(p) Provision, Contingent Liabilities and Contingent Assets,
legal or constructive
Provisions are recognized when there is a present obligation
(legal or constructive) as a result of a past event and it is
probable ("more likely than not") that it is required to settle the
obligation, and a reliable estimate can be made of the amount
of the obligation. The amount recognised as a provision is the
best estimate of the consideration required to settle the present
obligation at the balance sheet date, taking into account the
risks and uncertainties surrounding the obligation. Where a
provision is measured using the estimated cash flows to settle
the present obligation, its carrying amount is the present value
of those cash flows. The discount rate used is a pretax rate that
reflects current market assessments of the time value of money
in that jurisdiction and the risks specific to the liability.
A contingent liability is a possible obligation that arises from a
past event, with the resolution of the contingency dependent
on uncertain future events, or a present obligation where no
outflow is probable. Material contingent liabilities are disclosed
in the financial statements unless the possibility of an outflow
of economic resources is remote. Contingent assets are not
recognized in the standalone financial statements unless it is
virtually certain that the future event will confirm the asset's
existence and the asset will be realised.
2D Recent Indian Accounting Standards (Ind AS)/
Pronouncements
Ministry of Corporate Affairs ("MCA") notifies new standards or
amendments to the existing standards under Companies (Indian
Accounting Standards) Rules as issued from time to time. There
is no such notification which would have been applicable from
1st April, 2025 for which the impact on the Standalone Financial
Information is required to be disclosed.
Security
Cash credit, Packing Credit & Working Capital Demand Loan
(a) Cash credit facility from Bank of Baroda with a sub-limit of letter of credit (ILC/FLC/SBLC), carrying variable interest (presently @ 8.90% p.a.),
secured by:
Security details
- First pari-pasu charge on the entire current assets of the company, both present and future.
- 10 % cash Margin in the Form of FDR on L/C Limit utilization basis.
- 10 % cash Margin in the Form of FDR on P/C Limit utilization basis .
- 10 % cash Margin in the Form of FDR on BG Limit utilization basis. (In case of disputed liabilities / Court cases 100% cash Margin).
Collateral security
- First Pari Passu Charge by way of Equitable Mortgage on Factory Lands along with Shed & Building thereon.
- First Pari Passu Charge on Entire Fixed Assets of the Company except Land & Building as above.
- Lien on FDR for B3.60 million (P.Y. 3.38 million) in the name of the Company.
- Personal Guarantee
Above facilities are secured by personal guarantee of three Promoter directors.
(b) Cash credit facility from Citi Bank with a sub-limit of Working Capital Demand Loan (WCDL), Packing Credit, Pre and Post Shipment - Under
LCs/ PO and Sight/ Usance Letter of credit, carrying variable interest (presently @ 8.75% p.a.), secured by:
Security details
- First paripasu charge on the Stock and Book debts of the company both present and future.
- First Paripasu Charge on Entire Plant & Machinery and other movable assets of the company present and future.
- First Paripasu charge by way of Equitable Mortgage on factory land along with shed, building etc located at Jalan Industrial Complex,
Domjur, District, Howrah and at Belur 189, Girish Ghosh Road, Howrah, owned by the Company.
- Cash margin of 10% on SLC/ULC and BG.
- Personal Guarantee
Above facilities are secured by personal guarantee of two Promoter directors.
(c) Cash credit facility from HDFC Bank with a sub-limit of Working Capital Demand Loan (WCDL), Packing Credit, Pre and Post Shipment -
Under LCs/ PO and Sight/ Usance Letter of credit, carrying variable interest (presently @ 8.5% p.a.), secured by:
Security details
- First paripasu charge on the Stock and Book debts of the company both present and future.
- First paripasu charge on movable fixed assets of the company present and future.
- First paripasu charge by way of Equitable Mortgage on factory land along with shed, building etc located at Jalan Industrial Complex,
Domjur, District, Howrah and at Belur 189, Girish Ghosh Road, Howrah, owned by the Company.
- Cash margin of 10% on SLC/ULC and BG.
Paripassu charges as stated above are subject to approval yet to be received from other Banks.
- Personal Guarantee
Above facilities are secured by personal guarantee of one Promoter director.
Reasons for variance:
1) Current ratio increased on reduction of absolute figures of both Current Assets & Current Liabilities, on payment of other financial liabilities.
2) Debt Service Coverage Ratio improved due to incease in EBITDA and reduction of Debt obligation.
3) Increase in profit after tax led to increase in the return on equity ratio.
4) Trade Payable Turnover Ratio improved on increased purchases with same level of Average Trade Payable.
5) Net Profit ratio increased due to higher profitability as compared with preceeding year.
6) Return on Capital employed variation is due to increased profitability as compared to preceeding year.
42 Borrowing from banks and financial institutions
The Company has obtained borrowings from banks on the basis of security of current assets. The particulars of statements of current assets filed
by the Company with the Banks for each quarter ended during the year are as under:
Valuation techniques to determine Fair Value
(i) The management assessed that fair value of trade receivables, cash and cash equivalents, other bank balances, loans, borrowings,
trade payables and other current financial assets and liabilities approximate their carrying amounts largely due to the short term
maturities of these instruments.
(ii) The fair values of the equity investment which are quoted, are derived from quoted market prices in active markets. The Investment
measured at fair value (FVTOCI) and falling under fair value hierarchy Level 2 is valued on the basis of valuation report provided by
external valuer.
(iii) The fair values of investments in mutual fund units is based on the net asset value ('NAV') as stated by the issuers of these mutual
fund units in the published statements as at Balance Sheet date. NAV represents the price at which the issuer will issue further units
of mutual fund and the price at which issuers will redeem such units from the investors.
(iv) The Company enters into derivative financial instruments with few financial institutions. Commodity contracts are valued using the
forward LME rates of commodities actively traded on the listed metal exchange i.e. London Metal Exchange, United Kingdom (U.K.) [a
level 2 technique]. The changes in counterparty risk had no material effect on the hedge effectiveness assessment for the derivatives
designated in hedge relationship and the value of the other financial instrument recognised at fair value.
C. Financial Risk Management
The Company's activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company continues
to focus on a system-based approach to business risk management. The Company's financial risk management process seeks to enable the
early identification, evaluation and effective management of key risks facing the business. Backed by strong internal control systems, the
current Risk Management System rests on policies and procedures issued by appropriate authorities; process of regular reviews / audits to
set appropriate risk limits and controls; monitoring of such risks and compliance confirmation for the same.
(i) Market Risk
Market risk is the risk of any loss in future earnings, in realisable fair values or in future cash flows that may result from a change in the price
of a financial instrument. The value of a financial instrument may change as a result of changes in interest rates, foreign currency exchange
rates, equity price fluctuations, liquidity and other market changes. Future specific market movements cannot be normally predicted with
reasonable accuracy.
As at March 31,2025, 5% increase/(decrease) in the exchange rate of Indian Rupee with foreign currencies would result in approximately
B9.12 millions (decrease) / increase in the fair value of the Company's foreign currency dollar denominated instruments (As at March 31
2024, B7.59 millions)
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market
interest rates. The company's exposure to the risk of changes in market interest rates relates primarily to the company long term and short
term borrowing with floating interest rates. The company constantly monitors the credit markets and rebalances its financing strategies tc
achieve an optimal maturity profile and financing cost.
Fixed rate instruments that are carried at amortised cost are not subject to interest rate risk for the purpose of sensitivity analysis.
As at March 31, 2025, 100 basis points (1%) increase/(decrease) in the interest rate at Indian currency borrowings would result in
approximately B0 millions in the finance cost of the Company's Indian currency borrowings (As at March 31,2024, B0.02 millions)
Price Risk
The Company invests its surplus funds primarily in equity shares, mutual funds and GOI Bonds measured at fair value. Aggregate value of
such investments as at March 31,2025 is B330.33 million (As at March 31,2024 B354.42 millions)
Increase/(decrease) of 5% would result in an impact increase/(decrease) by B 16.515 millions and B 17.72 millions on total profit for the year
ended March 31,2025 & March 31,2024
(iii) Credit Risk
Credit risk is the risk of financial loss in case counter-party to a financial instrument fails to repay debt according to the contractual
terms or obligations. Credit risk encompasses both the direct risk of default and the risk of deterioration of credit worthiness as well as
concentration risks.
Financial instruments that are subject to credit risk and concentration thereof principally consist of trade receivables and loans, investments
in debt oriented mutual funds and other financial assets.
In respect of trade and other receivables, the company is not exposed to any significant credit risk exposure to any single party. Trade
receivables consist of major customers belonging to Tyre & Rubber Industries. The company has very limited history of customer default,
and considers the credit quality of trade receivables, that are not past due or impaired, to be good.
The credit risk for cash and cash equivalents and bank deposits is considered negligible, since the counterparties are reputable organisations
with high quality external credit ratings.
The exposure to credit risk was B1274.66 millions & B 1007.86 millions, as at March 31,2025 and March 31,2024 respectively, being the total
carrying value of trade receivables, loans, investments in debt oriented mutual funds/govt securities and other financial assets.
(iv) Capital Management
The Company's policy is to maintain a strong capital base for future development of the business. For the purpose of Company's capital
management, capital includes issued capital and all other equity attributable to equity shareholders of the Company. As at March 31,2025,
the Company has only one class of equity shares.
(v) Hedging activity and derivatives
Fair value hedge of Zinc metal price risk
The Company is exposed to fluctuations in zinc metal price on purchase, sale and inventories lying with the company. To manage the
variations in fair value, the company enters into derivative financial instruments relating to the highly probable forecasted transactions to
mitigate the risk associated with zinc metal price fluctuations. Such derivative financial instruments are primarily in the nature of future
commodity contracts.
44 Other Regulatory Information :
(i) The Company does not have any Benami property and no proceeding has been initiated or pending against the Company for holding any
Benami property.
(ii) The Company does not have any transactions with struck off Companies.
(iii) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies (Restriction
on number of Layers) Rules, 2017.
(iv) The Company has not advanced or given loan 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.
(v) 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.
(vi) 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.
(vii) The Company has not traded or invested in Crypto currency or Virtual Currency during the year.
(viii) The Company has not been declared as wilful defaulter by any bank or financial institution or other lender.
(ix) There are no charges or satisfaction yet to be registered with ROC beyond the statutory period.
IPO proceeds which were un-utilised as at March 31,2025 were invested in term deposits amounting to B 934.90 million with scheduled bank.
46 Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification/disclosure.
Accordingly, amounts and other disclosures for the preceding year are included as an integral part of the current year's standalone financial
statements and are to be read in relation to the amounts and other disclosures relating to the current year.
The accompanying notes are an integral part of the standalone finacial statements.
As per our report of even date For and on behalf of the Board of Directors of
For, S. Jaykishan J.G.Chemicals Limited
Chartered Accountants
Firm's Registration Number: 309005E Suresh Jhunjhunwala Anirudh Jhunjhunwala
Executive Chairman CEO & Managing Director
CA Ritesh Agarwal DIN No. 00234725 DIN No. 00234879
Partner
Membership M°. 062410 Anuj Jhunjhunwala Swati Poddar
Place : Kolkata Whole time Director & CFO CS & Compliance Officer
Date: The 17th day of May , 2025 DIN No. 00234926 Membership No. : A49212
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