f. The Company does not face liquidity risk with regard to its lease liabilities as the current assets are sufficient to meet the obligations related to lease liabilities as and when they fall due.
g. The Company has also taken certain office premises and office equipment on lease with contract terms within one year. These leases are short-term and/or leases of low-value items. The Company has elected not to recognize right-of-use-assets and lease liabilities for these leases. The expenses relating to short-term leases and /or leases of low-value items has been applied have been charged to the Statement of Profit and Loss .
Notes to the Standalone Financial Statements
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for the year ended 31 March 2024 Note 6a - Loans
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(Amount in ?million, unless otherwise stated)
|
| |
As at 31 March 2024
|
As at 31 March 2023
|
|
Loans to related parties
|
6.27
|
2.23
|
| |
6.27
|
2.23
|
|
Loan is given for working capital requirement to the related parties.
|
|
|
|
Note 6b - Other financial assets
|
|
|
| |
As at 31 March 2024
|
As at 31 March 2023
|
|
Non-current
|
|
Security deposits
|
2.92
|
2.79
|
|
Bank deposits
|
|
72.36
|
| |
2.92
|
75.15
|
| |
|
|
| |
As at 31 March 2024
|
As at 31 March 2023
|
|
Current
|
|
Bank deposits due within twelve months
|
49.56
|
19.50
|
|
Security deposits
|
0.02
|
0.02
|
|
Receivable from online marketplace portals**
|
26.57
|
21.46
|
|
Advance given to broker for purchase of shares
|
7.13
|
-
|
| |
83.28
|
40.98
|
|
**Represent receivable in relation to sale made through online marketplace.
|
|
|
|
Note 7 -Other tax asset (net)
|
|
|
| |
As at 31 March 2024
|
As at 31 March 2023
|
|
(a) Non-Current
|
|
Advance income-tax (net of provision amounting to ? Nil (31 March 2023 156.11 million))
|
-
|
11.10
|
|
(b) Current
|
|
Advance income-tax
|
|
9.32
|
|
20.42
|
|
Note 8 - Inventories
(At lower of cost and net realizable value)
|
|
|
| |
As at 31 March 2024
|
As at 31 March 2023
|
|
Stock-in-trade*#
|
287.58
|
328.25
|
| |
287.58
|
328.25
|
a) The above figure of inventory is net of write down of inventory cost to net realisable value during the year amounting
to ?8.76 millions (31 March 2023 ?3.60 millions).
140 I NURECALTD.
a) Rights, preferences and restrictions attached to equity shares
As per the memorandum of association, the Company's authorized share capital consist of equity shares. All equity shares rank equally with regard to dividends and share in the Company's residual assets. The equity shares are entitled to receive dividend as declared from time to time. Shareholders are entitled to one vote per equity share held in the Company. On winding up of the Company, the holders of equity shares will be entitled to receive the residual assets of the Company, remaining after distribution of all preferential amounts in proportion to the number of equity shares held.
Note:- As per approval of Honourable National Company Law Tribunal ('NCLT') for the scheme of arrangement ('Scheme') among Nectar Biopharma Private Limited (demerged company) and Nureca Private Limited (resulting company) and their respective shareholders and creditors under section 230 to 232 and other applicable provisions of the Companies Act 2013, with effect from appointed date of 1 April 2019, the Company had cancelled 10,000 shares and issued 1,000,000 shares for consideration other than cash on 10 June 2020.
e) Initial public offer
During the year ended 31 March 2021, the Company had made Initial Public Offering of 2,500,175 equity shares of face value of C10 each for cash consisting 2,496,675 equity shares to public other than employees at a price of C400 per equity share (including a share premium of C390 per equity share) and 3,500 equity shares to the employees at a price of C380 per equity share (including a share premium of C370 per equity shares) aggregating to C1000.00 million. These equity shares were allotted on 23 February 2021 and the equity share of the Company got listed on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on 25 February 2021.
Nature of reserves
a. Capital reserve
Capital reserve is on account of the business combination under common control as per the Court approved scheme.
b. Security premium
Securities premium account is used to record the premium on issue of shares. The reserve is utilized in accordance with the provisions of the Companies Act, 2013.
c. Retained earnings
Retained earnings comprises of undistributed earnings after taxes.
Note:
(a) 'Term loan from bank. amounting to C4.01 million (31 March 2023: C Nil) carrying interest rate of 8.50% p.a. (31 March 2023: Nil) is secured by exclusive charge by way of hypothecation on Car. The loan is repayable in 60 (31 March 2023: Nil) equal monthly installments.
Also, the Ministry of Micro, Small and Medium Enterprises has issued an Office Memorandum dated 26 August 2008 which recommends that the Micro and Small Enterprises should mention in their correspondence with its customers the Entrepreneurs Memorandum Number as allocated after filing of the Memorandum. The information regarding Micro Enterprises and Small Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Company. Refer note 35 for the disclosure in respect of amounts payable to such enterprises as at year end that has been made in the financial statements based on information available with the Company.
# Refer note 35
Contract liabilities represents amount received from customers as per the terms of purchase order to deliver goods and expected sale return from the sale of goods. Once the goods are delivered and control is transferred to customers the same Is adjusted accordingly.
The amount of revenue C3.02 million (31 March 2023 C9.23 millions) recognised in the reporting period was included in the contract liability balance at the beginning of the period.
#During the previous years, the Company had incurred CSR expenditure in excess of the required limits as per Section 135 of the Companies Act. The Company recorded this expenditure as CSR asset since the Company had right to claim set off excess CSR expenditure against future CSR obligations for next three years as per the Act. In the current year, the Company has estimated the expected utilization against future CSR obligations for the balance time period and recorded CSR expenditure amount of CC5.3 million In the current year. Further, no CSR expenditure was required to be incurred as per Section 135 of the Act in the current year.
Note 32 - Segment information
The Board of directors of Nureca Limited takes decision in respect of allocation of resources and assesses the performance basis the reports/ information provided by functional heads and is thus considered to be Chief Operating Decision Maker(CODM).
The Company is engaged in home healthcare and wellness products mainly in the domestic market only which is considered to be a single business segment / geographical segment by CODM.
Considering the nature of Company's business and operations, there are no separate reportable segments (business and/ or geographical) in accordance with the requirements of Ind AS 108 'Operating Segments' and hence, there are no additional disclosures to be provided other than those already provided in the financial statements.
b. Information about geographical areas
The geographical information analyses the Company's revenues by the Company's country of domicile (i.e. India) and other countries. In presenting the geographical information, segment revenue has been based on the geographic location of customers. The following is the distribution of the Company's consolidated revenues and receivables by geographical market, regardless of where the goods were produced:
iii) Non-current assets
There are no non-current assets outside India.
c. Information about major customers
Revenue from two customer of the Company has covered more than 10% of total turnover. The name of the customer is KKOC C407.60 million (31 March 2023 : C347.05) and Online flipkart C 187.71 (31 March 2023 : C323.49) respectively, constitute more than 10% of the total revenue of Company.
Note 33 - Employee benefits a. Defined contribution plans
The Company makes contributions, determined as a specified percentage of employee salaries, towards Provident Fund and Employee State Insurance Scheme ('ESI') which are collectively defined as defined contribution plans. The Company has no obligations other than to make the specified contributions. The contributions are charged to the Statement of Profit and Loss as they accrue. The amount recognized as an expense towards contribution to Provident Fund and ESI are as follows:
b. Defined benefit plans Gratuity
The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the Act, employees who have completed five years of service are entitled to specific benefit. The level of benefit provided depends on the member's length of service and salary retirement age. The employee is entitled to a benefit equivalent to 15 days salary last drawn for each completed year of service. The same is payable on termination of service or retirement or death whichever is earlier.
The present value of the obligation under such defined benefit plan is determined based on an actuarial valuation as at the reporting date using the projected unit credit method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligations are measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation under defined benefit plans is based on the market yields on government bonds as at the date of actuarial valuation. Actuarial gains and losses (net of tax) are recognized immediately in the Other Comprehensive Income (OCI).
This is an unfunded benefit plan for qualifying employees. This scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service.
The above defined benefit plan exposes the Company to following risks:
Interest rate risk:
The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.
Salary inflation risk:
Higher than expected increases in salary will increase the defined benefit obligation.
Demographic risk:
This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria.
benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognized in the balance sheet. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.
iv. Actuarial assumptions
(i) Economic assumptions
The principal assumptions are the discount rate and salary growth rate. The discount rate is generally based upon the market yield available on the Government bonds at the accounting date with a term that matches that of the liabilities and the salary growth rate takes account of inflation, seniority, promotion and other relevant factors on long term basis.
The above sensitivity analysis are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same methods (present value of defined
Risk management framework
The Company is exposed to market risk, credit risk and liquidity risk. The Company's senior management oversees the management of these risks. The Company's senior management is responsible to ensure that Company's financial risk activities which are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company's policies and risk objectives. The board of directors reviews and agrees policies for managing each of these risks, which are summarized below.
(i) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises interest rate risk and currency risk financial instruments affected by market risk include trade receivables, borrowings and investments measured at fair value through profit and loss account. The objective of market risk management is to manage and control market risk exposures within acceptable parameters while optimizing the return.
(a) Interest Rate Risk
Interest rate risk is the risk that the fair value or future cash flow of a financial instrument will fluctuate because of change in market interest rates. The Company does not expose to the risk of changes in market interest rates as there are no borrowings.
(b) Currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company's exposure to the risk of changes in foreign exchange rates relates primarily to its operating activities (when certain purchases and trade payables are denominated in a foreign currency).
The Company undertakes transactions denominated in foreign currencies and consequently, exposes to exchange rate fluctuations. The Company does not enter into trade financial instruments including derivate financial instruments for hedging its foreign currency risk. The appropriateness of the risk policy is reviewed periodically with reference to the approved foreign currency risk management policy followed by the Company.
a. The company has elected to measure the investment to subsidiaries at cost. For quoted investment market value is taken as fair value.
b. Fair valuation of the loans and borrowings is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Subsequent measurements of all assets and liabilities is at amortised cost, using effective interest rate (EIR) method.
c. Fair valuation of financial assets and liabilities with short term maturities is considered as approximate to respective carrying amount due to the short term maturities of these instruments.
d. The Company has entered in future and options contract for shares during the current year. These derivative contracts are recognised in other income at FVTPL and all outstanding contracts are marked to market as at year end.
There are no transfers between level 1, level 2 and level 3 during the years presented.
There has been no financial assets or financial liabilities that has been fair valued through OCI.
Sensitivity analysis:
The following table details the Company's sensitivity to a 5% increase and decrease in the INR against relevant foreign currencies. 5% is the rate used in order to determine the sensitivity analysis considering the past trends and expectations of the management for changes in the foreign currency exchange rate. The sensitivity analysis includes the outstanding foreign currency denominated monetary items and adjust their transaction at the year end for 5% change in foreign currency rates. A positive number below indicates a increase in profit or equity where the INR strengthens 5% against the relevant currency.
For a 5% weakening of the INR against the relevant currency, there would be a comparable impact on the profit or equity balance below would be negative. This analysis is performed on foreign currency denominated monetary financial assets and financial liabilities outstanding as at the year end. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases.
(ii) Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount.
(a) Trade receivables
Customer credit risk is managed as per the Company's established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored.
Based on internal assessment which is driven by the historical experience/current facts available in relation to default and delays in collection thereof, the credit risk for trade receivables is considered low. The Company estimates its allowance for trade receivable using lifetime expected credit loss. Individual receivables which are known to be uncollectible are written off by reducing the carrying amount of trade receivable and the amount of the loss is recognized in the Statement of Profit and Loss within other expenses.
(b) Cash and cash equivalents and deposits with banks
Cash and cash equivalents of the Company are held with banks which have high credit rating. The Company considers that its cash and cash equivalents have low credit risk based on the external credit ratings of the counterparties.
(c) Security deposits
The Company furnished security deposits to its lessor for obtaining the premises on lease and margin money deposits to banks. The Company considers that its deposits have low credit risk or negligible risk of default as the parties are well established entities and have strong capacity to meet the obligations. Also, where the Company expects that there is an uncertainty in the recovery of deposit, it provides for suitable impairment on the same.
(d) Other financials assets
These asset are consider to be low credit risk as these parties / banks are well established entities and have strong capacity to meet the obligations.
(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 objective is to, at all times maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company closely monitors its liquidity position. The Company has maintained fixed deposit and made investment in mutual fund to address any liquidity requirement and continue as a going concern.
(iv) Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Company's performance to developments affecting a particular industry. The Company has significant business through online market place portal and few distributors.(refer note 32C for sale to major parties)
Note - 40 Other statutory information
Note 38- Capital risk management (i) Risk Management
For the purpose of the Company's capital management, capital includes issued equity capital, and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company's capital management is to maximize the shareholder value.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions, business strategies and future commitments. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, trade payables and borrowings, less cash and cash equivalents.
In order to achieve this overall objective, the Company's capital management, amongst other things, aims to maintain investor, creditor and market confidence and to sustain future development of the business.
(ii) Dividend not recognised at the end of the year
Subsequent to the year end, the Board of Directors has not recommended payment of final dividend for the financial year ended 31 March 2024.
|
Note 39- Contingent liabilities and commitments (to the extent not provided for) (a) Claims against Company not acknowledged as debts
|
|
|
|
Particulars
|
As at 31 March 2024
|
As at 31 March 2023
|
|
Income tax matters
|
|
0.21
|
0.21
|
(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 does not have any transactions with companies struck off in current financial year.
(iii) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.
(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
(v) 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
(vi) 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
(vii) The Company has not 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
(viii) The Company has borrowings for vehicle loan from bank and there is no requirement to file the quarterly current asset stock statement with bank.
(ix) None of the entities in the Company have been declared wilful defaulter by any bank or financial institution or government or any government authority.
(x) The Company has complied with the number of layers prescribed under the Companies Act, 2013.
(xi) The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.
(xii) The Company including the "Companies in the Group" (as per the provisions of the Core Investment Companies (Reserve Bank) Directions, 2016) do not have any Core Investment Company ("CIC")
No tax expense has been accrued in financial statements for the tax demand raised. The Company is contesting the demand and the management believes that the ultimate outcome of the proceeding will not have a material adverse effect on the company's financial position and results of operations.
The Company has lodge certain civil cases against other parties including distributors and believe that the ultimate outcome of the proceeding will not have a material adverse effect on the company's financial position and results of operations of the Company.
# Pursuant to judgement by the Hon'ble Supreme Court dated 28 February 2019, it was held that basic wages for the purpose of provident fund, to include special allowances which are common for all employees. However there is uncertainty with respect to the applicable of the judgement and period from which the same applies. The Company has estimated the impact of the same from post 28 February 2019 and recognized in the financial statement. Owing to the aforesaid uncertainty and pending clarification from the authority in this regard, the Company has not recognized any provision for the period prior to date of judgement. Further management also believes that the impact of the same on the Company will not be material.
Note 42-Code on Social Security
The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published.
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