FUTURE DLF Notes to Accounts

1. NATURE OF PRINCIPAL ACTIVITIES


DLF Limited (‘the Company’) is engaged primarily in the business of colonisation and real estate development. The operations of the Company span all aspects of real estate development, from the identification and acquisition of land, to planning, execution, construction and marketing of projects. The Company is also engaged in the business of leasing, maintenance services and recreational activities which are related to the overall development of real estate business. The Company is domiciled in India and its registered office is situated at Shopping Mall, 3rd Floor, Arjun Marg, Phase I, DLF City, Gurugram - 122 002, Haryana.


2. GENERAL INFORMATION AND STATEMENT OF COMPLIANCE WITH IND AS


These standalone financial statements (‘financial statements’) of the Company have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the ‘Ind AS’) as notified by Ministry of Corporate Affairs (‘MCA’) under Section 133 of the Companies Act, 2013 (‘the Act’) read with the Companies (Indian Accounting Standards) Rules, 2015, as amended and other relevant provisions of the Act. The Company has uniformly applied the accounting policies during the periods presented.


These financial statements for the year ended 31 March 2017 are the first financial statements which the Company has prepared in accordance with Ind AS. For all periods up to and including the year ended 31 March 2016, the Company had prepared its financial statements in accordance with accounting standards notified under Section 133 of the Act, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Previous GAAP), which have been adjusted for the differences in the accounting principles adopted by the Company on transition to Ind AS. For the purpose of comparatives, financial statements for the year ended 31 March 2016 and opening balance sheet as at 1 April 2015 are also prepared as per Ind AS.


The financial statements for the year ended 31 March 2017 were authorized and approved for issue by the Board of Directors on 26 May 2017.


3. BASIS OF PREPARATION


The financial statements have been prepared on going concern basis in accordance with accounting principles generally accepted in India. Further, the financial statements have been prepared on historical cost basis except for certain financial assets and financial liabilities and share based payments which are measured at fair values as explained in relevant accounting policies.


4. RECENT ACCOUNTING PRONOUNCEMENT


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 flow’ and Ind AS 102, ‘Share-based payment.’ The amendments are applicable to the Company from 1 April 2017.


Amendment to Ind AS 1


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 its impact on the financial statements. Amendment to Ind AS 102


The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of cash-settled awards and awards that include a net settlement feature in respect of withholding taxes. It clarifies that the fair value of cash-settled awards is determined on a basis consistent with that used for equity-settled awards. Market-based performance conditions and non-vesting conditions are reflected in the ‘fair values’, but non-market performance conditions and service vesting conditions are reflected in the estimate of the number of awards expected to vest. Also, the amendment clarifies that if the terms and conditions of a cash-settled share-based payment transaction are modified with the result that it becomes an equity-settled share-based payment transaction, the transaction is accounted for as such from the date of the modification. Further, the amendment requires the award that includes a net settlement feature in respect of withholding taxes to be treated as equity-settled in its entirety. The cash payment to the tax authority is treated as if it was part of an equity settlement. The Company is evaluating the requirements of the amendment and its impact on the financial statements.


The changes in the carrying value of investment properties for the year ended 31 March 2017 are as follows:


(i) Contractual obligations


Refer note 53(II) for disclosure of contractual commitments for the acquisition of investment properties.


(ii) Capitalised borrowing cost


The borrowing costs capitalised during the year ended 31 March 2017 was Rs.521.54 lakhs (31 March 2016: Rs.9,958.75 lakhs and 1 April 2015: Rs.12,830.07 lakhs).


(iii) Amount recognized in statement of profit and loss for investment properties


(iv) Leasing arrangements


Certain investment properties are leased to tenants under long-term operating leases with rentals payable monthly. Refer note 51 for details on future minimum lease rentals.


(v) Fair value


Fair value hierarchy and valuation technique


The fair value of investment property has been determined by external, independent property valuers, having appropriate recognized professional qualification and recent experience in the location and category of the property being valued. The Company obtains independent valuations for its investment properties annually and fair value measurement has been categorised as Level 3. Fair values for some of the properties are arrived using average of fair values calculated basis discounted cash flow and sales comparable method. Further, for other properties the Company has used rent capitalisation and comparable market rate approach to arrive at fair value. In addition to this, the Company (“Developer’’) has a land parcels which is notified Special Economic Zone (“SEZ”) and classified under investment property. The Developer has partially developed the SEZ under the co-development agreement between the Company and DLF Assets Private Limited (“DAPL” or “the Co-developer”), one of the subsidiary company and transferred completed bare shell buildings to DAPL. Remaining portion of such land is under development. As per the co-developer agreement, the land underneath the buildings has been given on long-term lease to DAPL. The management has assessed that the value of such SEZ land classified under investment property, based on the prevailing circle rates, is higher than the book value. However, given the above arrangement and restriction on sale of land in a SEZ as prescribed under SEZ Rules 2006, the management considered carrying value aggregating Rs.13,214.25 lakhs (31 March 2016: Rs.13,214.25 lakhs and 1 April 2015: Rs.13,214.25 lakhs) to be a reasonable estimate of its fair value.


Disclosure on Specified Bank Notes (SBNs)


During the year, the Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(E) dated 31 March 2017 on the details of Specified Bank Notes (SBNs) held and transacted during the period from 8 November 2016 to 30 December 2016, the denomination wise SBNs and other notes as per the notification is given below:


The Company does not maintain details of denomination of currency received and paid in its books of account. The above disclosure has been compiled on the basis of total cash collected and paid as per the books of account and denomination wise details of cash deposited in the bank, available from pay-in slips and other information maintained by the Company.


* For the purposes of this clause, the term ‘Specified Bank Notes’ shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated the 8 November 2016.


^ Inclusive of the imprest lying with employees.


Note:


(i) Rs.6,448.30 lakhs (31 March 2016: Rs.6,682.83 lakhs and 1 April 2015: Rs.27.94 lakhs) represents restricted deposits, as these are pledged in lieu of the ongoing legal cases against the Company.


(ii) The bank balances include the margin money amounting to Rs.1,476.32 lakhs (31 March 2016: Rs.1,378.77 lakhs and 1 April 2015: Rs.2,650.00 lakhs) against the bank borrowings.


a) Rights/preferences/restrictions attached to equity shares


“The Company has only one class of equity shares having a par value of Rs.2 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees.


In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.


During the year ended 31 March 2017, no dividend has been recognized as distributions to equity shareholders (31 March 2016: final dividend Rs.2 per share and interim dividend Rs.2 per share).”


b) Aggregate number of shares issued for consideration other than cash and shares bought back during the period of five years immediately preceding the date 31 March 2017


i) Shares bought back during the financial year 2012-13 to 2016-17


Nil (during FY 2011-12 to 2015-16: Nil ) equity shares of Rs.2 each bought back pursuant to Section 68, 69 and 80 of the Act.


ii) Shares issued under Employees Stock Option Plan (ESOP) during the financial year 2012-13 to 2016-17


The Company has issued total 4,598,954 equity shares of Rs.2 each (during FY 2011-12 to 2015-16: 5,125,871 equity shares) during the period of five years immediately preceding 31 March 2017 on exercise of options granted under the Employee Stock Option Plan (ESOP).


c) Shares reserved for issue under options


For details of shares reserved for issue under the Employee Stock Option Plan (ESOP) of the Company, refer note 52.


Nature and purpose of reserves Capital reserve


Capital reserve was created under the previous GAAP out of the profit earned from a specific transaction of capital nature. Capital reserve is not available for the distribution to the shareholders.


Capital redemption reserve


The same has been created in accordance with provision of the Act for the buy back of equity shares from the market.


Securities premium reserve


Securities premium reserve is used to record the premium on issue of shares. The reserve will be utilised in accordance with provisions of the Act. General reserve


The Company is required to create a general reserve out of the profits when the Company declares dividend to shareholders.


Share options outstanding account


The reserve is used to recognize the grant date fair value of the options issued to employees under Company’s Employee Stock Option Plan. Forfeiture of shares


This reserve was created on forfeiture of shares by the Company. The reserve is not available for the distribution to the shareholders. Debenture redemption reserve


The Company is required to create a debenture redemption reserve out of the profits which are available for redemption of debentures.


5.1. Repayment terms and security disclosure for the outstanding long-term borrowings (excluding current maturities) as at 31 March 2017: Listed, Secured, Redeemable, Non-Convertible Debentures of Rs.50,000,000 each referred above to the extent of:


(i) Rs.24,607.56 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 11 August 2020.


(ii) Rs.9,377.63 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 11 August 2020.


(iii) Rs.24,725.07 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 9 August 2019.


(iv) Rs.9,414.29 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 9 August 2019.


(v) Rs.24,841.30 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 10 August 2018.


(vi) Rs.9,450.52 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 10 August 2018.


(vii) Rs.6,237.14 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.50% and date of final redemption is 30 April 2018.


From banks: Secured foreign currency borrowings:


(a) Facility of Rs.157,556.02 lakhs, balance amount is repayable in 14 quarterly installments starting from April 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at New Delhi, owned by subsidiary company.


(ii) Pledge over the shareholding of subsidiary company owning the aforesaid immovable property.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


From banks: Secured INR borrowings:


(a) Facility of Rs.8,616.44 lakhs, balance amount is repayable in 6 quarterly installments starting from June 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.5,953.94 lakhs, balance amount is repayable in 2 half yearly installments starting from September 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Kolkata, owned by the Company.


(c) Facility of Rs.9,675.01 lakhs, balance amount is repayable in 8 quarterly installments starting from June 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by the Company.


(d) Facility of Rs.8,179.56 lakhs, balance amount is repayable in 14 monthly installments starting from April 2018.


(e) Facility of Rs.6,355.14 lakhs, balance amount is repayable in 18 monthly installments starting from April 2018.


The aforesaid loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram and Chennai, owned by the subsidiary and group companies.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the subsidiary companies.


(f) Facility of Rs.4,529.90 lakhs, balance amount is repayable in 84 monthly installments starting from April 2018.


(g) Facility of Rs.22,581.00 lakhs, balance amount is repayable in 84 monthly installments starting from April 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by the Company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company.


(h) Facility of Rs.43,241.84 lakhs, balance amount is repayable in 31 monthly installments starting from April 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Kolkata, Lucknow, Mullanpur and New Delhi, owned by the Company/ subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidiary companies.


(iii) Corporate guarantees provided by the subsidiary companies owning the aforesaid immovable properties.


From others:


Secured INR borrowings:


(a) Facility of Rs.2,500.00 lakhs, balance amount is repayable in 6 quarterly installments starting from June 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.16,981.48 lakhs, balance amount is repayable in 6 quarterly installments starting from May 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(c) Facility of Rs.12,475.45 lakhs, balance amount is repayable in 5 monthly installments starting from April 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, Hyderabad and Chennai, owned by company/subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable property at Gurugram, owned by the Company.


(d) Facility of Rs.10,875.43 lakhs, balance amount is repayable in 61 monthly installments starting from April 2018.


(e) Facility of Rs.11,515.16 lakhs, balance amount is repayable in 61 monthly installments starting from April 2018.


(f) Facility of Rs.12,794.62 lakhs, balance amount is repayable in 61 monthly installments starting from April 2018.


The aforesaid term loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Negative lien on rights under the concession agreements pertaining to certain immovable properties situated at New Delhi.


(iii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidiary company.


(iv) Corporate guarantees provided by the subsidiary company owning the aforesaid immovable property.


(g) Facility of Rs.17,163.29 lakhs, balance amount is repayable in 18 monthly installments starting from May 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Kolkata, owned by the Company.


(ii) Charge on receivables of the aforesaid immovable property owned by the Company.


(h) Facility of Rs.7,411.61 lakhs, balance amount is repayable in 18 monthly installments starting from May 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by the Company/ subsidiary company.


(ii) Charge on receivables of the aforesaid immovable property owned by the Company/ subsidiary company.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(i) Facility of Rs.8,902.89 lakhs, balance amount is repayable in 31 monthly installments starting from April 2018. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Kolkata, Lucknow, Mullanpur and New Delhi, owned by the Company/ subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidiary companies.


(iii) Corporate guarantees provided by the subsidiary companies owning the aforesaid immovable properties.


5.2. Repayment terms and security disclosure for the outstanding long-term borrowings (excluding current maturities) as at 31 March 2016: Listed, Secured, Redeemable, Non-Convertible Debentures of Rs.50,000,000 each referred above to the extent of:


(i) Rs.24,491.00 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 11 August 2020.


(ii) Rs.9,341.31 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 11 August 2020.


(iii) Rs.9,377.94 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 9 August 2019.


(iv) Rs.24,608.51 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 9 August 2019.


(v) Rs.12,317.68 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.50% and repayment in 2 equal annual installments starting from 30 April 2017 and date of final redemption is 30 April 2018.


(vi) Rs.9,414.19 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 10 August 2018.


(vii) Rs.24,724.74 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 10 August 2018.


(viii) Rs.8,953.03 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 11 August 2017.


(ix) Rs.24,840.99 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.25% and date of final redemption is 11 August 2017.


From banks:


Secured foreign currency borrowings:


(a) Facility of Rs.177,169.93 lakhs, balance amount is repayable in 18 quarterly installments starting from April 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by subsidiary company.


(ii) Pledge over the shareholding of subsidiary company owning the aforesaid immovable property.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


From banks:


Secured INR borrowings:


(a) Facility of Rs.14,233.62 lakhs, balance amount is repayable in 10 quarterly installments starting from June 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.11,846.53 lakhs, balance amount is repayable in 4 half yearly installments starting from June 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Kolkata, owned by the Company.


(c) Facility of Rs.14,317.76 lakhs, balance amount is repayable in 12 quarterly installments starting from June 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by the Company.


(d) Facility of Rs.2,658.10 lakhs, balance amount is repayable in 2 equal quarterly installments starting from May 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(e) Facility of Rs.328.40 lakhs, balance amount is repayable in the last monthly installment due on April 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(f) Facility of Rs.4,052.96 lakhs, balance amount is repayable in 48 equal monthly installments starting from April 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(g) Facility of Rs.19,964.68 lakhs, balance amount is repayable in 32 monthly installments starting from April 2017.


(h) Facility of Rs.8,454.36 lakhs, balance amount is repayable in 25 monthly installments starting from April 2017.


The aforesaid loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram and Chennai, owned by the subsidiary and group companies.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the subsidiary companies.


(i) Facility of Rs.4,515.84 lakhs, balance amount is repayable in 96 monthly installments starting from April 2017.


(j) Facility of Rs.23,915.00 lakhs, balance amount is repayable in 97 monthly installments starting from April 2017.


The loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by the Company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company.


(k) Facility of Rs.63,524.86 lakhs, balance amount is repayable in 43 monthly installments starting from April 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Kolkata, Lucknow, Mullanpur and New Delhi, owned by the Company/ subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidiary companies.


(iii) Corporate guarantees provided by the subsidiary companies owning the aforesaid immovable properties.


From others: Secured INR borrowings:


(a) Facility of Rs.4,166.67 lakhs, balance amount is repayable in 10 quarterly installments starting from June 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.1,500.00 lakhs, balance amount is repayable in 2 equal quarterly installments starting from May 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(c) Facility of Rs.20,956.59 lakhs, balance amount is repayable in 10 quarterly installments starting from May 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(d) Facility of Rs.2,283.43 lakhs, balance amount is repayable in 2 equal monthly installments starting from April 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by a subsidiary company.


(e) Facility of Rs.42,325.06 lakhs, balance amount is repayable in 17 monthly installments starting from April 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, Hyderabad and Chennai, owned by the Company/ subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable property at Gurugram, owned by the Company.


(f) Facility of Rs.16,177.66 lakhs, balance amount is repayable in 73 monthly installments starting from April 2017.


(g) Facility of Rs.6,912.64 lakhs, balance amount is repayable in 78 monthly installments starting from April 2017.


(h) Facility of Rs.4,693.33 lakhs, balance amount is repayable in 80 monthly installments starting from April 2017.


(i) Facility of Rs.3,829.42 lakhs, balance amount is repayable in 80 monthly installments starting from April 2017.


(j) Facility of Rs.2,503.11 lakhs, balance amount is repayable in 80 monthly installments starting from April 2017.


(k) Facility of Rs.2,378.54 lakhs, balance amount is repayable in 78 monthly installments starting from April 2017.


(l) Facility of Rs.909.96 lakhs, balance amount is repayable in 78 monthly installments starting from April 2017.


(m) Facility of Rs.5,432.65 lakhs, balance amount is repayable in 81 monthly installments starting from April 2017.


The aforesaid term loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/ subsidiary companies.


(ii) Negative lien on rights under the concession agreements pertaining to certain immovable properties situated at New Delhi.


(iii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidiary companies.


(iv) Corporate guarantees provided by the subsidiary companies owning the aforesaid immovable properties.


(n) Facility of Rs.5,645.98 lakhs, balance amount is repayable in 72 monthly installments starting from April 2017.


(o) Facility of Rs.5,978.10 lakhs, balance amount is repayable in 72 monthly installments starting from April 2017.


(p) Facility of Rs.6,642.33 lakhs, balance amount is repayable in 72 monthly installments starting from April 2017.


(q) Facility of Rs.8,302.66 lakhs, balance amount is repayable in 72 monthly installments starting from April 2017.


The aforesaid term loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Negative lien on rights under the concession agreements pertaining to certain immovable properties situated at New Delhi.


(iii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidiary company.


(iv) Corporate guarantees provided by the subsidiary company owning the aforesaid immovable property.


(r) Facility of Rs.3,816.53 lakhs, balance amount is repayable in 5 monthly installments starting from April 2017. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company.


(ii) Charge on receivables and other current assets of the aforesaid immovable property owned by the Company.


5.3. Repayment terms and security disclosure for the outstanding long-term borrowings (excluding current maturities) as on 1 April 2015:


Listed, Secured, Redeemable, Non-Convertible Debentures of Rs.50,000,000 each referred above to the extent of:


(i) Rs.18,241.61 lakhs are secured by way of pari-passu charge on the immovable property situated at New Delhi, owned by the subsidiary company. Coupon rate of these debentures is 12.50% and repayment in 3 equal annual installments starting from 30 April 2016 and date of final redemption is 30 April 2018.


From banks: Secured foreign currency borrowings:


(a) Facility of Rs.173,492.57 lakhs, balance amount is repayable in 22 quarterly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by subsidiary company.


(ii) Pledge over the shareholding of subsidiary company owning the aforesaid immovable property.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


From banks: Secured INR borrowings:


(a) Facility of Rs.16,545.71 lakhs, balance amount is repayable in 12 quarterly installments starting from December 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.17,677.78 lakhs, balance amount is repayable in 6 half yearly installments starting from September 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Kolkata, owned by the Company.


(c) Facility of Rs.18,802.22 lakhs, balance amount is repayable in 16 quarterly installments starting from June 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by the Company.


(d) Facility of Rs.7,921.42 lakhs, balance amount is repayable in 6 equal quarterly installments starting from May 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(e) Facility of Rs.22,775.43 lakhs, balance amount is repayable in 72 equated monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at New Delhi, owned by the Company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company.


(iii) Exclusive charge on immovable property situated at Gurugram, owned by the subsidiary company.


(iv) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(f) Facility of Rs.4,329.20 lakhs, balance amount is repayable in 13 equal monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(g) Facility of Rs.5,046.84 lakhs, balance amount is repayable in 60 equal monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable property owned by the Company.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(h) Facility of Rs.9,722.22 lakhs, balance amount is repayable in 14 equal monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the subsidiary company.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(i) Facility of Rs.1,250.00 lakhs, balance amount is repayable in 3 equal monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the subsidiary company.


(iii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(j) Facility of Rs.23,434.00 lakhs, balance amount is repayable in 12 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable property owned by subsidiary company.


(k) Facility of Rs.24,946.37 lakhs, balance amount is repayable in 21 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by subsidiary company.


(l) Facility of Rs.44,704.54 lakhs, balance amount is repayable in 33 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(m) Facility of Rs.22,526.50 lakhs, balance amount is repayable in 102 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/ subsidiary companies.


(ii) Negative lien on immovable property situated at Gurugram, owned by subsidiary company.


(iii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidiary companies.


(iv) Corporate guarantees provided by the subsidiary companies owning the aforesaid immovable properties.


(n) Facility of Rs.28,681.91 lakhs, balance amount is repayable in 108 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at New Delhi, owned by the Company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company.


From others:


Secured INR borrowings:


(a) Facility of Rs.5,000.00 lakhs, balance amount is repayable in 12 quarterly installments starting from December 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.14,740.26 lakhs, balance amount is repayable in 3 equal annual installments starting from August 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, Hyderabad and Chennai, owned by the Company/ subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable property at Gurugram, owned by the Company.


(c) Facility of Rs.4,500.00 lakhs, balance amount is repayable in 6 equal quarterly installments starting from May 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(d) Facility of Rs.24,926.47 lakhs, balance amount is repayable in 14 quarterly installments starting from May 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable property.


(e) Facility of Rs.16,016.82 lakhs, balance amount is repayable in 14 equal monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by a subsidiary company.


(f) Facility of Rs.30,347.89 lakhs, balance amount is repayable in 64 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable property owned by subsidiary company.


(g) Facility of Rs.51,563.42 lakhs, balance amount is repayable in 21 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by subsidiary company.


(h) Facility of Rs.72,016.76 lakhs, balance amount is repayable in 29 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, Hyderabad and Chennai, owned by the Company/ subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable property at Gurugram, owned by the Company.


(i) Facility of Rs.32,724.54 lakhs, balance amount is repayable in 33 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, Hyderabad and Chennai, owned by the Company/ subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable property at Gurugram, owned by the Company.


(j) Facility of Rs.16,844.71 lakhs, balance amount is repayable in 85 monthly installments starting from April 2016.


(k) Facility of Rs.7,594.67 lakhs, balance amount is repayable in 96 monthly installments starting from April 2016.


(l) Facility of Rs.4,973.72 lakhs, balance amount is repayable in 92 monthly installments starting from April 2016.


(m) Facility of Rs.4,103.66 lakhs, balance amount is repayable in 92 monthly installments starting from April 2016.


(n) Facility of Rs.2,613.22 lakhs, balance amount is repayable in 96 monthly installments starting from April 2016.


(o) Facility of Rs.2,652.65 lakhs, balance amount is repayable in 92 monthly installments starting from April 2016.


(p) Facility of Rs.971.11 lakhs, balance amount is repayable in 92 monthly installments starting from April 2016.


(q) Facility of Rs.5,983.24 lakhs, balance amount is repayable in 99 monthly installments starting from April 2016.


The aforesaid term loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/subsidiary companies.


(ii) Negative lien on rights under the concession agreements pertaining to certain immovable properties situated at New Delhi.


(iii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidiary companies.


(iv) Corporate guarantees provided by the subsidiary companies owning the aforesaid immovable properties.


(r) Facility of Rs.12,955.57 lakhs, balance amount is repayable in 17 monthly installments starting from April 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company.


(ii) Charge on receivables and other current assets of the aforesaid immovable property owned by the Company.


(s) Facility of Rs.5,221.39 lakhs, balance amount is repayable in 12 monthly installments starting from April, 2016. The loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable property owned by subsidiary company.


Rate of interest:


The Company’s total borrowings from banks and others have an effective weighted-average contractual rate of 9.74% per annum calculated using the interest rate effective as on 31 March 2017 (31 March 2016: 10.55% and 31 March 2015: 11.48%).


6.1. Security disclosure for the outstanding short-term borrowings as at 31 March 2017:


Overdraft facility from Banks:


(a) Facility of Rs.30,421.19 lakhs


The aforesaid overdraft facilities are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.4,979.49 lakhs


The aforesaid overdraft facility is secured by way of:


(i) Equitable mortgage of property situated at New Delhi, owned by the Company.


Short-term loans from Banks:


(a) Facility of Rs.57,000.00 lakhs


The aforesaid short-term loans are secured by way of:


(i) Equitable mortgage of properties situated at Gurugram, owned by subsidary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of ‘16,000.00 lakhs


The aforesaid short-term loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidary company.


(iii) Corporate guarantee provided by the subsidiary companies owning the aforesaid immovable property.


(c) Facility of Rs.35,000.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of properties situated at Gurugram, owned by the Company and subsidiary companies.


(ii) Corporate guarantee provided by the subsidiary companies owning the aforesaid immovable properties.


(d) Facility of Rs.7,500.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the Company.


(ii) Charge on receivables and other current assets of the aforesaid immovable property owned by the Company.


(e) Facility of Rs.19,700.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at New Delhi, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable property owned by subsidary company.


(iii) Corporate guarantee provided by the Copmany/ subsidiary company owning the aforesaid immovable property.


(f) Facility of Rs.27,174.69 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at New Delhi, owned by subsidiary company.


Short-term loans from others:


(a) Facility of Rs.100,000.00 lakhs


The aforesaid short-term loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidary company.


6.2. Security disclosure for the outstanding short-term borrowings as at 31 March 2016:


Overdraft facility from Banks:


(a) Facility of Rs.32,503.28 lakhs


The aforesaid overdraft facilities are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.4,728.79 lakhs


The aforesaid overdraft facility is secured by way of:


(i) Equitable mortgage of properties situated at Goa and Gurugram, owned by subsidiary companies


(ii) Corporate guarantees provided by the subsidiary companies owning the aforesaid immovable properties.


(c) Facility of Rs.4,988.31 lakhs


The aforesaid overdraft facility is secured by way of:


(i) Equitable mortgage of property situated at New Delhi, owned by the Company.


Short-term loans from Banks:


(a) Facility of Rs.60,800.00 lakhs


The aforesaid short-term loans are secured by way of:


(i) Equitable mortgage of properties situated at Gurugram, owned by subsidary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.18,172.06 lakhs


The aforesaid short-term loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/ subsidary company.


(iii) Corporate guarantee provided by the subsidiary companies owning the aforesaid immovable property.


(c) Facility of Rs.35,000.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of properties situated at Gurugram, owned by the Company and subsidiary companies.


(ii) Corporate guarantee provided by the subsidiary companies owning the aforesaid immovable properties.


(d) Facility of Rs.7,500.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the Company.


(ii) Charge on receivables and other current assets of the aforesaid immovable property owned by the Company.


(e) Facility of Rs.19,700.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at New Delhi, owned by the Company/ subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable property owned by subsidary company.


(iii) Corporate guarantee provided by the Copmany/ subsidiary company owning the aforesaid immovable property.


(f) Facility of Rs.16,985.06 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at New Delhi, owned by subsidiary company.


6.3. Security disclosure for the outstanding short-term borrowings as at 1 April 2015:


Overdraft facility from Banks:


(a) Facility of Rs.29,079.33 lakhs


The aforesaid overdraft facilities are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.1.82 lakhs


The aforesaid overdraft facility is secured by way of:


(i) Equitable mortgage of properties situated at Goa and Gurugram, owned by subsidiary companies.


(ii) Corporate guarantees provided by the subsidiary companies owning the aforesaid immovable properties.


(c) Facility of Rs.4,998.01 lakhs


The aforesaid overdraft facility is secured by way of:


(i) Equitable mortgage of property situated at New Delhi, owned by the Company.


Short-term loans from Banks:


(a) Facility of Rs.67,800.00 lakhs


The aforesaid short-term loans are secured by way of:


(i) Equitable mortgage of properties situated at Gurugram, owned by subsidary company.


(ii) Corporate guarantee provided by the subsidiary company owning the aforesaid immovable properties.


(b) Facility of Rs.28,107.94 lakhs


The aforesaid short-term loans are secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by the Company/subsidiary companies.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by the Company/subsidary companies.


(iii) Corporate guarantee provided by the subsidiary companies owning the aforesaid immovable properties.


(c) Facility of Rs.35,000.00 lakhs


The aforesaid short-term loans are secured by way of:


(i) Equitable mortgage of properties situated at Gurugram, owned by the Company and subsidiary companies.


(ii) Corporate guarantee provided by the subsidiary companies owning the aforesaid immovable properties.


(d) Facility of Rs.7,500.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at Gurugram, owned by the Company.


(ii) Charge on receivables and other current assets of the aforesaid immovable property owned by the Company.


(e) Facility of Rs.19,700.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at New Delhi, owned by the Company/subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable property owned by subsidary company.


(iii) Corporate guarantee provided by the Company/subsidiary company owning the aforesaid immovable property.


(f) Facility of Rs.40,000.00 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable properties situated at Gurugram, owned by subsidiary company.


(ii) Charge on receivables pertaining to the aforesaid immovable properties owned by subsidary company.


(g) Facility of Rs.14,777.56 lakhs


The aforesaid short-term loan is secured by way of:


(i) Equitable mortgage of immovable property situated at New Delhi, owned by subsidiary company.


i) Fair values hierarchy


Financial assets and financial liabilities are measured at fair value in the financial statement and are grouped into three levels of a fair value hierarchy. The three Levels are defined based on the observability of significant inputs to the measurement, as follows:


Level 1: quoted prices (unadjusted) in active markets for financial instruments.


Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: unobservable inputs for the asset or liability.


ii) Financial assets measured at fair value - recurring fair value measurements


(iii) Valuation techniques used to determine fair value


Specific valuation techniques used to value financial instruments include:


(a) the use of net asset value for mutual funds on the basis of the statement received from investee party.


(b) the use of adjusted net asset value method for certain equity investment and discounted cash flow method (income approach) for remaining equity instruments.


(c) For hedge related effectiveness review and related valuation, details are presented in note 43.


(iv) The Company has used interest rate and USD/INR swap rate as inputs to arrive at fair value of derivative assets.


(v) The following table summarises the quantitative information about the significant unobservable inputs used in level 3 fair value measurements. See (iii) above for the valuation techniques adopted.


* The non-convertible redeemable debentures issued by the Company are listed on stock exchange and there is no comparable instrument having the similar terms and conditions with related security being pledged and hence the carrying value of the debentures represents the best estimate of fair value.


i) Financial instruments by category


For amortised cost instruments, carrying value represents the best estimate of fair value.


* Investment in equity shares of subsidiaries, associate and joint venture are measured as per Ind AS 27, “Separate financial statements”.


** These financial assets are mandatorily measured at fair value.


# These financial assets represents investment in equity instruments designated as such upon initial recognition.


ii) Risk Management


The Company’s activities expose it to market risk, liquidity risk and credit risk. The Company’s Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.


A) Credit risk


Credit risk is the risk that a counterparty fails to discharge its obligation to the Company. The Company’s exposure to credit risk is influenced mainly by cash and cash equivalents, trade receivables and financial assets measured at amortised cost. The Company continuously monitors defaults of customers and other counterparties and incorporates this information into its credit risk controls. Credit risk related to cash and cash equivalents and bank deposits is managed by only accepting highly rated banks and diversifying bank deposits. Other financial assets measured at amortized cost includes loans to employees, security deposits and others. Credit risk related to these other financial assets is managed by monitoring the recoverability of such amounts continuously, while at the same time internal control system in place ensure the amounts are within defined limits.


a) Credit risk management


i) Credit risk rating


The Company assesses and manages credit risk of financial assets based on following categories arrived on the basis of assumptions, inputs and factors specific to the class of financial assets.


A: Low credit risk


B: Moderate credit risk


C: High credit risk


* Life time expected credit loss is provided for trade receivables.


Based on business environment in which the Company operates, a default on a financial asset is considered when the counterparty fails to make payments within the agreed time period as per contract. Loss rates reflecting defaults are based on actual credit loss experience and considering differences between current and historical economic conditions.


Assets are written off when there is no reasonable expectation of recovery, such as a debtor declaring bankruptcy or a litigation decided against the Company. The Company continues to engage with parties whose balances are written off and attempts to enforce repayment. Recoveries made are recognized in statement of profit and loss.


b) Credit risk exposure


Provision for expected credit losses


The Company provides for expected credit loss based on 12 months and lifetime expected credit loss basis for following financial assets:


Expected credit loss for trade receivables under simplified approach Real estate business


The Company’s trade receivables does not have any expected credit loss as registry of properties sold is generally carried out once the Company receives the entire payment. During the periods presented, the Company made no write-offs of trade receivables and no recoveries from receivables previously written off.


Rental business


In respect of trade receivables, the Company considers provision for lifetime expected credit loss. Given the nature of business operations, the Company’s trade receivables has low credit risk as the Company holds security deposits equivalents ranging from three to six months rentals. Further historical trends indicate any shortfall between such deposits held by the Company and amounts due from customers have been negligible.


B) Liquidity risk


Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Due to the nature of the business, the Company maintains flexibility in funding by maintaining availability under committed facilities.


Management monitors rolling forecasts of the Company’s liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company takes into account the liquidity of the market in which the entity operates.


Maturities of financial liabilities


The tables below analyse the Company’s financial liabilities into relevant maturity groupings based on their contractual maturities.


C) Market Risk


a) Foreign currency risk


The Company has International transactions and is exposed to foreign exchange risk arising from foreign currency transactions. Foreign exchange risk arises from recognized assets and liabilities denominated in a currency that is not the Company’s functional currency.


b) Interest rate risk


i) Liabilities


The Company’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.


Interest rate risk exposure


The Company’s variable rate borrowing is subject to interest rate. Below is the overall exposure of the borrowing:


ii) Assets


The company’s fixed deposits, interest bearing security deposits and loans are carried at fixed rate. Therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.


c) Price risk


The Company’s exposure to price risk arises from investments held and classified as FVTPL. To manage the price risk arising from investments in mutual funds, the Company diversifies its portfolio of assets.


- Safeguard their ability to continue as a going concern, and


- Maintain an optimal capital structure to reduce the cost of capital.


The Company monitors capital on the basis of the carrying amount of equity less cash and cash equivalents as presented on the face of balance sheet.


The Company manages its capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.


A. Risk management strategy


The Company uses swaps contracts to hedge its risks associated with fluctuations in foreign currency. The risk being hedged is the risk of potential loss due to fluctuation in foreign currency rates. The use of swap contracts is covered by the Company’s overall strategy. The Company does not use swaps for speculative purposes. As per the strategy of the Company, foreign currency loans are covered by hedge, considering the risks associated with the hedging of such loans. The Company has designated the hedge as hedge of spot and accordingly, the Company has applied accounting for forward element of forward contracts under Ind AS 109 wherein the changes in fair value derivative is recognized in other comprehensive income and are accumulated in ‘Cash Flow Hedge Reserve’. Subsequently, the forward element of the derivative is amortised over the tenure of the foreign currency borrowing.


Hedge ratio is the relationship between the quantity of the hedging instrument and the quantity of the hedged item. In the case, total principal payments under the transaction is hedged under the swap con

CIN: U67190WB2003PTC096617. Trading in Commodities is done through our Group Company Dynamic Commodities Pvt. Ltd. The company is also engaged in Proprietory Trading apart from Client Business.
“2019 © COPYRIGHT DYNAMIC EQUITIES PVT. LTD.”

Disclaimer: There is no guarantee of profits or no exceptions from losses. The investment advice provided are solely the personal views of the research team. You are advised to rely on your own judgment while making investment / Trading decisions. Past performance is not an indicator of future returns. Investment is subject to market risks. You should read and understand the Risk Disclosure Documents before trading/Investing.

Disclosure: We, Dynamic Equities Private Limited are also engaged in Proprietory Trading apart from Client Business. In case of any complaints/grievances, clients may write to us at compliance@dynamiclevels.com

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