(n) Provisions, Contingent Liabilities and Contingent Assets
(i) Provisions
Provisions are recognized when, based on the Company's present obligation (legal or constructive) as a result of a past event,
it is probable that the Company will be required to settle the obligation and a reliable estimate can be made of the amount of
the obligation.
The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the
end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is
measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash
flows (when the effect of the time value of money is material).
(ii) Contingent Liabilities and Assets
Show-cause notices issued by various Government Authorities are generally not considered as obligations. When the
demand notices are raised against such show cause notices and are disputed by the Company, these are classified as disputed
obligations.
The treatment in respect of disputed obligations are as under:
a) a provision is recognized in respect of present obligations where the outflow of resources is probable;
b) all other cases are disclosed as contingent liabilities unless the possibility of outflow of resources is remote.
Contingent liabilities are possible obligations that arise from past events and whose existence will only be confirmed by the
occurrence or non-occurrence of one or more future events not wholly within the control of the Company. Where it is not
probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation
is disclosed as a contingent liability. Contingent liabilities are disclosed on the basis of judgment of the
management/independent experts and reviewed at each balance sheet date to reflect the current management estimate.
Contingent assets are disclosed in the Financial Statements by way of notes to accounts when an inflow of economic
benefits is probable.
(o) Statement of Cash Flow
Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non¬
cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses
associated with investing or financing cash flows. The cash flows are segregated into operating, investing and financing activities.
(p) Segment Reporting
The Company identifies primary segments based on the dominant source, nature of risks and returns and the internal
organisation and management structure. The operating segments are the segments for which separate financial information is
available and for which operating profit / loss amounts are evaluated regularly by the Chief Operating Decision Making Body
(CODM) in deciding how to allocate resources and in assessing performance.
The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.
(q) Exceptional items
An ordinary item of income or expense which by its size, nature, occurrence or incidence requires a disclosure in order to improve
understanding of the performance of the Company is treated as an exceptional item in the Statement of Profit and Loss account.
4 Critical Accounting Judgments, Estimates, Assumptions and Key Sources of Estimation Uncertainty
The preparation of the Company's financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of
contingent liabilities at the date of the financial statements. Estimates and assumptions are continuously evaluated and are based on
management's experience and other factors, including expectations of future events that are believed to be reasonable under the
circumstances. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to
the carrying amount of assets or liabilities affected in future periods.
(a) Judgements
In the process of applying the Company's accounting policies, management has made the following judgements, which have the
most significant effect on the amounts recognized in the financial statements:
Evaluation of Indicators for Impairment of Property, Plant and Equipment
The evaluation of applicability of indicators of impairment of assets requires assessment of external factors (significant decline
asset's value, significant changes in the technological, market, economic or legal environment, market interest rates etc.) and
internal factors (obsolescence or physical damage of an asset, poor economic performance of the asset etc.) which could result in
significant change in recoverable amount of the Property, Plant and Equipment.
(b) Assumptions and Estimation Uncertainties
Information about estimates and assumptions that have the significant effect on recognition and measurement of assets,
liabilities, income and expenses is provided below. Actual results may differ from these estimates.
i) Defined Benefit Obligations
The cost of the defined benefit gratuity plan, the present value of the gratuity obligation and compensated absences are
determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual
developments in the future. These include the determination of the discount rate, future salary increases and mortality rates.
Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to
changes in these assumptions. All assumptions are reviewed at each reporting date.
The parameter most subject to change is the discount rate. In determining the appropriate discount rate, the management
considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit
obligation. The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables
tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based
on expected future inflation rates for the respective countries.
ii) Useful lives of Property, Plant and Equipment/Intangible Assets
Property, Plant and Equipment/ Intangible Assets are depreciated/amortised over their estimated useful lives, after taking into
account estimated residual value. The useful lives and residual values are based on the Company's historical experience with
similar assets and taking into account anticipated technological changes or commercial obsolescence. Management reviews
the estimated useful lives and residual values of the assets annually in order to determine the amount of
depreciation/amortisation to be recorded during any reporting period. The depreciation/amortisation for future periods is
revised, if there are significant changes from previous estimates and accordingly, the unamortised/depreciable amount is
charged over the remaining useful life of the assets.
iii) Contingent Liabilities
In the normal course of business, Contingent Liabilities may arise from litigation and other claims against the Company.
Potential liabilities that are possible but not probable of crystallising or are very difficult to quantify reliably are treated as
contingent liabilities. Such liabilities are disclosed in the Notes but are not recognised. Potential liabilities that are remote are
neither recognised nor disclosed as contingent liability. The management decides whether the matters need to be classified
as 'remote', 'possible' or 'probable' based on expert advice, past judgements, experiences etc.
iv) Evaluation of Indicators for Impairment of Property, Plant and Equipment
The evaluation of applicability of indicators of impairment of assets requires assessment of external factors (significant decline
in asset's value, economic or legal environment, market interest rates etc.) and internal factors (obsolescence or physical
damage of an asset, poor economic performance of the idle assets etc.) which could result in significant change in recoverable
amount of the Property, Plant and Equipment and such assessment is based on estimates, future plans as envisaged by
Company.
v) Allowance for impairment of trade receivables
The expected credit loss is mainly based on the ageing of the receivable balances and historical experience. The receivables
are assessed on an individual basis or assessed for impairment collectively, depending on their significance. Moreover, trade
receivables are written off on a case-to-case basis if deemed not to be collectible on the assessment of the underlying facts
and circumstances.
vi) Provisions
Provisions and liabilities are recognised in the period when it becomes probable that there will be a future outflow of funds
resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition
and quantification of the liability requires the application of judgement to existing facts and circumstances, which can be
subject to change. The carrying amounts of provisions and liabilities are reviewed regularly and revised to take account of
changing facts and circumstances.
vii) Revenue Recognition
The Company's contracts with customers include promises to transfer products and service to the customers. The Company
assesses the products and service promised in a contract and identifies distinct performance obligations, if any, in the
contract. Identification of distinct performance obligation involves judgement to determine the deliverables and the ability of
the customer to benefit independently from such deliverables. Judgement is also required to determine the transaction price
for the contract. The Company exercises judgement in determining whether the performance obligation is satisfied at a point
in time or over time. The Company considers indicators such as to who controls the asset as it is being created or existence of
enforceable right to payment for performance to date and alternate use of such product, bill and hold agreements, transfer of
significant risks and rewards to the customer, acceptance of delivery by the customer, etc. The judgment is also exercised in
determining the variable consideration, if any, involved in transaction price.
6(b) The Company has investment of '409.80 Lakhs in 1,90,500 equity shares and deemed equity of '45.13 Lakhs of its wholly owned
subsidiary Savas Engineering Private Limited (SEPL). The Company has outstanding balance of payable is '522.14 Lakhs as on March
31,2025. As on 31st March 2025, outstanding balance for capital advance is '1,400.00 Lakhs for procurement of capital goods under
proposed expansion plan at Changodar plant. The company has carried out impairment testing on its investment based on book
values of net assets as at 31st March 2025 of SEPL and accordingly, the impairment provided ('307.32 Lakhs) in the earlier years has
been reversed during the year due to improvement in financial position of SEPL.
6(c) During the year, the Company has additionally acquired 8,40,760 equity shares and have paid the purchase consideration of
$1 which is equivalent to '87 to acquire such additional shares. Consequently, with effect from February 03, 2025, the said subsidiary
became a wholly-owned subsidiary during the year. Total investment in TARIL Switchgrear Private Limited (TSPL) is '17.11 Lakhs (PY.
17.11 Lakhs).The company has carried out impairment testing on its investment based on book values of net assets as at 31st March
2025 of TSPL and accordingly, the impairment provided ('17.11 Lakhs) inearlier years has been reversed due to improvement in
financial position ofTSPL.
6(d) During the year, the Company has acquired 1,37,70,000 equity shares representing 51.00% of the equity share capital of Triveni
Transtech (India) Private Limited (formerly known as Posco Poggenamp Electrical Steel Private Limited) ("Triveni") for cash
consideration of '1,281 Lakhs (@ '9.30 per share), pursuant to which, the Company has obtained control over Triveni with effect from
January 28, 2025 ("acquisition date").
6(e) The amount of '31.62 Lakhs (PY. '31.62 Lakhs) shown as deemed equity investments denotes the fair value of financial guarantee
given for Transpares Limited without any consideration.
19(d) Right, Preferences and restrictions attached to Equity Shares
The company has only one class of equity shares having a par value of '1 per share. Each shareholder is eligible for one vote per
share held. The final dividend, whenever proposed by the Board of Directors is subject to approval of the shareholders in ensuing
Annual General Meeting, except in case of interim dividend. In the event of liquidation of the Company, the equity share holders
are eligible to receive the residual assets of the Company after distribution of all preferential amounts, in proportion to their
shareholding.
19(e) Shares issued for consideration other than cash:
The Company has issued 15,00,82,917 bonus shares of face value of '1 each during the year in the ratio of 1 bonus share for every
1 share held from out of Securities Premium Reserve in terms of the approval by shareholders in their Extra Ordinary General
meeting held on February 03, 2025.
19 (f) During the year, the Company increaded the paid up capital by '49,999.99 Lakhs through Qualified Institutions Placement of
equity shares. The Allotment Committee of the Board of Directors of the Company, at its meeting held on June 14, 2024, approved
the allotment of 75,18,796 Equity Shares of face value '1 each to eligible investors at a price '665 per equity share including
premium of '664 per equity share.
19 (g) The Company had allotted 1,00,00,011 Equity Shares on 13th October,2023 at a price of '120/- per Equity Share (at premium of
'119 per Equity Share) by way of a preferential issue on a private placement basis after shareholder approval at Extra-Ordinary
General Meeting held on 6th October, 2023 and In-Principal approval of Both Stock Exchanges i.e BSE Limited and National Stock
Exchange of India Limited received as on 12th October, 2023.
44 Employee Benefit Plans
In accordance with the stipulations of the Indian Accounting Standard 19 “Employee Benefits", the disclosures of employee benefits
as defined in the Indian Accounting Standard are given below:
(a) Defined Contribution Plan
The Company has recognized an amount of '134.05 Lakhs (P.Y. '202.02 Lakhs) as expenses under the defined contribution plan
in the Statement of Profit and Loss.
(b) Defined Benefit Plan
Gratuity
General description and benefits of the plan
Under the gratuity plan, the eligible employees are entitled to post retirement benefit at the rate of 15 days salary for each
completed year of service. Vesting period is 5 years and the payment is at actual on superannuation, resignation, termination,
disablement or on death. The liability for gratuity as above is recognized on the basis of actuarial valuation.
The Company makes contribution to Life Insurance Corporation (LIC) and India First Life Insurance for gratuity benefits according
to the Payment of Gratuity Act, 1972.
The Company recognizes the liability towards the gratuity at each Balance Sheet date.
The most recent actuarial valuation of the defined benefit obligation for gratuity was carried out at 31st March 2025 by an actuary.
The present value of the defined benefit obligations and the related current service cost and past service cost, were measured
using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of benefit
entitlement and measures each unit separately to build up the final obligation. Scheme is funded through LIC, Canara Bank and
India First.
Major Risks to the Plan
(i) Actuarial Risk
It is the risk that benefits will come more than expected. This can arise due to one of the following reasons:
Salary hikes that are higher than the assumed salary escalation will result into an increase in Obligation at a rate that is higher than
expected.
Actual Mortality rates are higher than assumed mortality rate assumption than the Gratuity benefits will be paid earlier than
expected. Since there is no condition of vesting on the death benefit, the acceleration of Cashflow will lead to an actuarial loss or
gain depending on the relative values of the assumed salary growth and discount rate.
The actual withdrawal rates are higher than assumed withdrawal rate assumption than the Gratuity benefits will be paid earlier
than expected. The impact of this will depend on whether the benefits are vested as at the resignation date.
(ii) Investment Risk
The present value of the defined benefit plan liability is calculated using a discount rate determined by reference to the market
yields on government bonds denominated in Indian Rupees. If the actual return on plan asset is below this rate, it will create a plan
deficit.
(iii) Interest Risk
A decrease in the bond interest rate will increase the plan liability. However, this will be partially offset by an increase in the return
on the plan's debt investments.
(iv) Longevity Risk
The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan
participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the
plan's liability.
(v) Salary Risk
The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such,
an increase in the salary of the plan participants will increase the plan's liability.
(vi) Liquidity Risk
Employees with long duration and high salaries resign earlier than expected or in short span of time there may be liquidity
concern for the Gratuity fund.
(vii) Legislative Risk
Changes benefit formula mentioned in Gratuity Act, especially an increase in upper limit could very significantly increase the
amount of Obligation.
(viii) Market Risk
Discount rates are to be based on the yield on Government bonds with tenures matching the expected payments of Gratuity
Liability. Discount rate will have to be reduced if yields drop and this would result in an increase in Obligation.
The following table sets out the status of the gratuity and the amounts recognized in the Company's financial statements as at
31st March 2024.
(e) The company provides service type warranty to its customers, such type of warranty are considered as distinct service. The
company uses expected value method in measuring the performance obligation. The revenue from contracts with customers for
the year includes service type warranty of '736.36 lakhs (Previous Year '444.40 lakhs), which has been deducted from the
transaction price.
(f) The revenue from contracts with customers for the year includes variable consideration relating to price variation of '8,554.67 lakhs
(Previous Year '8,676.10 lakhs), which has been considered in the transaction price. There were no significant financing component
in the contracts with customers or in revenues recognised from these contracts.
(g) Performance obligations
Sale of Transformers
The performance obligation is satisfied upon delivery of the equipment and payment is generally due within 1 to 3 months from
delivery.
The performance obligation to deliver the transformer with a manufacturing lead time of 4 to 8 months has a single payment
option. The customer can pay the transaction price upon delivery of the transformer within the credit period, as mentioned in the
contract with respective customers.
Services Income
The performance obligation is satisfied at the point in time and payment is generally due upon completion of installation and
acceptance by the customers.
48 Operating Segment
The Company primarily operates in the segment of Manufacturing of Transformers. The Chairman and Wholetime Director/
Managing Director of the Company allocate resources and assess the performance of the Company, thus are the Chief Operating
Decision Maker (CODM). The CODM monitors the operating results of the business as a one, hence no separate segment need to
be disclosed.
All non current assets are located in the company's country of domicile.
One customer contributed 10% or more to the company's revenue for FY 2024-25 amounting to '64964.55 lakhs and one
customer contributed 10% or more to the company's revenue for FY 2023-24 amounting to '14200.42 lakhs.
Fair Value of financial assets and liabilities that are not measured at fair value (but fair value disclosures are required)
Management considers that the carrying amounts of financial assets and financial liabilities recognized in the financial statements
approximate their fair values.
Level 1 - Quoted market prices in active market for identical assets or Liabilities.
Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly
observable.
Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
(iii) Financial Risk Management Objectives
While ensuring liquidity is sufficient to meet Company's operational requirements, the Company's Board of Directors also monitors
and manages key financial risks relating to the operations of the Company by analysing exposures by degree and magnitude of
risks. These risks include market risk (including currency risk and price risk), credit risk and liquidity risk.
Market Risk
Market risk is the risk of uncertainty arising from possible market price movements and their impact on the future performance of a
business. The major components of market risk are commodity price risk, foreign currency risk and interest rate risk.
The primary commodity price risk that the company is exposed to include the price variations in the price of Copper and Cold
Rolled Grain Oriented Steel (CRGO). The mentioned components form a major part of manufacturing of Transformers. The prices
of these commodities lead to increase/ decrease in the cost of Transformers.
Foreign Currency Risk Management
The Company undertakes transactions denominated in different foreign currencies and consequently exposed to exchange rate
fluctuations. Exchange rate exposures are managed within approved policy parameters.
Sensitivity to risk
A 5% strengthening of the INR against key currencies to which the Company is exposed would have led to approximately an additional
'316.12 Lakhs gain in the Statement of Profit and Loss. A 5% weakening of the INR against these currencies would have led to an equal but
opposite effect of '316.12 Lakhs.
Interest Rate Risk
It 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's debt obligations with floating
interest rates.
Price Risk
The Company has deployed its surplus funds into units of mutual fund. The Company is exposed to NAV (net asset value) price risks
arising from investments in these funds. The value of these investments is impacted by movements in liquidity and credit quality of
underlying securities.
NAV price sensitivity analysis
The Sensitivity analyses below have been determined based on the exposure to NAV price risks at the end of the reporting period. If NAV
prices had been 1% higher/lower:
Profit for the year ended 31st March 2025 would increase/decrease by '237.75 Lakhs (Previous Year '25.00 Lakhs).
Liquidity Risk
The Company manages liquidity risk by maintaining sufficient cash and cash equivalents and availability of funding through an adequate
amount of committed credit facilities to meet the obligations when due. Management monitors rolling forecasts of liquidity position and
cash and cash equivalents on the basis of expected cash flows. In addition, liquidity management also involves projecting cash flows
considering level of liquid assets necessary to meet obligations by matching the maturity profiles of financial assets & liabilities and
monitoring balance sheet liquidity ratios.
The following tables detail the Company's remaining contractual maturity for its non-derivative financial liabilities with agreed repayment
periods. The information included in the tables have been drawn up based on the undiscounted cash flows of financial liabilities based on
the earliest date on which the Company may be required to pay. The tables include both interest and principal cash flows. The contractual
maturity is based on the earliest date on which the Company may be required to pay.
Credit Risk
The Company's customer profile include Government Companies and Industries. Accordingly, the Company's customer credit risk is
moderate. The Company has a detailed review mechanism of overdue customer receivables at various levels within organization to ensure
proper attention and focus for realization.
An impairment analysis is performed at each reporting date on an individual basis for major customers. In addition, a large number of
minor receivables are grouped into homogenous groups and assessed for impairment collectively. The Company applies Simplified
approach for providing the expected credit losses on Trade Receivables as per the accounting policy of the company.
52 The borrowing cost capitalised [net of income of '26.53 Lakhs (previous year ' Nil) from temporary deployment of borrowed funds]
during the year is '302.89 Lakhs (previous year ' Nil).
The capitalisation rate used to determine the amount of borrowing costs eligible for capitalisation is 9.5%
53 Relationship with Struck off Companies
The Company has not carried out any transactions with companies struck off under Section 248 of the Companies Act, 2013 or
Section 560 of the Companies Act, 1956. There is no outstanding balance as at 31st March 2025 in case of said struck off company.
54 Compliance with number of layers of companies:
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
55 Compliance with approved Scheme(s) of Arrangements
The Company has not applied for any Scheme of Arrangements under Sections 230 to 237 of the Companies Act, 2013.
56 The Company do not have any Benami property, where any proceeding has been initiated or pending against the Group for
holding any Benami property.
57 Utilisation of Borrowed funds and share premium
Details of Funds advanced or loaned or invested by Company
The Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind
of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded
in writing or otherwise) that the Intermediary shall
(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
company (Ultimate Beneficiaries) or
(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries;
58 Details of funds received by Company
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
(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
Funding Party (Ultimate Beneficiaries) or
(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
59 Undisclosed Income
During the year under consideration, no tax assessment under the Income Tax Act, 1961 (such as, search or survey or any other
relevant provisions of the Income Tax Act, 1961) has been initiated/ongoing by the Income Tax Department.
60 Wilful Defaulter
The Company is not declared as wilful defaulter (as defined under the Companies Act, 2013) by any Bank or Financial Institution or
other lender.
62 The Company has assessed internal and external information upto the date of approval of these audited financial results while
reviewing the recoverability of assets, adequacy of financial resources, performance of contractual obligations, ability to service the
debt & liabilities, etc. Based on such assessment, the company expects to fully recover the carrying amounts of the assets and
comfortably discharge its debts & obligations. Hence, the management does not envisage any material impact on the Audited
standalone financial results of the company for the quarter and year ended March 31,2025.
63 Fig ures of corresponding previous year have been regrouped /rearranged wherever necessary, to make them comparable.
64 The Standalone Financial Statements were approved for issue by the Board of Directors on 8th April, 2025.
As per our report of even date attached For and on behalf of the Board
For, Manubhai & Shah LLP Satyen J. Mamtora Jitendra U. Mamtora
Chartered Accountants Managing Director Chairman and Whole Time Director
ICAI Firm Reg. No.: 106041W/W100136 (DIN : 00139984) (DIN :00139911)
K. B. Solanki Rakesh Kiri Chanchal Singh Satyendra Rajora
Partner Company Secretary Chief Financial Officer &
Membership No. 110299 Advisor to the Board
Place: Ahmedabad Place: Ahmedabad
Date: 08 th April, 2025 Date: 08 th April, 2025
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