable spread ranging from 10 bps to 210 bps. Balance facility of ''147.74 Crore is linked to repo rate plus spread of 375 bps.
Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is ''88.55 Crore ('' 34.31 Crore).
Exceptional items for the year ended 31 March 2021 includes gain (net) '' 26.32 Crore on translation/settlement of foreign currency monetary items (including borrowing), gain (net) of ''16.06
Crore upon marked to market of derivatives contracts and loss (net) of '' 2.31 Crore on forward cover cancellation.
The term loan facility and working capital facility of the Company are also secured/ to be secured by the following additional securities:
(i) Unconditional & irrevocable personal guarantee of Mr. Ratan Jindal;
(ii) Unconditional & irrevocable corporate guarantee of Jindal Stainless Limited (JSL);
(iii) Pledge of 87.7% of Promoter''s shareholding, as determined on the basis of the filings of the Borrower with the Securities Exchange Board of India (SEBI);
(iv) Pledge of 8,98,68,647 shares of JSL (out of 16,82,84,309 shares) held by the Company in favour of lenders of the Company. Balance 7,84,15,662 no. shares have been pledged in favour of lenders of JSL;
(v) Pledge over investments of the Company in subsidiaries as listed below:
⢠JSL Lifestyle Limited; and
⢠JSL Logistics Limited
(a) On 29 December 2020, the Board of Directors of the Company had approved a Composite Scheme of Arrangement (the ''Scheme'') under Sech''on 230 to 232 (read with Sech''on 66 and other applicable provisions) of Companies Act, 2013 amongst the Company, Jindal Stainless Limited, JSL Lifestyle Limited, Jindal Lifestyle Limited, JSL Media Limited and Jindal Stainless Corporate Management Services Private Limited. The Scheme having appointed date of 01 April 2020 is subject to necessary statutory and regulatory approvals under applicable laws, including approval of the Hon''ble Nah''onal Company Law Tribunal, Chandigarh Bench ("NCLT").
The Company has received the approval of Hon''ble NCLT on its first mofi on applicafion for convening the meefing of the Shareholders and Creditors on 25 February 2022. Further, the Shareholders and Creditors of the Company, in meefing held on 23 April 2022, have approved the Scheme with overwhelming majority. Currently, the Company is in process of filing the second motion application before the Hon''ble NCLT.
(b) The Company has assessed the possible impact of COVID-19 pandemic on its financial results based on the information available up to the date of approval of these financial statements. The Company is closely monitoring the impact of this pandemic and believes this pandemic may not have significant adverse impact on the long term operations and performance of the Company.
(b) Details of Loans given, investment made and guarantees given, covered U/S 186 (4) of the Companies Act ,2013:-
(i) Loans given and investment made are given under respective heads.
(ii) Corporate guarantee given and pledge of shares by the Company on behalf of parties covered u/s 186(4). Refer note no 33 D, 36 and 49.
(a) Research and Development expenses for the year amounting to '' 6.65 Crore ('' 10.25 Crore) on account of revenue expenditure charged/debited to respective heads of accounts.
(b) Certain balances of trade receivable and trade payable are in process of confirmation and/or reconciliation. In the opinion of the management, on confirmation / reconciliation, there will not be any material impact.
(c) The Company has given inter corporate deposits to its two subsidiaries namely Green Delhi BQS Limited & JSL Media Limited, amounting to '' 22.60 Crore ('' 22.60 Crore) {also investment of '' 0.10 Crore ('' 0.10 Crore)} where the subsidiary companies has accumulated losses\negative net worth. In
view of the long term involvement of the Company and future prospects, in the opinion of the management, these are good and realizable hence no provision has been considered necessary.
The Company had challenged the legality of LADT Act / Entry Tax Act in the state of Haryana before the Hon''ble Punjab and Haryana High Court / Supreme Court of India. Subsequently, on the SLP of the Haryana Government, Constitutional Bench of the Hon''ble Supreme vide its judgement dated 11 November 2016 held the applicability of entry tax valid on compensatory ground and directed its Divisional/ Regular Bench for examining the provisions of the state legislation on the issue of discrimination with respect to the parameters of Article 304 (a) of the Constitution and competence of state legislatures to levy entry tax on goods entering the landmass of India from another country. The division bench of Hon''ble Supreme Court vide its order dated 21 March 2017 (declared on 20 May 2017) remanded back the matter and permitted the petitioners to file petition before respective High Court to decide on factual background or any other constitutional/ statutory issues arises for consideration. The company accordingly filed Civil Writ Petition before Hon''ble High Court of Punjab & Haryana on 30 May 2017. The Hon''ble High Court granted interim relief by order for stay of demand on 31 May 2017 till any further direction.
In the meanwhile, the division bench of Hon''ble Supreme Court of India vide its order dated 09 October 2017 has upheld the legislative competence of the State Legislatures to levy Entry Tax on Import of goods from any territory outside India while examining the Entry Tax legislations of the State of Odisha, Kerala and Bihar.
The Company has made necessary provisions in this regard based on own assessment and calculation.
In view of above, Interest/ penalty if any, will be accounted for as and when this is finally determined/ decided by the Hon''ble Court.
Financial risk management42.1 Financial risk factors
The Company''s principal financial liabilities, other than derivafives, comprise borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilifies is to manage finances for the Company''s operafions. The Company has loan, Investment, trade receivables, other receivables, cash and short-term deposits that arise directly from its operafions. The Company also enters into derivative transactions. The Company''s activities expose it to a variety of financial risks:
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprise three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity risk. Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. 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. This is based on the financial assets and financial liabilities held as at 31 March 2022 and 31 March 2021.
Credit risk is the risk that a counter party will not meet its obligations under a financial instrument or customer contract, leading to a financial loss.
Liquidity risk is the risk that the Company may not be able to meet its present and future cash and collateral obligations without incurring unacceptable losses.
The Company''s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company''s financial performance. The Company uses derivative financial instruments to hedge certain risk exposures. The Company does not acquire or issue derivative financial instruments for trading or speculative purposes.
Risk management is carried out by the treasury department under policies approved by the board of directors. The treasury team identifies, evaluates and hedges financial risks in close co-operation with the Company''s operating units. The board provides principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, and credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.
The sensitivity analysis excludes the impact of movements in market variables on the carrying value of post-employment benefit obligations provisions and on the non-flnancial assets and liabilities. The sensitivity of the relevant statement of profit and loss item is the effect of the assumed changes in the respective market risks. The Company''s activities expose it to a variety of financial risks, including the effects of changes in foreign currency exchange rates and interest rates. The Company uses derivative financial instruments such as foreign exchange forward contracts depending upon the underlying
contract and risk management strategy to manage its exposures to foreign exchange fluctuations and interest rate.
Foreign exchange risk and sensitivity
An exposure can be defined as a contracted cash flow (trade receivables, trade payables, loans, purchase order placed or sales order received) denominated in a currency other than Indian Rupees. The Company may have foreign currency exposure on account of the following items:
Exposure against working capital -
i) Export trade receivables and export sales orders received;
ii) Imports trade payables and purchase orders raised;
iii) Packing credit in foreign currency (PCFC),
iv) Borrowings against FCNR(B) deposits of the banks;
v) Advances from customers;
vi) Any other kind of foreign currency borrowings as permitted by RBI for financing working capital of the Company.
viii) Exposure against long term financing/relating to projects:
i. Foreign currency borrowings for capital and project expansion;
ii. Payments due against imported capital equipment for projects;
iii. Purchase orders for capital expenditure;
iv. Any kind of foreign currency borrowing used for long term financing requirements of the Company.
The assumed movement in exchange rate sensih''vity analysis is based on the currently observable market environment.
The Company transacts business primarily in Indian Rupee, USD, EURO, GBP, JPY CHF and CAD. The Company has obtained foreign currency loans and has foreign currency trade payables and receivables and is therefore, exposed to foreign exchange risk. Certain transach''ons of the Company act as natural hedge as a porh''on of both assets and liabilities are denominated in similar foreign currencies. For the remaining exposure to foreign exchange risk, the Company adapts the policy of selech''ve hedging based on risk perceph''on of management. Foreign exchange hedging contracts are carried at fair value.
Interest rate risk and sensitivity
The Company will have Interest rate exposure on all interest bearing financial assets and liabilities. These could be broadly categorized as under:
a) Interest bearing trade receivables and trade payables;
b) Working capital borrowings;
c) Long term borrowings.
All interest bearing assets and liabilities need to be captured, first based on the currency denomination e.g., INR, USD & EURO. Further classification needs to be done based on whether these are against floating rate benchmarks or fixed rate
With all other variables held constant, the following table demonstrates the impact of borrowing cost on floating rate portion of borrowings and borrowings on which interest rate swaps are taken.
The Company is exposed to the movement in price of key raw materials in domestic and international markets. The Company has in place policies to manage exposure to fluctuations in the prices of the key raw materials used in operations. The Company enters into contracts for procurement of material, most of the transactions are short term fixed price contract and a few transactions are long term fixed price contracts.
The Company is not facing any exposure to equity price risk as all of its equity investments are within the group and its associates.
The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions and other financial instruments.
The Company extends credit to customers in normal course of business. The Company considers factors such as credit track record in the market and past dealings for extension of credit to customers. Outstanding trade receivables are regularly monitored. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets. The Company has also taken advances and security deposits from its customers, which mitigate the credit risk to an extent.
In determining the allowances for doubtful trade receivables, the Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for forward looking information. The expected credit loss allowance is based on the ageing of the receivables that are due and rates used in the provision matrix.
Financial instruments and cash deposits
The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which balances and deposits are maintained. The bank balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances other than those required for its day to day operations.
The Company''s objective is to at all times maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company relies on a mix of borrowings, capital infusion and excess operating cash flows to meet its needs for funds. The current committed lines of credit are sufficient to meet its short to medium term expansion needs. The Company monitors rolling forecasts of its liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Company does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities.
The table below provides undiscounted cash flows towards non-derivative financial liabilities and net-settled derivative financial liabilities into relevant maturity based on the remaining period at the balance sheet date to the contractual maturity date.
The Company is required to maintain ratios (including total debt to EBITDA / net worth, EBITDA to gross interest, debt service coverage ratio and secured coverage ratio) as mentioned in the loan agreements at specified levels. In the event of failure to meet any of these ratios these loans become callable at the option of lenders, except where exemption is provided by lender.
42.2 Competition and price risk
The Company faces competition from domestic and international competitors. Nevertheless, it believes that it has competitive edvantage in terms of high quality products and by continuously upgrading its expertise and range of products and trustworthy and innovative solution to meet the needs of its custom ers.
42.3 Capital risk management
The Company m anages its capital structure and makes a djustments in light of changes in economic conditions and the requirements of the onancial «:>penants. To maintain or adjust the capital structure, she Company may adjust the dividend payment to shaoeholders, redeem or b uy back capital to oil areholders or issue new shares. The Companyâs primary objective when managing capital is to ensure that it maintains an efficient capital structure and healthy capital ratios and safeguard the Companyâs abil ity to continue as a goimg concern in ormer to support its bus iness and provide maximum returns for shareholders. Thy Company also proposes to maintain an optimal ca pital structure to reduce the cost of capital.
For the purpose of the Companyis capital management, capital includes issued capital, share premium and other equity. Net debt includes, interest bearing loans and borrowings less cash and cash equivalents excluding discontinued operations.
Fair values of financial assets and liabilities and hierarchy
The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available. The fair values of the financial assets and liabilities are included
at the amount that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.
The following methods and assumptions were used to estimate the fair values:
1. Fair value of cash and deposits, trade receivables, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
2. Long-term fixed-rate and variable-rate receivables / borrowings are evaluated by the Company based on parameters such as interest rates, specific country risk factors, credit risk and other risk characteristics. Fair value of variable interest rate borrowings approximates their carrying values. For fixed interest rate borrowing fair value is determined by using the discounted cash flow (DCF) method using discount rate that reflects the issuer''s borrowings rate. Risk of nonperformance for the Company is considered to be insignificant in valuation.
3. The fair values of derivatives are estimated by using pricing models, where the inputs to those models are based on readily observable market parameters, basis contractual terms, period to maturity, and market parameters such as interest rates, foreign exchange rates, and volatility. These models do not contain a high level of subjectivity as the valuation techniques used do not require significant judgment, and inputs thereto are readily observable from actively quoted market prices. Management has evaluated the credit and non-performance risks associated with its derivative counterparties and believe them to be insignificant and not warranting a credit adjustment.
Fair value hierarchy
The following table provides the fair value measurement hierarchy of Company''s financial asset and
financial liabilities, grouped into Level 1 to Level 3 as described below:
Level 1- Quoted price (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.
Level 2- Inputs other than quoted prices include within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3- Unobservable inputs for the asset or liability.
There were no significant changes in the classification and no significant movements between the fair value hierarchy of assets and liabilities during financial year 2021-22.
Fair valuation of financial guarantees
Financial guarantees issued by the company on behalf of Jindal Stainless Limited have been measured at fair value through profit and loss. Fair value of said guarantees as at 31 March 2022, and 31 March 2021 have been considered at nil as estimated by the management and an independent professional.
The Company adopted Ind AS 116 "Leases" and applied the standard to all lease contracts existing on April 1, 2019 using the modified retrospective method. The Company has leases for office building, warehouses and related facilities.
The following is the movement in lease liabilities and corresponding Right to use asset for leases classified under lease arrangements during the year ended March 31, 2022.
Information related to consolidated financial statements
The Company is listed on stock exchange in India, the Company has prepared consolidated financial statements as required under IND AS 110 Consolidated Financial Statements, Sections 129 of Companies Act, 2013 and listing requirements. The consolidated financial statements is available on Company''s web site for public use.
As per IND AS 108 Operating Segment, segment information has been provided in notes to consolidated financial statements.
Assets are tested for impairment whenever there are any internal or external indicators of impairment. Impairment test is performed at the level of each Cash Generah''ng Unit (''CGU'') within the Company at which the goodwill or other assets are monitored for internal management purposes, within an operah''ng segment.
The impairment assessment is based on higher of value in use and fair value less costs of disposal.
B. Other regulatory informations
i) The Company does not have any benami property, where any proceeding has been initiated or pending against the Company for holding any benami property.
ii) The Company has not traded or invested in crypto currency or virtual Currency during the financial year.
iii) The Company has not 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
iv) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or
(b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries.
v) The Company does 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).
vi) The Company is not declared willful defaulter by and bank or financials institution or lender during the year.
vii) The Company does not have any charges or satisfaction which is yet to be registered with registrar of companies beyond the statutory period.
viii) The company has been sanctioned working capital limit in excess of ''5.00 crore, in aggregate, during the year from banks on the basis of security of current assets. The quarterly returns or statements of current assets filed by the Company with banks are generally in agreement with the unaudited books of accounts of the company.
ix) The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was obtained.
x) The Company does not have any transactions with companies which are stuck off.
56 No adjusting or significant non adjusting events have occurred between the reporting date and date of authorization of financial statements.
57 Previous years'' figures have been re-arranged and regrouped wherever considered necessary. Figures less than Rs. 50000 have been shown as absolute number. Figures in bracket indicate previous year figures.
58 Note 1 to 58 are annexed to and form an integral part of the balance sheet and statement of profit & loss.
Mar 31, 2018
Corporate and general Information
Jindal Stainless (Hisar) Limited (ââthe Companyââ) is domiciled and incorporated in India and its equity shares and GDR are listed at Bombay Stock Exchange/National Stock Exchange/ Luxembourg Stock Exchange respectively. The registered office of the Company is located at O. P. Jindal Marg, District Hisar, 125005, Haryana, India.
The company is a leading manufacturer /producer of stainless steel flat products in austenitic, ferritic, martensitic and duplex grades. The product range includes ferro alloys, stainless steel slabs and blooms, hot rolled coils, plates and sheets, cold rolled coils and sheets and specialty products such as razor blade steel, precision strips and coin blanks.
The financial statements of the Company for the year 31st March 2018 were approved and authorized for issue by board of directors in their meeting held on 26th April 2018.
Statement of compliances
The financial statements are a general purpose financial statement which have been prepared in accordance with the Indian Companies Act, Indian Accounting Standards and complies with other requirements of the law. Indian Accounting Standards (IND AS) include equivalent to International Financial Reporting Standards (IFRS). Compliance with the IND AS ensures that the financial statements and notes of the entity comply with International Financial Reporting Standards (IFRS).
Basis of preparation
These financial statements have been prepared complying in all material respects with the Indian Accounting Standards notified under section 133 of the Companies Act 2013, read with the Companies (Indian Accounting Standards) Rule 2015. The financial statements comply with IND AS notified by Ministry of Company Affairs (MCA). The Company has consistently applied the accounting policies used in the preparation of financial statement of all period presented.
The financial statements has been prepared considering all IND AS as notified and made applicable by MCA for reporting date i.e. 31st March 2018.
The preparation of the financial statements requires management to make estimates and assumptions. Actual results could vary from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized 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 years.
Standards issued but not yet effective
On 28th March 2018, Ministry of Corporate Affairs (MCA) has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018. These amendments will come into force for financial periods beginning on or after 1st April 2018.
IND AS 21, Foreign currency transactions and advance consideration
It clarified that the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, shall be date when an entity has received or paid advance consideration in a foreign currency.
The Company has evaluated the effect of this on the financial statements and the impact is not material.
IND AS 115, revenue from contract with customers
As per revised standard 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.
Additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entityâs contracts with customers, are required to be made.
Transitional provisions provides two options:
i. Under the Retrospective approach, the standard will be applied retrospectively to each prior reporting period presented in accordance with IND AS 8- Accounting Policies, Changes in Accounting Estimates and Errors.
ii. Under the Cumulative catch - up approach, the cumulative effect of initially applying the standard shall be recognized retrospectively at the date of initial application i.e. 1st April 2018.
The Company will adopt the standard on 1st April 2018 by using the cumulative catch-up transition approach and accordingly comparatives for the year ending or ended 31st March, 2018 will not be retrospectively adjusted. The effect on adoption of IND AS 115 is expected to be insignificant.
(b) TERMS/RIGHTS ATTACHED TO EQUITY SHARES
The company has only one class of equity shares having a par value of Rs. 2/- per share. Each shareholder is eligible for one vote per equity share held [other than the shares represented by Regulation S Global Depositary Shares (the âGDSsâ) issued by the Company whose voting rights are subject to certain conditions and procedure as prescribed under the Regulation S Deposit Agreement]. The company declares and pays dividends in Indian rupees. The dividend proposed, if any, by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and also has equal right in distribution of profit/surplus in proportions to the number of equity shares held by the shareholders.
As on 31st March 2018, 7,552,167 GDSs (8,802,167 GDSs) with 15,104,334 underlying equity shares (17,604,334 equity shares) were outstanding. Each GDS represents 2 underlying equity shares of the Company.
Nature of Reserves Capital Reserve:
Represents on cancellation of share capital in terms of Composite Scheme of Arrangement.
Securities Premium Reserve:
Represents the amount received in excess of par value of securities. Premium on redemption of securities is accounted in security premium reserve available. Where security premium reserve is not available, premium on redemption of securities is accounted in statement of profit and loss. Section 52 of Companies Act, 2013 specify restriction and utilisation of security premium reserve.
Other Comprehensive Income Reserve:
Represents the balance in equity for items to be accounted in Other Comprehensive Income. OCI is classified into i). Items that will not be reclassified to profit and loss ii). Items that will be reclassified to profit and loss.
The term loan facility from banks amounting to Rs. 2,356.45 Crore ( Rs. 2,547.64 Crore) are repayable in quarterly instalments of Rs. 48.75 Crore each during 2018-19 (instalment due on 1st April, 2018 has been paid during the month of March 2018 to the extent of Rs. 44.87 Crore) Rs. 58.50 Crore each during 2019-20, Rs. 65.00 Crore each during 2020-21, Rs. 71.50 Crore each from 2021-22 to 2026-27 (the excess amount paid of Rs. 1.08 Crore will be adjusted in last instalment).
The term loan facility is secured by first pari-passu charge by way of mortgage of Company''s immovable properties and hypothecation of moveable fixed assets both present & future and second pari-passu charge by way of hypothecation and/or pledge of current assets including finished goods, raw materials, work-in-progress, consumable stores and spares, book debts, bills receivable, etc both present and future. The stated term loan facility are further secured by a first ranking pari-passu charge by way of hypothecation or assignment in relation to loans and advances advanced by the Company to JSL. (read with Note no. 38)
Rupee term loan facility carried floating rate of interest linked with SBI base rate plus applicable spread of 165 bps. The lenders also have an option to link their effective rate of interest with their own bankâs base rate/ MCLR and adjust the spread accordingly.
Working capital facilities (including Buyerâs Credit facilities) are secured by first pari-passu charge by way of hypothecation and/or pledge of current assets including finished goods, raw material, work in progress, consumable stores and spares, book debts, bill receivable, etc both present and future and by way of second charge in respect of other moveable and immoveable properties, both present and future, of the Company. Working capital facility is repayable on demand. (read with Note no. 38)
1. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs. 73.24 Crores (Rs. 57.72 Crores).
2. (a) Exceptional items includes gain/ (loss) (net) of Rs. 30.13 Crore (Rs. 45.27 Crore) on translation/settlement of foreign currency monetary items (including borrowing), gain / (loss) of (Rs. 2.16 Crore) (Rs. 3.54 Crore) upon marked to market of derivatives contracts (net), gain/(loss) of (Rs. 9.53 Crore) {(Rs.1.56 Crore)} on forward cover cancelation.
(b) Exceptional items includes Rs. Nil (Rs. 10.26 Crore) on account of write off of interest receivable up to 31st March 2016 on loans to two subsidiary companies.
(c) Exceptional items includes Rs. Nil (Rs. 18.98 Crore) on account of provision against FSA charges for earlier periods provided in view of the decision of Honâble Supreme Court.
3. On 30th March, 2016, the Company has issued and allotted 12,50,00,000 number Compulsory Convertible Warrants (CCW) of Rs. 2/each to promoter group entities on preferential basis for the purpose to infuse funds by promoters in terms of sanction letter dated 23rd November 2015 by State Bank of India.
During the previous year against the stated CCW, the Company has allotted 47,49,240 Nos. fully paid up equity shares of Rs. 2/- each @ Rs. 52.64 per share (including premium of Rs. 50.64 per share on 2nd September 2016. The fund had been used for the purpose for which the funds were raised.
4. The term loan facility and working capital facility (including buyersâ credit) of the Company are also be secured by the following additional securities:
(i) Unconditional & irrevocable personal guarantee of Mr. Ratan Jindal;
(ii) Unconditional & irrevocable corporate guarantee of Jindal Stainless Limited (JSL);
(iii) Pledge of 87.7% of Promoterâs shareholding, as determined on the basis of the filings of the Borrower with the Securities Exchange Board of India (SEBI);
(iv) Pledge of 8,98,68,647 shares of JSL (out of 16,82,84,309 shares) held by the Company in favour of lenders of the Company. Balance 7,84,15,662 no. shares have been pledged in favour of Lenders of JSL;
(v) Pledge over investments of the Company in subsidiaries as listed below:
- JSL Lifestyle Limited; and
- JSL Logistics Limited
5. Research and Development expenses for the year amounting to Rs. 7.92 Crore (Rs. 4.21 Crore) on account of revenue expenditure charged/debited to respective heads of accounts and Rs. Nil (Rs. 0.05 Crore) on account of capital expenditure debited to property, plant and equipment.
6. (a) Advances recoverable in cash or in kind or for value to be received includes Interest free loan to employees amounting to Rs. 0.02 Crore (Rs. 0.01 Crore) in the ordinary course of business and as per employee service rules with the Company. Maximum balance outstanding during the year is Rs. 0.02 Crore (Rs. 0.01 Crore).
(b) Pursuant to regulation 34 (3) of Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015, loans and advances in the nature of loans to related parties:
# For the purpose of cash flow support including interest till 31st March 2018.
(c) Details of Loans given, investment made and guarantees given, covered U/S 186 (4) of the Companies Act ,2013: -
(i) Loans given and investment made are given under respective heads.
(ii) Corporate guarantee given by the Company on behalf of parties covered u/s 186(4), details of which is given in related party transactions. Refer note no 34 C (ii), 34 D and note no 38 & 50.
7. (a) Certain balances of trade receivable, loan & advance, trade payable and other liabilities are subject to confirmation and/or reconciliation.
(b) Pursuant to scheme of arrangement, necessary steps and formalities in respect of transfer of and vesting in the properties, licenses, approvals and investments in favor of the company are under implementation.
(c) The Company has given inter corporate deposits to its two subsidiaries namely Green Delhi BQS Limited & JSL Media Limited, amounting to Rs. 22.60 Crore (Rs. 22.60 Crore) {also investment of Rs. 0.10 Crore (Rs. 0.10 Crore)} where the subsidiary companies has accumulated losses\negative net worth. In view of the long term involvement of the Company and future prospects, in the opinion of the management, these are good and realizable hence no provision has been considered necessary.
8. The Company had challenged the legality of LADT Act / Entry Tax Act in the state of Haryana in the Hon''ble Punjab and Haryana High Court / Supreme Court of India. On 16.04.2010 the Entry tax matters of the states have been referred to a larger 9 judges Constitutional Bench of the Supreme Court of India. The 9 judge bench while holding the constitutional validity of entry tax, has, vide its Order dated 11 th November 2016, referred the same to divisional/ regular benches for testing and determination of the Article 304 (a) of the constitution vis a vis state legislation and levy of entry tax on goods entering the landmass of India from another country. The division bench of Hon''ble Supreme Court vide its order dated 21/03/2017 declared on 20/05/2017 permitted the petitioners to file petition before respective High Court in this regard for any factual background or any other constitutional/ statutory issue. The company accordingly filed Civil Writ Petition before Hon''ble High Court of Punjab & Haryana on 30/05/2017, which has granted the stay till further direction.
In the meanwhile, the division bench of Hon''ble Supreme Court of India vide its order dated 09/10/2017 has upheld the legislative competence of the State Legislatures to levy Entry Tax on Import of goods from any Territory outside the India while examining the Entry Tax legislations of the State of Odisha, Kerala and Bihar.
The Company has been making necessary provisions in this regard. Interest/ penalty if any, will be accounted for as and when this is finally settled/ determined.
9. Amount required to be spent towards Corporate Social Responsibility as per the provisions of section 135 of Companies Act, 2013 by the Company during the year is Rs. 2.45 Crore (Rs. 0.21 Crore) and details of amount spent towards Corporate Social Responsibility is as under :
10. Financial risk management
10.1 Financial risk factors
The Companyâs principal financial liabilities, other than derivatives, comprise borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to manage finances for the Companyâs operations. The Company has loan, Investment, trade receivables, other receivables, cash and short-term deposits that arise directly from its operations. The Company also enters into derivative transactions. The Companyâs activities expose it to a variety of financial risks:
(i) Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprise three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity risk. Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. 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. This is based on the financial assets and financial liabilities held as at March 31, 2018 and March 31, 2017.
(ii) Credit risk
Credit risk is the risk that a counter party will not meet its obligations under a financial instrument or customer contract, leading to a financial loss.
(iii) Liquidity risk
Liquidity risk is the risk that the Company may not be able to meet its present and future cash and collateral obligations without incurring unacceptable losses.
The Companyâs overall risk management programme focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Companyâs financial performance. The Company uses derivative financial instruments to hedge certain risk exposures. The Company does not acquire or issue derivative financial instruments for trading or speculative purposes.
Risk management is carried out by the treasury department under policies approved by the board of directors. The treasury team identifies, evaluates and hedges financial risks in close co-operation with the Companyâs operating units. The board provides principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, and credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.
(i) Market risk
The sensitivity analysis excludes the impact of movements in market variables on the carrying value of post-employment benefit obligations provisions and on the non-financial assets and liabilities. The sensitivity of the relevant statement of profit and loss item is the effect of the assumed changes in the respective market risks. The Companyâs activities expose it to a variety of financial risks, including the effects of changes in foreign currency exchange rates and interest rates. The Company uses derivative financial instruments such as foreign exchange forward contracts depending upon the underlying contract and risk management strategy to manage its exposures to foreign exchange fluctuations and interest rate.
Foreign exchange risk and sensitivity
An exposure can be defined as a contracted cash flow (trade receivables, trade payables, loans, purchase order placed or sales order received) denominated in a currency other than Indian Rupees. The Company may have foreign currency exposure on account of the following items:
Exposure against working capital -
i) Export trade receivables and export sales orders received;
ii) Imports trade payables and purchase orders raised;
iii) Buyerâs credit against trade payables;
iv) Packing credit in foreign currency (PCFC),
v) Borrowings against FCNR(B) deposits of the banks;
vi) Advances from customers;
vii) Any other kind of foreign currency borrowings as permitted by RBI for financing working capital of the Company.
viii) Exposure against long term financing/relating to projects:
i. Foreign currency borrowings for capital and project expansion;
ii. Buyerâs credit against capital goods;
iii. Payments due against imported capital equipment for projects;
iv. Purchase orders for capital expenditure;
v. Any kind of foreign currency borrowing used for long term financing requirements of the Company.
Derivatives financial instruments
Derivative contracts entered into by the Company and outstanding as on 31st March, 2018 for hedging currency risks:
The following table demonstrates the sensitivity in the USD, Euro and other currencies to the Indian Rupee with all other variables held constant. The impact on the Companyâs profit before tax and other comprehensive income due to changes in the fair value of monetary assets and liabilities are given below:
The Company transacts business primarily in Indian Rupee, USD, EURO and CAD. The Company has obtained foreign currency loans and has foreign currency trade payables and receivables and is therefore, exposed to foreign exchange risk. Certain transactions of the Company act as natural hedge as a portion of both assets and liabilities are denominated in similar foreign currencies. For the remaining exposure to foreign exchange risk, the Company adapts the policy of selective hedging based on risk perception of management. Foreign exchange hedging contracts are carried at fair value.
Interest rate risk and sensitivity
The Company will have Interest rate exposure on all interest bearing financial assets and liabilities. These could be broadly categorized as under:
a) Interest bearing trade receivables and trade payables;
b) Working capital borrowings;
c) Long term borrowings.
All interest bearing assets and liabilities need to be captured, first based on the currency denomination e.g., INR, USD. Further classification needs to be done based on whether these are against floating rate benchmarks or fixed rate
With all other variables held constant, the following table demonstrates the impact of borrowing cost on floating rate portion of borrowings and borrowings on which interest rate swaps are taken.
The assumed movement in basis points for interest rate sensitivity analysis is based on the currently observable market environment.
Price risk and sensitivity
The Company is exposed to the movement in price of key raw materials in domestic and international markets. The Company has in place policies to manage exposure to fluctuations in the prices of the key raw materials used in operations. The Company enters into contracts for procurement of material, most of the transactions are short term fixed price contract and a few transactions are long term fixed price contracts.
The Company is not facing any exposure to equity price risk as all of its equity investments are within the group and its associates.
ii) Credit risk
The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions and other financial instruments.
Trade receivables
The Company extends credit to customers in normal course of business. The Company considers factors such as credit track record in the market and past dealings for extension of credit to customers. Outstanding trade receivables are regularly monitored. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets. The Company has also taken advances and security deposits from its customers, which mitigate the credit risk to an extent.
In determining the allowances for doubtful trade receivables, the Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for forward looking information. The expected credit loss allowance is based on the ageing of the receivables that are due and rates used in the provision matrix.
Financial instruments and cash deposits
The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which balances and deposits are maintained. The bank balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances other than those required for its day to day operations
iii) Liquidity risk
The Companyâs objective is to at all times maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company relies on a mix of borrowings, capital infusion and excess operating cash flows to meet its needs for funds. The current committed lines of credit are sufficient to meet its short to medium term expansion needs. The Company monitors rolling forecasts of its liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Company does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities.
The table below provides undiscounted cash flows towards non-derivative financial liabilities and net-settled derivative financial liabilities into relevant maturity based on the remaining period at the balance sheet date to the contractual maturity date.
The Company is required to maintain ratios (including total debt to EBITDA / net worth, EBITDA to gross interest, debt service coverage ratio and secured coverage ratio) as mentioned in the loan agreements at specified levels. In the event of failure to meet any of these ratios these loans become callable at the option of lenders, except where exemption is provided by lender.
Interest rate and currency of borrowings
The below details do not necessarily represent foreign currency or interest rate exposure to the income statement, since the Company has taken derivatives for offsetting the foreign currency and interest rate exposure.
10.2 Competition and price risk
The Company faces competition from domestic and international competitors. Nevertheless, it believes that it has competitive advantage in terms of high quality products and by continuously upgrading its expertise and range of products and trustworthy and innovative solution to meet the needs of its customers.
10.3 Capital risk management
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, redeem or buy back capital to shareholders or issue new shares. The Companyâs primary objective when managing capital is to ensure that it maintains an efficient capital structure and healthy capital ratios and safeguard the Companyâs ability to continue as a going concern in order to support its business and provide maximum returns for shareholders. The Company also proposes to maintain an optimal capital structure to reduce the cost of capital.
For the purpose of the Companyâs capital management, capital includes issued capital, compulsorily convertible debentures, share premium and all other equity reserves. Net debt includes, interest bearing loans and borrowings, trade and other payables less cash and short term deposits, excluding discontinued operations.
11. Fair values of financial assets and liabilities and hierarchy
The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available. The fair values of the financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
The following methods and assumptions were used to estimate the fair values:
1. Fair value of cash and deposits, trade receivables, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
2. Long-term fixed-rate and variable-rate receivables / borrowings are evaluated by the Company based on parameters such as interest rates, specific country risk factors, credit risk and other risk characteristics. Fair value of variable interest rate borrowings approximates their carrying values. For fixed interest rate borrowing fair value is determined by using the discounted cash flow (DCF) method using discount rate that reflects the issuerâs borrowings rate. Risk of non-performance for the Company is considered to be insignificant in valuation.
3. The fair values of derivatives are estimated by using pricing models, where the inputs to those models are based on readily observable market parameters, basis contractual terms, period to maturity, and market parameters such as interest rates, foreign exchange rates, and volatility. These models do not contain a high level of subjectivity as the valuation techniques used do not require significant judgment, and inputs thereto are readily observable from actively quoted market prices. Management has evaluated the credit and non-performance risks associated with its derivative counterparties and believe them to be insignificant and not warranting a credit adjustment.
Fair value hierarchy
The following table provides the fair value measurement hierarchy of Companyâs financial asset and financial liabilities, grouped into Level 1 to Level 3 as described below:
Level 1- Quoted price (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.
Level 2- Inputs other than quoted prices include within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3- Unobservable inputs for the asset or liability.
There were no significant changes in the classification and no significant movements between the fair value hierarchy of assets and liabilities during FY 2017-18.
Fair valuation of financial guarantees
Financial guarantees issued by the company on behalf of Jindal Stainless Limited have been measured at fair value through profit and loss. Fair value of said guarantees as at March 31, 2018, and March 31, 2017 have been considered at nil as estimated by the management and an independent professional.
12. Operating lease
The Company has taken land and building under operating lease arrangement which is non-cancellable for a fixed period of 29 years. The lease rental expense is subject to escalation whereby the lessor is entitled to increase the lease rental by 5% after every three years.
The Company has taken another land and building under operating lease arrangement for a fixed period of 12 years. The lease rental expense is subject to escalation whereby the lessor is entitled to increase the lease rental by 5% every year and are usually renewable by mutual agreeable terms.
13. Information related to consolidated financials
The Company is listed on stock exchange in India, the Company has prepared consolidated financial statement as required under IND AS 110, Sections 129 of Companies Act, 2013 and listing requirements. The consolidated financial statement is available on Companyâs web site for public use.
14 Segment reporting
As per IND AS 108 Operating Segment, segment information has been provided in notes to consolidated financial statements.
Note Above to be read with note no. 34 (C) (ii) & 34 (D) and transactions with Jindal Stainless Limited are subject to the approval of the shareholders in the ensuing General Meeting.
* written off
** Includes loan of Rs. 12.26 Crore (Rs. 12.26 Crore)
@Includes Inter corporate Deposits amounting to Rs. 900.00 Crore (Rs. 485.00 Crore) including interest till 31st March 2018, which is repayable in one or more instalment by 31st March, 2023, or such other terms as may be mutually agreed between the company and Jindal Stainless Limited and interest thereon is payable on monthly basis from 1st April, 2018 onwards.
*As the future liability for gratuity & leave encashment is provided on an actuarial basis for the company as a whole, the amount pertaining to individual is not ascertainable and therefore not included above.
15. Assets are tested for impairment whenever there are any internal or external indicators of impairment. Impairment test is performed at the level of each Cash Generating Unit (âCGUâ) within the Company at which the goodwill or other assets are monitored for internal management purposes, within an operating segment.
The impairment assessment is based on higher of value in use and fair value less costs of disposal.
During the year, the testing did not result in any impairment in the carrying amount of goodwill and other assets.
The measurement of the cash generating unitsâ value in use is determined based on financial plans that have been used by management for internal purposes. The planning horizon reflects the assumptions for short to- mid term market conditions.
16. Capital work-in-progress (CWIP) includes technical know-how and supervision fees, taxes, machinery under installation/in transit, preoperative expenses and other assets under erection. Details of same are as under: -
17. Previous years'' figures have been re-arranged and regrouped wherever considered necessary. Figures less than 50000 have been shown as absolute number. Figures in bracket indicate previous year figures.
18. Note 1 to 58 are annexed to and form an integral part of the balance sheet and statement of profit & loss.
Mar 31, 2017
(b) TERMS/RIGHTS ATTACHED TO EQUITY SHARES
The company has only one class of equity shares having a par value of X 21- per share. Each shareholder is eligible for one vote per equity share held [other than the shares represented by Regulation S Global Depositary Shares (the âGDSsâ) issued by the Company whose voting rights are subject to certain conditions and procedure as prescribed under the Regulation S Deposit Agreement], The company declares and pays dividends in Indian rupees. The dividend proposed, if any, by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and also has equal right in distribution of Profit/Surplus in proportions to the number of equity shares held by the shareholders.
As on 31st March 2017, 8,802,167 GDSs (8,802,167 GDSs) with 17,604,334 underlying equity shares (17,604,334 equity shares) were outstanding. Each GDS represents 2 underlying equity shares of the Company.
# Conversion of CCWs in equity Shares (Refer Note No. 37)
Nature of Reserves
Capital Reserve:- Represents on cancellation of share capital in terms of Composite Scheme of Arrangement
Securities Premium Reserve :- Represents the amount received in excess of par value of securities (Including amount recognized pursuant to Composite Scheme of Arrangement and Conversion of CCW refer Note No . 37). Premium on redemption of securities is accounted in security premium reserve available. Where security premium reserve is not available, premium on redemption of securities is accounted in statement of profit and loss. Section 52 of Companies Act, 2013 specify restriction and utilization of security premium reserve.
Other Comprehensive Income Reserve :- Represents the balance in equity for items to be accounted in Other Comprehensive Income. OCI is classified into i). Items that will not be reclassified to prof t and loss ii). Items that will be reclassified to profit and loss.
Secured Borrowings
(a) The Company has executed a Rupee Term Loan Agreement (âRTLAâ) dated March 23, 2016 of Rs, 2600.00 Crore (âTerm Loan Facilityâ) with a consortium of lenders. During the financial year, the Term Loan Facility was fully disbursed. The said Term Loan Facility from banks amounting to Rs, 2547.64 Crore (Rs, 1183.54 Crore) are repayable in quarterly installments of Rs, 47.45 Crore each during 2017-18 (installment due on 1st April 2017 has been paid during the month of March 2017 to the extent of Rs, 43.67 Crore), Rs, 48.75 Crore each during 2018-19, Rs, 58.50 Crore each during 2019-20, Rs, 65.00 Crore each during 2020-21 and thereafter Rs, 71.50 Crore each from 2021-22 to 2026-27 (the excess amount paid of Rs, 0.46 Crore will be adjusted in last installment).
The Term Loan Facility is secured (charge created/to be created) by first pari-passu charge by way of mortgage of Company''s immovable properties and hypothecation of moveable fixed assets both present & future and second pari-passu charge by way of hypothecation and/or pledge of current assets including finished goods, raw materials, work-in-progress, consumable stores and spares, book debts, bills receivable, etc both present and future. (Also read with Note no. 38).
Rupee term loan facility carries floating rate of interest linked with SBI base rate plus applicable spread of 165 bps. The lenders also have an option to link their effective rate of interest with their own banks Base Rate and adjust the spread accordingly.
Secured Borrowings
* âWorking Capital Facilities of Jindal Stainless Limited ceased w.e.f. 22.02.2017 to have security on the assets transferred in pursuant to Composite Scheme of Arrangement (Read with note no 34).
* includes the amount ofRs, Nil (Rs, 70.63 Crore) ((Rs, 481.88 Crore)) of working capital facilities and Rs, Nil (Rs, 232.35 Crore) ((Rs, 371.84 Crore)) of buyer credit has been allocated by Jindal Stainless Limited pursuant to Composite Scheme of Arrangement (read with note no 34) pending confirmation from the respective banks.
(a) Working Capital Facilities are secured (charge created/to be created) by first pari-passu charge by way of hypothecation and/or pledge of current assets including finished goods, raw material, work in progress, consumable stores and spares, book debts, bill receivable, etc both present and future and by way of second charge in respect of other moveable and immoveable properties, both present and future, of the Company. Working Capital Facility is repayable on demand. (Also read with Note no. 38)
(b) Buyer Credit Facility are secured (charge created/to be created) by first pari-passu charge by way of hypothecation and/or pledge of current assets including finished goods, raw material, work in progress, consumable stores and spares, book debts, bill receivable, etc both present and future and by way of second charge in respect of other moveable and immoveable properties, both present and future, of the Company. (Also read with Note no. 38)
(Read with note no 34)
1. Composite Scheme of Arrangement
A Composite Scheme of Arrangement (here in after referred to as ''Scheme'') amongst Jindal Stainless Limited (JSL) and its three wholly owned subsidiaries namely Jindal Stainless (Hisar) Limited (the Company/Transferee/Resulting Company), Jindal United Steel Limited (JUSL) and Jindal Coke Limited (JCL) under the provision of Sec 391-394 read with 100-103 of the Companies Act, 1956 and other relevant provision of Companies Act, 1956 and I or Companies Act, 2013 has been sanctioned by the Hon''ble High Court of Punjab & Haryana, Chandigarh vide its Order dated 21st September 2015, modified by order dated 12th October, 2015.
Pursuant to the Section I and Section II of the Scheme becoming effective on 1st November, 2015 w.e.f. appointed date i.e. close of business hours before midnight of March 31, 2014:
(a) During the year, against amount ofRs, 366.19 Crore appearing as on 31st March, 2016 under head ''Equity Shares Pending Allotment. JSL has allotted 16,82,84,309 no. of fully paid up equity shares of X 21- each @ Rs, 21.76 per share (including premium of Rs, 19.76 per share) on 3rd July 2016.
(b) During the year, Rs, 2600 Crore payable to JSL has been fully paid off.
(c) In terms of the Scheme, all the business and activities of Demerged Undertakings and Business Undertaking 1 (as referred in the Scheme) carried on by JSL on and after the appointed date, as stated above till 1st November ,2015, are deemed to have been carried on behalf of the Company.
(d) The necessary steps and formalities in respect of transfer of and vesting in the properties, licenses, approvals and investments in favor of the Company and modification of charges etc. are under implementation.
(e) While according its approval for transfer/right to use of the land, Government of Odisha, Department of steel & mines vide letter dated 16th August 2016, had put a condition that Section I & II of the Scheme will not be carried out in so for as the mining lease of the Company is concerned; accordingly transfer to the Mining Rights to Demerged Undertaking (as referred in the Scheme) (Demerged undertaking transferred to Company) is not been given effect, consequently:- (i) all mining activities in relation to the Mining Rights continue to be carried out by the JSL; and (ii) all assets (excluding fixed assets) and liabilities (including contingent liabilities) in relation to the Mining Rights continue to be recorded in the books of JSL; and (iii) all revenue and net profit; post 1st November 2015 on section I & II of the scheme becoming effective are recorded in the books of JSL.
2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs, 57.72 Crore (as on
31.03.2016 Rs, 40.62 Crore) (as on 01.04.2015 Rs,23.91 Crore).
3. (a) Exceptional items includes Gain I (Loss) (net) of Rs, 45.27 Crore {Rs,(36.63 Crore)} on translation/settlement of foreign currency monetary items
(including borrowing), gain I (loss) of Rs, 3.54 Crore {(Rs,3.17 Crore)} upon marked to market of derivatives contracts, gain/(loss) of Rs, (1.56 Crore) {Gain Rs,13.24 Crore} on forward cover cancelation.
(b) Exceptional items includes amount written offI provided for of Rs, Nil (Rs, 18.40 Crore) (including provision of Rs, 0.33 Crore) being non recoverable from certain parties.
(c) Exceptional items includes Rs, 10.26 Crore (Rs, Nil) on account of written off of interest receivable up to 31st March 2016 on loans to two Subsidiary companies.
(d) Exceptional items includes Rs, 18.98 Crore (Rs, Nil) on account of provision against FSA charges for earlier periods provided in view of the decision of Hon''ble Supreme Court.
4. On 30th March, 2016, the Company has issued and allotted 12,50,00,000 number Compulsory Convertible Warrants (CCW) of Rs, 21- each to promoter group entities on preferential basis for the purpose to infuse funds by promoters in terms of sanction letter dated 23rd November, 2015 by State Bank of India.
During the year against the stated CCW, the Company has allotted 47,49,240 Nos. fully paid up equity shares of Rs, 21- each @ Rs, 52.64 per share (including premium of Rs, 50.64 per share) on 2nd September, 2016. The amount raised has been used for the purpose for which the funds were raised.
5. The Term Loan Facility and Working Capital Facility (including Buyers'' Credit) of the Company are/will also be secured by the following additional securities:
(i) Unconditional & irrevocable personal guarantee of Mr. Ratan Jindal;
(ii) Unconditional & irrevocable corporate guarantee of Jindal Stainless limited (JSL);
(iii) Pledge of 87.7% of Promoter''s shareholding, as determined on the basis of the filings of the Borrower with the Securities Exchange Board of India (SEBI);
(iv) Pledge of 2, 06, 98,970 shares of JSL (out of 16, 82, 84,309 shares) held by the Company in favour of lenders of the Company. For balance 14,75,85,339 shares, a Non-Disposal Undertaking (NDU) has been given in favour of lenders of JSL, pending full implementation of asset monetization plan approved by the empowered group of corporate debt restructuring lenders of JSL vide their letter dated December 26,
2014.
(v) Pledge over investments of the Company in subsidiaries as listed below:
- JSL Lifestyle Limited; and
- JSL Logistics Limited
(vi) Certain conditions, modification and creation of security of the Term Loan Facility and Working Capital Facility (including Buyers'' Credit) are in process of compliance/ confirmation.
6. Research and Development expenses for the year amounting to Rs, 4.21 Crore (Rs, 1.54 Crore) on account of revenue expenditure charged/debited to respective heads of accounts and Rs, 0.05 Crore (Rs, Nil) on account of Capital expenditure debited to Property, Plant and Equipment.
7. (a) Advance recoverable in cash or in kind or for value to be received includes Interest free loan to employees amounting to Rs, 0.01 Crore (as
on 31.03.2016 Rs, 0.0053 Crore)(as on 01.04.2015 Rs,0.15 Crore) in the ordinary course of business and as per employee service rules of the Company. Maximum balance outstanding during the year isRs, 0.01 Crore (as on 31.03.2016 Rs,0.26 Crore).
(b) Pursuant to regulation 34 (3) of Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations,
2015, Loans and Advances in the nature of Loans to Related parties:
# For the purpose of Cash Flow Support.
(c) Details of Loans given , investment made and guarantees given, covered U/S 186 (4) of the Companies Act, 2013:-
(i) Loans given and investment made are given under respective heads.
(ii) Corporate guarantee given by the Company on behalf of parties covered u/s 186(4), details of which is given in related party transaction refer note no 34 A(b),D and Note no 38 & 51.
8. (a) Certain balances of trade receivable, loan & advance, trade payable and other liabilities are subject to confirmation and/or reconciliation.
(b) The Company has given inter corporate deposit to its two subsidiary companies namely Green Delhi BQS Limited & JSL Media Limited, amounting to Rs,22.60 Crore (as on 31.03.2016 Rs, 32.86 Crore) (as on 01.04.2015 Rs, 44.99 Crore) (also investment of Rs,0.10 Crore (as on 31.03.2016 Rs, 0.10 Crore) (as on 01.04.2015 Rs, 0.10 Crore) where the subsidiary companies has accumulated losses\negative net worth. In view of the long term involvement of the Company and future prospects, in the opinion of the management, these are good and realizable hence no provision has been considered necessary.
9. The Company had challenged the legality of LADT Act I Entry Tax Act in the state of Haryana in the Hon''ble Punjab and Haryana High Court I Supreme Court of India. On 16.04.2010, the Entry tax matters of the states had been referred to larger 9-judges Constitutional Bench of the Supreme Court of India. The 9 judges bench while holding the constitutional validity of entry tax, has, vide its Order dated 11th November 2016, referred the same to divisional/ regular benches for testing and determination of the Article 304 (a) of the Constitution vis a vis state legislation and levy of entry tax on goods entering the landmass of India from another country.
The Company has been making necessary provisions in this regard. Interest/ penalty if any, will be accounted for as and when this is finally settled/ determined by the Regular Benches hearing the matters, Where the appropriate proceedings are continuing.
10. Finance Lease
Assets acquired under leases where the Company has substantially all the risks and rewards of ownership are classified as finance lease. Such assets are capitalized at inception of the lease at the lower of the fair value or present value if minimum lease payments and a liability is created for an equivalent amount.
Lease interest charged to profit & loss for right to use of CTL Machine (Cut to length) for the services regarding cutting of Stainless Steel sheets.
11. Amount spent towards Corporate Social Responsibility as per the provisions of section 135 of Companies Act, 2013 for the year amounting to Rs, 0.67 Crore (Rs, Nil).
12. Financial Risk Management
13. Financial Risk Factors
The Company''s principal financial liabilities, other than derivatives, comprise borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to manage finances for the Company''s operations. The Company has loan, Investment, trade receivables, other receivables, cash and short-term deposits that arise directly from its operations. The Company also enters into derivative transactions. The Company''s activities expose it to a variety of financial risks:
(i) Market Risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprise three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity risk. Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. 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. This is based on the financial assets and financial liabilities held as at March 31, 2017 and March 31, 2016 and April 1,2015.
(ii) Credit Risk
Credit risk is the risk that a counter party will not meet its obligations under a financial instrument or customer contract, leading to a financial loss.
(iii) Liquidity Risk
Liquidity risk is the risk that the Company may not be able to meet its present and future cash and collateral obligations without incurring unacceptable losses.
The Company''s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company''s financial performance. The Company uses derivative financial instruments to hedge certain risk exposures. The Company does not acquire or issue derivative financial instruments for trading or speculative purposes.
Risk management is carried out by the treasury department under policies approved by the board of directors. The treasury team identifies, evaluates and hedges financial risks in close co-operation with the Company''s operating units. The board provides principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, and credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.
(i) Market Risk
The sensitivity analysis excludes the impact of movements in market variables on the carrying value of post-employment benefit obligations provisions and on the non-financial assets and liabilities. The sensitivity of the relevant Statement of Profit and Loss item is the effect of the assumed changes in the respective market risks. The Company''s activities expose it to a variety of financial risks, including the effects of changes in foreign currency exchange rates and interest rates. The Company uses derivative financial instruments such as foreign exchange forward contracts depending upon the underlying contract and risk management strategy to manage its exposures to foreign exchange fluctuations and interest rate.
Foreign Exchange Risk and Sensitivity
An Exposure can be defined as a Contracted Cash Flow (Trade Receivable, Trade Payable, loan, purchase order placed or sales order received) denominated in a currency other than Indian Rupees. The Company may have foreign currency exposure on account of the following items:
Exposure against Working capital -
(i) Export Trade Receivables and export sales orders received;
(ii) Imports Trade Payables and purchase orders raised;
(iii) Buyer''s credit against trade payables;
(iv) Packing credit in foreign currency (PCFC),
(v) Borrowings against FCNR(B) deposits of the banks;
(vi) Advances from customers;
(vii) Any other kind of foreign currency borrowings as permitted by RBI for financing working capital of the Company.
(viii) Exposure against long term financing/relating to projects:
(i) Foreign Currency Borrowings for capital and project expansion;
(ii) Buyer''s credit against capital goods;
(iii) Payments due against imported capital equipment for projects;
(iv) Purchase orders for capital expenditure;
(v) Any kind of foreign currency borrowing used for long term financing requirements of the Company.
Derivatives Financial Instruments
Derivative contracts entered into by the Company and outstanding as on 31st March, 2017 for hedging currency risks:
Note: INR equivalent values have been calculated at the year end exchange rates in INR to give an indicative value of the contracts in rupees. Actual hedges however may be in different currency denominations.
Foreign Currency exposures that are not hedged by derivative instruments or otherwise outstanding as on 31st March, 2017 is as under:
The following table demonstrates the sensitivity in the USD, Euro and other currencies to the Indian Rupee with all other variables held constant. The impact on the Company''s profit before tax and other comprehensive income due to Changes in the fair value of monetary assets and liabilities are given below:
The assumed movement in exchange rate sensitivity analysis is based on the currently observable market environment.
The Company transacts business primarily in Indian Rupee, USD, EURO and CAD. The Company has obtained foreign currency loans and has foreign currency trade payables and receivables and is therefore, exposed to foreign exchange risk. Certain transactions of the Company act as natural hedge as a portion of both assets and liabilities are denominated in similar foreign currencies. For the remaining exposure to foreign exchange risk, the Company adapts the policy of selective hedging based on risk perception of management. Foreign exchange hedging contracts are carried at fair value.
Interest Rate Risk and Sensitivity
The Company will have Interest rate exposure on all interest bearing financial assets and liabilities. These could be broadly categorized as under:
(a) Interest bearing Trade Receivables and Trade Payables;
(b) Working capital borrowings;
(c) Long term borrowings.
All interest bearing assets and liabilities need to be captured, first based on the currency denomination e.g., INR, USD. Further classification needs to be done based on whether these are against floating rate benchmarks or fixed rate
The assumed movement in basis points for interest rate sensitivity analysis is based on the currently observable market environment.
Price Risk and Sensitivity
The Company is exposed to the movement in price of key raw materials in domestic and international markets. The Company has in place policies to manage exposure to fluctuations in the prices of the key raw materials used in operations. The Company enters into contracts for procurement of material, most of the transactions are short term fixed price contract and a few transactions are long term fixed price contracts.
The Company is not facing any exposure to equity price risk as all of its equity investments are within the group and its associates.
(ii) Credit Risk
The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions and other financial instruments.
Trade Receivables
The Company extends credit to customers in normal course of business. The Company considers factors such as credit track record in the market and past dealings for extension of credit to customers. Outstanding Trade receivables are regularly monitored. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets. The Company has also taken advances and security deposits from its customers, which mitigate the credit risk to an extent.
In determining the allowances for doubtful trade receivables, the Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for forward looking information. The expected credit loss allowance is based on the ageing of the receivables that are due and rates used in the provision matrix.
Financial Instruments and Cash Deposits
The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which balances and deposits are maintained. The bank balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances other than those required for its day to day operations.
(iii) Liquidity Risk
The Company''s objective is to at all times maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company relies on a mix of borrowings, capital infusion and excess operating cash flows to meet its needs for funds. The current committed lines of credit are sufficient to meet its short to medium term expansion needs. The Company monitors rolling forecasts of its liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Company does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. The table below provides undiscounted cash flows towards non-derivative financial liabilities and net-settled derivative financial liabilities into relevant maturity based on the remaining period at the balance sheet date to the contractual maturity date.
The Company is required to maintain ratios (including total debt to EBITDA I net worth, EBITDA to gross interest, debt service coverage ratio and secured coverage ratio) as mentioned in the loan agreements at specified levels. In the event of failure to meet any of these ratios these loans become callable at the option of lenders, except where exemption is provided by lender.
14. Competition and Price Risk
The Company faces competition from domestic and international competitors. Nevertheless, it believes that it has competitive advantage in terms of high quality products and by continuously upgrading its expertise and range of products and Trustworthy and innovative solution to meet the needs of its customers.
15. Capital Risk Management
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, redeem or buy back capital to shareholders or issue new shares. The Company''s primary objective when managing capital is to ensure that it maintains an efficient capital structure and healthy capital ratios and safeguard the Company''s ability to continue as a going concern in order to support its business and provide maximum returns for shareholders. The Company also proposes to maintain an optimal capital structure to reduce the cost of capital.
For the purpose of the Company''s capital management, capital includes issued capital, compulsorily convertible debentures, share premium and all other equity reserves. Net debt includes, interest bearing loans and borrowings, trade and other payables less cash and short term deposits, excluding discontinued operations.
The Company monitors capital using gearing ratio, which is net debt divided by total capital.
16. Fair values of Financial Assets and Liabilities and Hierarchy
The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available.
The fair values of the financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the measurement date.
The following methods and assumptions were used to estimate the fair values:
(1) Fair value of cash and deposits, trade receivables, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
(2) Long-term fixed-rate and variable-rate receivables I borrowings are evaluated by the Company based on parameters such as interest rates, specific country risk factors, credit risk and other risk characteristics. Fair value of variable interest rate borrowings approximates their carrying values. For fixed interest rate borrowing fair value is determined by using the discounted cash flow (DCF) method using discount rate that reflects the issuer''s borrowings rate. Risk of non-performance for the Company is considered to be insignificant in valuation.
(3) The fair values of derivatives are estimated by using pricing models, where the inputs to those models are based on readily observable market parameters, basis contractual terms, period to maturity, and market parameters such as interest rates, foreign exchange rates, and volatility. These models do not contain a high level of subjectivity as the valuation techniques used do not require significant judgment, and inputs thereto are readily observable from actively quoted market prices. Management has evaluated the credit and non-performance risks associated with its derivative counterparties and believe them to be insignificant and not warranting a credit adjustment.
Fair Value Hierarchy
The following table provides the fair value measurement hierarchy of Company''s financial asset and financial liabilities, grouped into Level 1 to
Level 3 as described below:
Level 1- Quoted price (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.
Level 2- Inputs other than quoted prices include within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3- Unobservable inputs for the asset or liability.
There were no significant changes in the classification and no significant movements between the fair value hierarchy of assets and liabilities during FY 2016-17.
Fair Valuation of Financial Guarantees
Financial guarantees issued by the company on behalf of Jindal Stainless Limited have been measured at fair value through profit and loss account. Fair value of said guarantees as at March 31, 2017, March 31, 2016 have been considered at nil as estimated by the management and an independent professional.
17. Standards issued but not yet effective
In March 2017, the Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards) (Amendments) Rules, 2017, notifying amendments to Ind AS 7, ''Statement of cash flows''. These amendments are in accordance with the recent amendments made by International Accounting Standards Board (IASB) to IAS 7, ''Statement of cash flows''. The amendments are applicable to the Company from April 1, 2017.
The amendment to Ind AS 7 requires the entities to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes, suggesting inclusion of a reconciliation between the opening and closing balances in the balance sheet for liabilities arising from financing activities, to meet the disclosure requirement.
The company is evaluating the requirements of the amendment and the effect on the financial statements is being evaluated.
18. Information related to consolidated financials
The Company is listed on stock exchange in India, the Company has prepared consolidated financial as required under IND AS 110, Sections 129 of Companies Act, 2013 and listing requirements. The consolidated financial statement is available on Company''s web site for public use.
(d) Trust:
1. Jindal Stainless (Hisar) Limited Group Gratuity Fund
2. Jindal Stainless (Hisar) Limited (Ferro alloys) Group Gratuity Scheme
3. Jindal Stainless (Hisar) Limited EPF Trust
4. Jindal Stainless (Hisar) Welfare Fund
(e) Key Management Personnel with whom transactions have taken place during the year and previous year:
1. Mr. Ratan Jindal Chairman
2. Mr. Ashok Kumar Gupta (w.e.f. 2.11.2015) Whole Time Director and Manager
3. Mr. Jagmohan Sood (w.e.f. 1.04.2016) COO & Unit Head, Hisar Plant
4. Mr. AnkurAgrawal (w.e.f. 2.11.2015) Chief Financial Officer
5. Mr. Bhartendu Harit (w.e.f. 3.11.2015) Company Secretary
19.FIRST-TIME ADOPTION OF IND AS
Exemption availed and exceptions applied
The Company prepared financial statements for all periods up to 31st March 2016 in accordance with The Accounting Standards notified u/s 133 of The Companies Act 2013 (as amended) (read with Companies (Accounts) Rules 2014 ("Indian GAAP").
These are the Company''s first annual financial statements prepared complying in all material respects with the Indian Accounting Standards (Ind AS) prescribed under the section 133 of the Companies Act, 2013 read with rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and the Companies (Accounting Standards) Amendment Rules, 2016. Accordingly the Company prepared its opening Ind AS Balance Sheet at April 1, 2015 and comparative period presented for the financial year 2015-16.
(i) Exemptions availed
As permitted by Ind AS 101 (First-time Adoption of Ind AS) the Company has availed following exemptions from the retrospective application of certain requirements under Ind AS. These exemptions are:
- The Company has chosen to measure all items of Property, Plant and Equipment and Intangible assets on transition date i.e. 1st April 2015 at carrying cost under Indian GAAP as their deemed cost.
- The Company has chosen to continue Indian GAAP carrying amount of its investments in subsidiary, associate and joint ventures as their deemed cost.
- The Company has opted to apply business combination Ind AS 103 (Business Combinations) post transition date and not retrospectively.
(i) Exceptions applied
- The estimates as at 1st April 2015 and 31st March 2016 are consistent with estimates made for the same date in accordance with Indian GAAP.
- The Company has classified the financial assets in accordance with Ind AS 109 (Financial Instruments) on the basis of facts and conditions which existed on Ind AS transition date.
- The Company has elected to apply the Derecognition requirements for financial assets and financial liabilities in accordance with Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS.
1. Transition to Ind AS - Reconciliations
The following reconciliations provide a quantification of the effect of significant differences arising from the transition from Indian GAAP to Ind AS in accordance with Ind AS 101 on the Company equity, balance sheet & statement of profit & loss for the financial period previously reported under Indian GAAP
âRepresents Compulsory Convertible Warrants and Reserve and surplus excluding share capital.
The following explains the material adjustments made while transition from Indian GAAP to Ind AS.
(a) As required under Ind AS 109, transactions costs incurred towards origination of borrowings are to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognized in the statement of profit or loss over the tenure of the borrowing as part of the interest expense by applying the effective interest rate method. Accordingly the same were adjusted in Long term borrowings. Under Indian GAAP, these transaction costs were charged to statement of profit and loss as and when incurred.
(b) As required under Ind AS 38, goodwill is not amortized and is assessed for Impairment. Accordingly there is reversal of amortization of goodwill in Indian GAAP and resulted to increase in goodwill value and equity as at 31st March, 2016.
(c) As per Ind AS, to the extent the service providers have inventory, they measure them at their costs of production. These costs primarily consist of Labour & other costs of directly engaged in providing the service including supervisory personnel and attributable overheads. Accordingly the Company has to account for its inventory with the job service providers called âUnbilled revenueâ
(d) Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. Accordingly excise duty is presented on the face of statement of profit & loss as part of expenses.
(e) Under Ind AS, revenue from sale of goods is presented net of Trade discount. Accordingly Trade discount is netted with revenue in the statement of profit & loss. Under the Indian GAAP, Trade Discount is shown as part of expenses in the statement of profit and loss account.
(f) Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognized in other comprehensive income instead of profit and loss under the Indian GAAP.
(g) Net Deferred tax Liability/Assets is created on the various Ind AS adjustments as applicable. Deferred tax Liability/Assets under Ind AS also includes Minimum alternate tax entitlement which was shown under Loan & advances in the Indian GAAP.
Explanation: For the purpose of this clause, the term âSpecified Bank Notesâ shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economics Affairs number S.0. 3407 (E), dated the 8 November, 2016.
* Represents refund of advances by employees.
20. The operations of Ferro alloys unit of the Company situated at Kothavalasa in Vizianagram district, Andhra Pradesh has been temporarily shut down during previous year due labour problems. During the current year the stated unit has resumed its operations.
21. Previous years'' figures have been re-arranged and regrouped wherever considered necessary. Figures less than 50000 have been shown as absolute number.
22. Note 1 to 62 are annexed to and form integral part of the Balance Sheet and Statement of Profit & L
Mar 31, 2016
(b) TERMS/RIGHTS ATTACHED TO EQUITY SHARES
The company has only one class of equity shares having a par value of '' 2/- per share. Each shareholder is eligible for one vote per equity share held [other than the shares represented by Regulation S Global Depositary Shares (the âGDSsâ) issued by the Company whose voting rights are subject to certain conditions and procedure as prescribed under the Regulation S Deposit Agreement]. The company declares and pays dividends in Indian rupees. The dividend proposed, if any, by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and also has equal right in distribution of Profit/Surplus in proportions to the number of equity shares held by the shareholders.
As on 31st March 2016, 8,802,167 GDSs (8,802,167 GDSs) with 17,604,334 underlying equity shares (17,604,334 equity shares) were outstanding. Each GDS represents 2 underlying equity shares of the Company.
* 1500 shares held by person as nominee of Jindal Stainless Limited.
(d) No bonus, buy back, issue of share other than in cash in last 5 years except about Share Capital suspense account (read with note no. 26)
(e) For details of shares reserved for issue on conversion of warrants, please refer note no. 30 regarding terms of conversion.
Secured Borrowings
(a) The Company has executed a Rupee Term Loan Agreement (âRTLAâ) dated March 23, 2016 of Rs, 260,000.00 Lacs (âTerm Loan Facilityâ) with a consortium of lenders. The said Term Loan Facility are repayable in quarterly installments of Rs130.00 Lacs each during 2016-17, Rs,4,745.00 Lacs each during 2017-18, Rs4,875.00 Lacs each during 2018-19, Rs,5,850.00 Lacs each during 2019-20, Rs, 6,500.00 Lacs each during 2020-21 and thereafter Rs, 7,150.00 Lacs each from 2021-22 to 2026-27. Out of the above, an amount of Rs.118,493.00 Lacs has been disbursed till March 31, 2016.
The Term Loan Facility is secured (charge created/to be created) by first pari-passu charge by way of mortgage of Companyâs immovable properties and hypothecation of moveable fixed assets both present & future and second pari-passu charge by way of hypothecation and/ or pledge of current assets including finished goods, raw materials, work-in-progress, consumable stores and spares, book debts, bills receivable, etc both present and future. (Also read with note no. 31)
Secured Borrowings
* Working Capital Facilities of Jindal Stainless Limited continue to have security on the assets transferred in pursuant to Composite Scheme of Arrangement (Read with note no. 26).
* includes the amount of Rs, 7,063.00 Lacs ('' 48,187.97 Lacs) of working capital facilities and Rs, 23,235.21 Lacs (Rs,37,184.22 Lacs) of buyer credit has been allocated by Jindal Stainless Limited pursuant to Composite Scheme of Arrangement (read with note no. 26) pending confirmation from the respective banks.
(a) Working Capital Facilities are secured (charge created/to be created) by first pari-passu charge by way of hypothecation and/or pledge of current assets including finished goods, raw material, work in progress, consumable stores and spares, book debts, bill receivable, etc both present and future and by way of second charge in respect of other moveable and immoveable properties, both present and future, of the Company. Working Capital Facility is repayable on demand. (Also read with note no. 31)
(b) Buyer Credit Facility are secured (charge created/to be created) by first pari-passu charge by way of hypothecation and/or pledge of current assets including finished goods, raw material, work in progress, consumable stores and spares, book debts, bill receivable, etc both present and future and by way of second charge in respect of other moveable and immoveable properties, both present and future, of the Company. (Also read with note no. 31)
* Include Plant & machinery acquired on Lease amounting to Rs, Nil (Rs, 1,018.52 Lacs) and depreciation thereon during the year Rs, Nil (Rs, 79.40 Lacs); during the current year, on completion of lease terms, the ownership of underlying assets have been transferred to the company.
** Intangible Assets are amortised as under:
Software 5 Years
Goodwill 2 Years
@ Title deeds of Free Hold Land and Building amounting to Rs, 31,812.00 Lacs and Rs, 324.25 lacs respectively are pending to be transfer in the name of the company. However, mutation of whole land at Hisar (other than 97 kanal of land amounting to Rs, 998.00 Lacs) has been recorded by Land Revenue Department in the name of the Company. (Read with note no. 26)
# All assets transferred in terms of Composite Scheme of Arrangement would continue to have security in favour of lenders of Jindal Stainless Limited.
$ include Rs, 1,309.04 Lacs pertaining to sub grade & tailing plant for which permission to operate from odisha government is awaited.
@ Undertaking for non disposing of Investment by way of Letter of Comfort given to banks against credit facilities/financial assistance availed by subsidiaries.
* Lodged with Government Authorities as Security.
# transferred from Jindal Stainless Limited pursuant to the Scheme (note no. 26).
$ Pursuant to the Scheme of Amalgamation between JSL Architecture Limited (Transferor Company) with JSL Lifestyle Ltd. (Transferee Company) becoming effective on 2nd December 2015 w.e.f appointed date i.e. 1st April, 2014. The Transferee Company, in consideration, has issue 76 fully paid up Equity Shares of Rs. 10 each for Every 100 Equity Shares of Rs. 10 each held by the Company in Transferor Company.
* include '' Nil ('' 22,672.34 Lacs) receivable from Jindal Stainless Limited due to implementation of Composite Scheme of Arrangement. (Refer note no. 26)
1. Composite Scheme of Arrangement
1. A Composite Scheme of Arrangement (here in after referred to as âSchemeâ) amongst Jindal Stainless Limited (JSL) and its three wholly owned subsidiaries namely Jindal Stainless (Hisar) Limited (the Company/Transferee/Resulting Company), Jindal United Steel Limited (JUSL) and Jindal Coke Limited (JCL) under the provision of Sec 391-394 lead with 100-103 of the Companies Act, 1956 and other relevant provision of Companies Act, 1956 and / or Companies Act, 2013 has been sanctioned by the Honâble High Court of Punjab & Haryana, Chandigarh vide its Order dated 21st September 2015, modified by order dated 12th October, 2015.
Pursuant to the Section I and Section II of the Scheme becoming effective on 1st November, 2015 w.e.f. appointed date i.e. close of business hours before midnight of March 31, 2014:
a) On 21st November, 2015 the Company has allotted 23,11,85,445 equity shares of Rs, 2/- each (other than in cash) to the equity shareholders of Jindal Stainless Limited (JSL) in the ratio of one equity share of the company for every one equity share held in JSL.
b) The Authorized share capital of the company has been enhanced to Rs, 50,00,00,000 (Rupees Fifty Crore) divided into 24,00,00,000 (Twenty Four Crore) equity shares having face value of Rs, 2 (Two) each and 1,00,00,000 (One Crore) preference shares having face value of Rs, 2 (Rupees Two) each.
c) Out of Rs, 260,000.00 lacs payable to JSL, Rs, 235,924.00 lacs has been paid till date (including Rs, 118,493.00 lacs paid up to 31st March 2016).
d) Against amount of Rs, 36,618.67 Lacs, JSL is required to issue and allot equity shares to the company at a price to be determined in accordance with chapter VII of SEBI (ICDR) Regulations 2009, with the record date jointly decided by the board of directors of JSL and the company being considered as relevant date as specified in the scheme. As specified in the Scheme, the Board of Directors of the Company in the meeting held on 27th May, 2016 have, subject to approval by the Board of Directors of JSL, proposed to fix 8th June, 2016 as the record date for determination of price for allotment of the above said shares. Accordingly, pending allotment by JSL of the aforesaid equity shares to the company, the same has been shown as investment (pending allotment) under âNon-Current Investmentâ.
e) In terms of the Scheme, all the business and activities of Demerged Undertakings and Business Undertaking 1 (as referred in the Scheme) carried on by JSL on and after the appointed date, as stated above, are deemed to have been carried on behalf of the Company. Accordingly, necessary effects have been given in these accounts on the Scheme becoming effective.
f) The necessary steps and formalities in respect of transfer of and vesting in the properties, licenses, approvals and investments in favor of the Company and modification of charges etc. are under implementation.
g) The actual transfer of the leasehold rights of the company in the chromite-ore mine at Orissa (âMining Rightsâ), forming a part of the Demerged Undertakings (as defined in the Scheme), to Jindal Stainless (Hisar) Limited (âJSHLâ), is subject to receipt of necessary approvals from the concerned authorities and compliance with the applicable conditions as prescribed under the Mines and Minerals (Development and Regulation) Act, 1957 (as amended) and as may be prescribed under the final Mineral (Transfer of Mining Lease Granted Otherwise than through Auction for Captive Use) Rules, 2016 and/or any other applicable rules/regulations.
2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs, 4,061.52 Lacs (Rs, 2,391.05 Lacs).
3. Exceptional items includes Gain/ (Loss) (net) of (Rs, 3,663.31 Lacs) {Rs, 620.35 Lacs} on translation/settlement of foreign currency monetary items (including borrowing), gain / (loss) of (Rs, 316.62 Lacs) {(Rs, 22.32 Lacs)} upon marked to market of derivatives contracts, gain/(loss) of Rs, 1,323.70 Lacs {Rs, 998.75 Lacs} on forward cover cancelation and also includes amount written off/provided for of Rs, 1,839.95 Lacs (including provision of Rs, 32.91 Lacs)(Rs, Nil) being non recoverable from certain parties.
4. On 30th March, 2016, the Company has issued and allotted 12,50,00,000 number Compulsory Convertible Warrants (CCW) of Rs, 2/- each to promoter group entities on preferential basis for the purpose to infuse funds by promoters in terms of sanction letter dated 23rd November 2015 by State Bank of India. The CCW are convertible into equity shares at any time after 5 months but not later than 18 months from the date of allotment of CCW at a price to be determined in accordance with the pricing formula provided under chapter VII of the SEBI (ICDR) Regulations, 2009 and computed on the relevant date i.e. thirty days prior to the date on which the allottee(s) will become entitled to apply for equity shares.
As the conversion price for CCW is not yet ascertained and will be ascertained only when the holder of the CCW becomes entitled for conversion, it would presently not be possible to calculate the number of shares to be allotted, till the price of conversion is fixed.
5. (a) The Term Loan Facility and Working Capital Facility (including Buyersâ Credit) of the Company are/will also be secured by the following additional securities:
(i) Unconditional & irrevocable personal guarantee of Mr. Ratan Jindal;
(ii) Unconditional & irrevocable corporate guarantee of Jindal Stainless limited (JSL);
(iii) Pledge of 87.7% of Promoterâs shareholding, as determined on the basis of the filings of the Borrower with the Securities Exchange Board of India (SEBI);
(iv) Pledge of such number of shares of JSL as are held by it other than shares pledged/to be pledged by the Company in favour of lenders of JSL as required under the asset monetization plan approved by the empowered group of corporate debt restructuring lenders of JSL vide their letter dated December 26, 2014
(v) Pledge over investments of the Company in subsidiaries as listed below:
- JSL Lifestyle Limited; and
- JSL Logistics Limited
(vi) Certain conditions, modification and creation of security of the Term Loan Facility are in process of compliance.
(b) The security is to be created by the company over its immovable properties and movable fixed assets, current assets and shares of JSL Lifestyle limited in favour of SBICAP Trustee Company Limited (security Trustee) for lenders of Corporate Term Loan (CTL) of JSL of amounting to Rs,95,800.00 lacs and CDR lenders of JSL.
(c) Term Loan and Working Capital Facilities of Jindal Stainless Limited continue to have security on the assets transferred in pursuant to Composite Scheme of Arrangement (Read with note no. 26).Pending requisite no-objection certificates from the JSL lenders, the necessary steps and formalities in respect of satisfaction/modification of these charges are under implementation.
6. The operations of Ferro alloys unit of the Company situated at Kothavalasa in Vizianagaram district, Andhra Pradesh has been temporarily shut down due labour problems. Management is hopeful to resolve the issue in near future enabling it to resume operations.
* to the extent information available with the company.
7. Research and Development expenses for the year amounting to Rs, 153.74 Lacs (Rs, 157.94 Lacs) on account of revenue expenditure charged/debited to respective heads of accounts.
8. (a) Advance recoverable in cash or in kind or for value to be received includes Interest free loan to employees amounting to Rs, 0.53 Lacs Rs, 15.27 Lacs) in the ordinary course of business and as per employee service rules of the company. Maximum balance outstanding during the year is Rs, 26.08 Lacs (Rs, 24.38 Lacs).
(b) Pursuant to regulation 34 (3) of Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015, Loans and Advances in the nature of Loans to Subsidiaries companies:
* said regulation was not applicable.
@ transferred under the Scheme.
# for the purpose of Cash Flow Support.
9. (a) Certain balances of trade receivable, loan & advance, trade payable and other liabilities are subject to confirmation and/or reconciliation.
(b) The company has given inter corporate deposit to its subsidiary companies amounting to Rs, 3,286.56 Lacs (Rs, 4,498.66 Lacs) (also investment of Rs, 10.10 Lacs (Rs, 420.11 Lacs)) where the subsidiary companies has accumulated losses\negative net worth. In view of the long term involvement of the company and future prospectus, in the opinion of the management, these are good and realizable hence no provision has been considered necessary.
Note: INR equivalent values have been calculated at the yearend exchange rates in INR to give an indicative value of the contracts in rupees. Actual hedges however may be in different currency denominations.
b) Foreign Currency exposure that are not hedged by derivative instruments or otherwise outstanding as on 31st March, 2016 is as under:
10. The Haryana Government levied w.e.f. 05.05.2000 a Local Area Development Tax (the LADT Act) on the Manufacturing units in the State of Haryana on the entry of goods for use and consumption which has been challenged in the Honâble Punjab and Haryana High Court. The Honâble Punjab and Haryana High Court disallowed the petition in December, 2001 and the company had by a Special Leave Petition challenged the Order of High Court in the Honâble Supreme Court. The Honâble Supreme Court referred the matter to a âfive judgesâ Constitutional Bench, which laid certain parameters to examine the Act on those lines. On the basis of these parameters the Honâble High Court have declared the Act to be ultra virus on 14th March, 2007. Since, this issue was being canvassed by various High Courts, the Honâble Supreme Court gave an Interim Order that those states where the High Courts have given judgment in favour of the petitioner, no tax would be collected. In the mean time the Haryana Government has repealed the LADT Act and introduced another Act by the name of âEntry Taxâ on the same lines. That Act was also been held ultra vires by the High Court. The order of Punjab and Haryana High Court and other judgments of all the Courts of India have been long pending. The State Governments have requested the Honâble Supreme Court that it is very difficult for them to run the Government. So at least till the pendency of the cases in the Honâble Supreme Court they may be allowed to charge from past liability and also from the future liability to be accrued. On 30th October, 2009, the Honâble Supreme Court have directed that 1/3rd of the liability is to be paid by all the assesses whose cases are pending in the High Courts. As, at present, there is no Act either LADT/Entry Tax prevalent in Haryana State, no tax is being collected from the assesses however undertaking have given by assesses that in case they lose they will make the payment. As such on prudence basis, full liability had been provided for. In the meantime, i.e. on 16.04.2010 the Entry Tax matters of the states have been referred to a larger 9-Judges Constitutional Bench of the Supreme Court, where the judgment of 7-Judges Constitutional Bench past 49 years ago would be revisited. Constitution Bench has not been constituted as yet and the status of the case is as it is and at present no tax is being collected/paid in Haryana.
The expected return on the plan assets is determined considering several applicable factors mainly the composition of plan assets held, assessed risk of assets management, historical results of returns on the plan assets and the policy for the management of plan assets management.
The estimates of future salary increase, considered in actuarial valuation, taking into account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.
f) The company makes monthly contributions to Provident Fund managed by Trust for qualifying employees. Under the scheme, the company is required to contribute a specified percentage of the payroll costs to fund the benefits.
In keeping with the Guidance on Implementing Accounting Standard (AS) 15 (Revised) on Employee Benefits notified by the companies (Accounting Standards) Rules, 2006, employer established provident fund trusts are treated as Defined Benefit Plans, since the Company is obliged to meet interest shortfall, if any, with respect to covered employees. Accounting to the actuarial Valuation, the Defined Benefit Obligation of Interest Rate Guarantee on exempted Provident Fund in respect of employees of the company as on 31st March, 2016 works out of '' Nil ('' Nil)and hence no provision is required to be provided for in the books of account towards the guarantee for notified interest rates.
11. Finance Lease
Assets acquired under leases where the company has substantially all the risks and rewards of ownership are classified as finance lease. Such assets are capitalized at inception of the lease at the lower of the fair value or net present value if minimum lease payments and a liability is created for an equivalent amount.
Lease interest charged to profit & loss for right to use of CTL Machine (Cut to length) for the services regarding cutting of Stainless Steel sheets.
The agreements are executed for a period of 60 months with the clause that the ownership of the CTL shall be automatically transferred to lessee on the zero value.
12 Previous yearsâ figures have been re-arranged and regrouped wherever considered necessary .
13 Figures in bracket indicate previous year figures.
14 Note 1 to 49 are annexed to and from integral part of the Balance Sheet and Statement of Profit & Loss.
Mar 31, 2015
1. Composite Scheme of Arrangement
1. A Composite Scheme of Arrangement (here in after referred to as
'Scheme') amongst Jindal Stainless Limited (JSL) and its three wholly
owned subsidiaries namely Jindal Stainless (Hisar) Limited (the
Company/Transferee/Resulting Company), Jindal United Steel Limited
(JUSL) and Jindal Coke Limited (JCL) under the provision of Sec 391-394
lead with 100-103 of the Companies Act, 1956 and other relevant
provision of Companies Act, 1956 and / or Companies Act, 2013 has been
sanctioned by the Hon'ble High Court of Punjab & Haryana, Chandigarh
vide its Order dated 21st September 2015, modified by order dated 12th
October, 2015. The Schemes inter-alia includes:-
a) Demerger of the Demerged Undertakings (as defined in the scheme) of
JSL comprising of the Ferro Alloys Division located at Jindal Nagar,
Kothavalasa (AP) and the Mining Division of JSL and vesting of the same
in the Company w.e.f. appointed date i.e. close of business hours
before midnight of March 31,2014. (Section I of the Scheme)
b) Transfer of the Business undertaking 1 (as defined in the scheme) of
JSL comprising of the Stainless Steel Manufacturing Facilities of JSL
located at Hisar, Haryana and vesting of the same with the Company on
Going Concern basis by way of Slump Sale along with investments in the
domestic subsidiaries (listed in Part B of schedule 2 of the Scheme) of
JSL w.e.f. from appointed date i.e. close of business hours before
midnight of 31st March, 2014. (Section II of the Scheme)
c) Transfer of the Business undertaking 2 (as defined in the scheme) of
JSL comprising, inter-alia, of the Hot Strip Plant of JSL located at
Odisha and vesting of the same in Jindal United Steel Limited on Going
Concern basis by way of Slump Sale w.e.f. appointed date i.e. close of
business hours before midnight of March 31,2015. (Section III of the
Scheme)
d) Transfer of the Business Undertaking 3 (as defined in the Scheme) of
JSL comprising, inter-alia ,of the Coke Oven Plant of JSL Located at
Odisha and vesting of the same with Jindal Coke Limited on Going
Concern basis by way of Slump Sale w.e.f. appointed date i.e. close of
business hours before midnight of March 31,2015. (Section IV of the
Scheme)
Section I and Section II of the Scheme became effective on 1st
November, 2015, operative from the said appointed date (as stated in
sub-para (a) and (b) above) and Section III and Section IV (for section
III and IV appointed date as stated in sub-para (c) and (d) above) of
the Scheme will become effective on receipt of necessary approvals for
transfer/grant of the right to use in the land on which Hot Strip &
Coke Oven Plants are located as specified in the Scheme.
2. Pursuant to the Section I and Section II of the Scheme becoming
effective:
a) Demerged Undertakings and Business undertaking 1 has been
transferred to and vested in the Company with effect from the said
Appointed Date; accordingly the same has been given effect to in these
accounts.
b) The surplus of Rs, 53,888.94 Lacs of assets over the liabilities
pertaining to the Demerged Undertakings transferred to and vested in
the Company and the paid up face value of the equity shares & CCCPS
issued by JSL has been credited in Security Premium Account.
c) The company is to issue equity shares/CCCPS on a record date to be
fixed as specified in the Scheme for allotment of (i) equity shares
having face value of Rs, 21- each credited as fully paid up; and (ii)
CCCPS having face value of Rs, 21- each credited as fully paid up of the
Company to the equity shareholders and holders of CCCPS respectively of
JSL in the ratio one equity shares/CCCPS of the company for every one
equity shares/CCCPS held in JSL. Pending allotment the same has been
shown as "Share Capital Suspense Account".
d) Share capital of the Company comprising of 250000 equity shares
having face value of Rs, 2 each, 100% held by JSL deemed to has been
cancelled and transferred to capital reserve; which will give effect
immediately after issuance of the shares by the Company to the
Shareholders of JSL.
e) The Authorized share capital of the company is to be enhanced to Rs,
50,00,00,000 (Rupees Fifty Crore) divided into 24,00,00,000 (Twenty
Four Crore) equity shares having face value of Rs, 2 (Two) each and
1,00,00,000 (One Crore) preference shares having face value of Rs, 2
(Rupees Two) each.
f) Business Undertaking 1 (as defined in sub-para (b) of 1 above) has
been transferred to and vested in the Company at a lump sum
consideration of Rs, 280,979.52 Lacs; out of this Rs, 260,000.00 lacs shall
be paid to JSL and Rs, 20,979.52 Lacs has been adjusted against sum of Rs,
57,598.19 lacs lying receivable from JSL in the books of the Company.
Against the balance amount of Rs, 36,618.67 Lacs, JSL is to issue equity
shares to the company at a price to be determined with the record date
to be fixed as specified in the Scheme. Pending allotment the same has
been shown as "Equity Shares pending allotment" under Long Term
Investments.
g) On transfer of Business Undertaking 1, the difference between the
fair values of assets and liabilities transferred to and vested in the
Company and the lump sum consideration to be paid as stated above
amounting to Rs, 2,068.81 Lacs has been debited to Goodwill Account.
h) In terms of the Scheme, all the business and activities of Demerged
Undertakings and Business Undertaking 1 carried on by JSL on and after
the appointed date, as stated above, are deemed to have been carried on
behalf of the Company. Accordingly, necessary effects have been given
in these accounts on the Scheme becoming effective.
i) The necessary steps and formalities in respect of transfer of and
vesting in the properties, licenses, approvals and investments in favor
of the Company and modification of charges etc. are under
implementation. Further transfer of and vesting in the Mining Rights to
Demerged Undertakings (as referred in para 1 (a) above) is subject to
necessary approvals of the concerned authorities.
2. The financial statements of the Company for the year ended 31st
March, 2015 were earlier approved by the Board of Directors at their
meeting held on 25th May, 2015 on which the Statutory Auditors of the
Company had issued their report dated 25th May, 2015. These financial
statements have been reopened and revised to give effect to the Scheme
as stated in note 1 & 2 herein above.
3. Current year's figures are not comparable with those of the
previous year for the reasons as stated in note 1 & 2 herein above.
4. Estimated amount of contracts remaining to be executed on capital
account and not provided for (net of advances) is Rs, 2,391.05 Lacs (Rs,
NIL).
5. Exceptional items includes Gain/(Loss) (net) of Rs, 620.35 Lacs {Rs,
NIL} on translation/settlement of foreign currency monetary items
(including borrowing), gain / (loss) of (Rs, 22.32 Lacs) {Rs,' NIL} upon
marked to market of derivatives contracts, gain/(loss) of Rs, 998.75 Lacs
{Rs, NIL} on forward cover cancelation.
6. A Scheme of Amalgamation between JSL Architecture Limited
(Transferor Company) with JSL Lifestyle Ltd. (Transferee Company) was
filed with the Hon'ble High Court of Punjab and Haryana at Chandigarh
entailing transfer of all the assets and liabilities including reserves
of the Transferor Company at existing carrying amount w.e.f. appointed
date i.e. 1st April, 2014. The Transferee Company, in consideration,
would issue 76 fully paid up Equity Shares of Rs, 10 each for Every 100
Equity Shares of Rs, 10 each held by the shareholders of Transferor
Company. The Scheme is has been approved by the Hon'ble High Court
vide its moral judgment dated 30th October, 2015. Upon receipt of the
certified true copy of the order, both the Companies shall file the
same with the office of the Registrar of Companies, NCT of Delhi and
Haryana and the Scheme shall become effective from the date of such
filing.
7. The company had received a notice during the year 2012-2013 from
office of the Dy. Director of Mines, Jajpur Road Circle, Odisha (the
Office) asking company to deposit Rs, 8,540.27 Lacs with the department
on account of cost price on mining of excess quantity of Chrome Ore
over and above the approved quantity of mining plan/scheme. The company
has disputed and challenged the same as demand made by the Office is
incorrect, unjustified, baseless and was without furnishing any
supporting documents and/or providing any basis/reason for such demand.
The case is pending before Provisional Authority of Mining tribunal,
Govt, of India.
8. Pursuant to the requirements of Schedule II of the Companies Act,
2013, the Company has, effective April 1,2014, reviewed and revised the
estimated useful lives of its fixed assets related to Vizag and Mine
Divisions. Consequent thereto, the depreciation charge for the year
ended on 31st March, 2015 is lower by Rs, 147.59 Lacs. Further based on
transitional provision of Schedule II, an amount of f 13.84 Lacs has
been adjusted against the retained earnings.
9. Based on the intimation received from supplier regarding their
status under the Micro, Small and Medium Enterprises Development Act,
2006, the required disclosure is given below *:
10. (A) Certain balances of trade receivable, loan & advance, trade
payable and other liabilities are subject to confirmation and/or
reconciliation.
(B) Although the book value fair value of certain unquoted investments
amounting to Rs, 420.11 Lacs (Rs, NIL), as reflected in Note no 11, is
lower than the cost or companies are having negative net worth,
considering the strategic and long term nature of the investment,
future prospectus and assets base of the investee company, such
decline, in the opinion of the management, has been considered to be of
temporary nature and hence no provision for the same at this stage is
considered necessary.
The company has also given inter corporate deposit to its subsidiary
companies amounting to Rs,4,498.66 Lacs (Rs, NIL) where the subsidiary
companies has accumulated losses
egative net worth. In view of the
long term involvement of the company (read with note (B) above) in the
said companies no provision has been considered necessary.
11. Advance recoverable in cash or in kind or for value to be received
includes Interest free loan to employees amounting to Rs, 15.27 Lacs (Rs,
NIL) in the ordinary course of business and as per employee service
rules of the company. Maximum balance outstanding during the year is Rs,
24.38 Lacs (Rs, NIL).
12. Research and Development expenses for the year amounting to Rs,
157.94 Lacs (Rs, NIL) on account of revenue expenditure charged/debited
to respective heads of accounts.
13. a) Derivative contracts entered into by the company and
outstanding as on 31st March, 2015 for hedging currency risks:
Note: INR equivalent values have been calculated at the yearend
exchange rates in INR to give an indicative value of the contracts in
rupees. Actual hedges however may be in different currency
denominations.
14. The Haryana Government levied w.e.f. 05.05.2000 a Local Area
Development Tax (the LADT Act) on the Manufacturing units in the State
of Haryana on the entry of goods for use and consumption which has been
challenged in the Hon'ble Punjab and Haryana High Court. The Hon'ble
Punjab and Haryana High Court disallowed the petition in December, 2001
and the company had by a Special Leave Petition challenged the Order of
High Court in the Hon'ble Supreme Court. The Hon'ble Supreme Court
referred the matter to a 'five judges' Constitutional Bench, which laid
certain parameters to examine the Act on those lines. On the basis of
these parameters the Hon'ble High Court have declared the Act to be
ultra virus on 14th March, 2007. Since, this issue was being canvassed
by various High Courts, the Hon'ble Supreme Court gave an Interim Order
that those states where the High Courts have given judgment in favor of
the petitioner, no tax would be collected. In the mean time the Haryana
Government has repealed the LADT Act and introduced another Act by the
name of 'Entry Tax' on the same lines. That Act was also been held
ultra vires by the High Court. However, on prudence basis, the
liability has been fully provided for. The order of Punjab and Haryana
High Court and other judgments of all the Courts of India have been
long pending. The State Governments have requested the Hon'ble Supreme
Court that it is very difficult for them to run the Government. So at
least till the pendency of the cases in the Hon'ble Supreme Court they
may be allowed to charge from past liability and also from the future
liability to be accrued. On 30th October, 2009, the Hon'ble Supreme
Court have directed that 1/3rd of the liability is to be paid by all
the assesses whose cases are pending in the High Courts. As, at
present, there is no Act either LADT/Entry Tax prevalent in Haryana
State, no tax is being collected from the assesses however undertaking
have given by assesses that in case they lose they will make the
payment. As such on prudence basis, full liability has been provided
for. In the meantime, i.e. on 16.04.2010 the Entry Tax matters of the
states have been referred to a larger 9- Judges Constitutional Bench of
the Supreme Court, where the judgment of 7-Judges Constitutional Bench
past 49 years ago would be revisited. Constitution Bench has not been
constituted as yet and the status of the case is as it is and at
present no tax is being collected/paid in Haryana.
The expected return on the plan assets is determined considering
several applicable factors mainly the composition of plan assets held,
assessed risk of assets management, historical results of returns on
the plan assets and the policy for the management of plan assets
management.
The estimates of future salary increase, considered in actuarial
valuation, taking into account of inflation, seniority, promotion and
other relevant factors, such as supply and demand in the employment
market.
(a) The company makes monthly contributions to Provident Fund managed
by Trust for qualifying employees. Under the scheme, the company is
required to contribute a specified percentage of the payroll costs to
fund the benefits.
In keeping with the Guidance on Implementing Accounting Standard (AS)
15 (Revised) on Employee Benefits notified by the companies (Accounting
Standards) Rules, 2006, employer established provident fund trusts are
treated as Defined Benefit Plans, since the Company is obliged to meet
interest shortfall, if any, with respect to covered employees.
Accounting to the actuarial Valuation, the Defined Benefit Obligation
of Interest Rate Guarantee on exempted Provident Fund in respect of
employees of the company as on 31 st March, 2015 works out of Rs, Nil (Rs,
Nil) and hence no provision is required to be provided for in the books
of account towards the guarantee for notified interest rates.
15. Finance Lease
Assets acquired under leases where the company has substantially all
the risks and rewards of ownership are classified as finance lease.
Such assets are capitalized at inception of the lease at the lower of
the fair value or net present value if minimum lease payments and a
liability is created for an equivalent amount.
Lease interest charged to profit & loss for right to use of CTL Machine
(Cut to length) for the services regarding cutting of Stainless Steel
sheets.
# does not include Rs, 37.48 Lacs allocated from Jindal Stainless Limited
pursuant to Composite Scheme of Arrangement (refer note no 26)
45 Capital work-in-progress (CWIP) includes technical know-how and
supervision fees, taxes, machinery under installation/in transit,
pre-operative expenses and other assets under erection. Details of same
areas under:-
16 Previous years' figures have been re-arranged and regrouped wherever
considered necessary.
17 Figures in bracket indicate previous year figures.
18. Note 1 to 49 are annexed to and from integral part of the Balance
Sheet and Statement of Profit & Loss.
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Jindal Stainless (Hisar) Ltd. குறித்த கூடுதல் தகவல்களை
-
Jindal Stainless (Hisar) Ltd. டூல்ஸ்
- பல்க் டீல்ஸ்
- பிளாக் டீல்ஸ்
-
Jindal Stainless (Hisar) Ltd. நிறுவன தகவல்கள்
- நிறுவன சுயவிவரம்
- நிறுவன வரலாறு
- நிர்வாக குழு
- மூலதன வடிவம்
- புராடெக்ட் மிக்ஸ்
- வங்கியாளர்/தணிக்கையாளர்/பதிவாளர்
-
நிறுவன வரலாறு
- மும்பை பங்குச் சந்தையில் விலை வரலாறு
- என்எஸ்இ விலை வரலாறு
-
Jindal Stainless (Hisar) Ltd. முக்கிய நிதியில் விகிதங்கள்
- விகிதங்கள்
-
Jindal Stainless (Hisar) Ltd. முடிவுகள்
- காலாண்டு முடிவுகள்
- அரையாண்டு முடிவுகள்
- 9 மாத முடிவுகள்
- வருடாந்திர முடிவுகள்
-
Jindal Stainless (Hisar) Ltd. நிதியியல் தகவல்கள்
- தணிக்கை முடிவுகள்
- பணப்பாய்வு
- இருப்பு நிலைக்குறிப்பு
-
Jindal Stainless (Hisar) Ltd. அறிக்கை
- கணக்கியல் கோட்பாடுகள்
- தணிக்கையாளர்கள் அறிக்கை
- இயக்குநர்கள் அறிக்கை
- கணக்கு குறிப்புகள்
-
Jindal Stainless (Hisar) Ltd. கார்ப்பரேட் அறிவிப்புகள்
- புத்தக முடிவு
- நிர்வாகக் குழுக் கூட்டங்கள்
