interarch building products pvt ltd Management discussions

You should read the following discussion in conjunction with our Restated Financial Information included herein as at and for the Financial Years ended March 31, 2021, March 31, 2022 and March 31, 2023 and as at and for the six months ended September 30, 2023, including the related notes, schedules and annexures.

Our Financial Year commences on April 1 and ends on March 31 of each year, and all references to a particular Financial Year are to the 12 months ended March 31 of that year. Unless otherwise stated, or the context otherwise requires, the financial information used in this section is derived from our "Financial Information" on page

300.

We have exclusively commissioned and paid for the services of independent third party research agency, CRISIL MI&A ("CRISIL") for the purposes of confirming our understanding of the industry in connection with the Offer, and have relied on the CRISIL Report, for industry related data in this Draft Red Herring Prospectus, including in the sections "Industry Overview", "Our Business" and "Managements Discussion and Analysis of

Financial Condition and Results of Operations" on pages 168, 224 and 384, respectively. We engaged CRISIL in connection with the preparation of the CRISIL Report pursuant to an engagement letter dated July 10, 2023. The CRISIL Report will be available on the website of our Company at https://www.interarchbuildings.com/crisil-report.asp from the date of this Draft Red Herring Prospectus till the Bid/Offer Closing Date, and has also been included in "Material Contracts and Documents for Inspection" on page 499. The data included herein includes excerpts from the CRISIL Report and may have been re-ordered by us for the purposes of presentation. There are no parts, data or information (which may be relevant for the proposed Offer), that has been left out or changed in any manner. Unless otherwise indicated, all financial, operational, industry and other related information derived from the CRISIL Report and included herein with respect to any particular year, refers to such information for the relevant financial year.

This discussion contains forward-looking statements that involve risks and uncertainties and reflects our current view with respect to future events and financial performance. Actual results may differ from those anticipated in these forward-looking statements as a result of factors such as those set forth under "Forward-looking Statements" and "Risk Factors" on pages 20 and 30, respectively.

Overview

We are one of the leading turnkey pre-engineered steel construction solution providers in India with integrated facilities for design and engineering, manufacturing, on-site project management capabilities for the installation and erection of pre-engineered steel buildings ("PEB"). (Source: CRISIL Report) We were ranked third in terms of operating revenue from PEB business in the Financial Year 2023 among integrated PEB players in India. (Source: CRISIL Report) Our Company further had the second largest aggregate installed capacity of 141,000 metric tonnes per annum ("MTPA") as of March 31, 2023 and a market share of 6.1% in terms of operating income in Financial Year 2023 among integrated PEB players in India. (Source: CRISIL Report) Our PEB offerings are designed, engineered and fabricated by us in accordance with customer requirements, and find use in construction for industrial, infrastructure and building (residential, commercial and non-commercial) end-use applications. We have delivered PEBs for projects ranging from multi-level warehouses for customers engaged in e-commerce to paint production lines for customers engaged in manufacturing of paints and, fast-moving consumer goods ("FMCG") sector for setting up manufacturing units for manufacturing their products. We have also supplied large-span PEBs for indoor stadiums and customers engaged in the cement industry. During the period from Financial Year 2015 to Financial Year 2023 and the six months ended September 30, 2023, we completed execution of 623 PEB Contracts, thereby demonstrating our extensive track record in the PEB industry. The Indian PEB industry is expected to grow at a CAGR of 10.5-11.5% CAGR over Financial Year 2023-Financial Year 2028 (Source: CRISIL Report), and our extensive track record, domain experience, established brand presence and market position, paired with our in-house design and engineering, manufacturing, supply, and on-site project management capabilities for the installation and erection of PEBs supplied by us, position us to benefit from such growth.

We offer our PEBs by way of: (a) pre-engineered steel building contracts ("PEB Contracts"), wherein we provide complete PEBs on a turn-key basis to our customers, and as a part of which, we also provide on-site project management expertise for the installation and erection of PEBs supplied by us at our customers sites; and (b) sale of pre-engineered steel building materials ("PEB Sales"), which includes (i) sale of metal ceilings and corrugated roofing (comprising metal suspended ceiling systems (under the brand, "TRAC^?"), metal roofing and cladding systems (under the brand, "TRACDEK^?") and permanent/metal decking (lost shuttering) over steel framing

(under the brand, "TRACDEK^? Bold-Rib")); (ii) supply of PEB steel structures (comprising, amongst other things, primary and secondary framing systems; as well as complete PEBs, such as non-industrial PEB buildings for non-industrial use, such as farmhouses and residential buildings (under the brand, "Interarch Life") for erection and installation by third party builders/erectors, and (iii) light gauge framing systems ("LGFS").

We were incorporated in 1983 and have presence of over 30 years in the PEB industry under our brands, "TRAC^?" and "TRACDEK^?". As on the date of this Draft Red Herring Prospectus, we have evolved into a turn-key PEB solutions provider, with integrated facilities for design and engineering, manufacture, and on-site project management capabilities for the installation and erection of PEBs supplied by us which enable us to deliver end-to-end solutions to our customers.

We primarily manufacture our products in-house at our four Manufacturing Facilities, comprising the Tamil Nadu Manufacturing Facilities, Pantnagar Manufacturing Facility, and Kichha Manufacturing Facility. As of March 31, 2023 and September 30, 2023, our Manufacturing Facilities had an aggregate installed capacity of 141,000 MTPA. See "Our Business -Manufacturing Facilities" on page 248. As of the date of this Draft Red Herring Prospectus, our Manufacturing Facilities are supplemented by three dedicated design and engineering centres situated in Noida, Uttar Pradesh, India; Chennai, Tamil Nadu, India; and Hyderabad, Telangana India, which enable us to firstly, offer customized PEBs in accordance with our customers requirements and, secondly, to continually undertake incremental enhancements and improvements of our processes and design, thereby simultaneously contributing towards enhancement of our design compliance and engineering standards which create efficient PEB designs. We are supported by our dedicated in-house on-site project management team. We have established eight sales and marketing offices in eight cities to cater to our customers across India. We are also in the process of setting-up a manufacturing unit as part of the phase 1 of the Andhra Pradesh Manufacturing Facility and also propose to undertake the Project and also upgrade our Kichha Manufacturing Facility, Tamil Nadu Manufacturing Facility I, Tamil Nadu Manufacturing Facility II and Pantnagar Manufacturing Facility by utilizing a portion of the Net Proceeds, in order to bolster our manufacturing capacity and capabilities. See "Objects of the Offer Details of the Objects of the Fresh Issue" on page 107. Additionally, we propose to set-up our Planned Gujarat

Manufacturing Facility. See "Our Business Planned Gujarat Manufacturing Facility" on page 253.

Our Company is led by our Promoters, Arvind Nanda who is also our Managing Director, Gautam Suri who is a Whole-time Director of our Company and Viraj Nanda and Ishaan Suri who are Non-Executive Directors of our Company. Our Promoters are supported by a qualified and experienced management team under the guidance of our Board of Directors, which consists of individuals from various professional backgrounds with substantial experience in the PEB industry. See "Promoters and Promoter Group" and "Our Management" on pages 294 and 274, respectively. We credit the building of our brand presence, our market position and the growth of our operations to the industry experience, vision and guidance of our Promoters and management team.

We credit our growth in revenue and profitability in part to our operational efficiency, which we seek to achieve by streamlining our operational activities and maintaining economies of scale. We have been able to grow our revenue from operations of 5,760.64 million in the Financial Year ended March 31, 2021 to 11,239.26 million in the Financial Year ended March 31, 2023, representing a CAGR of 39.68%.

Significant Factors Affecting our Results of Operations

Demand for our pre-engineered steel buildings

The Indian PEB industry expanded at a CAGR of ~8.5% over Financial Years 2019-2023, growing from 130 billion in Financial Year 2019 to 180 billion in Financial Year 2023 and is expected to grow to 195 billion- 200 billion in Financial Year 2024. The medium-term outlook is optimistic, with the industry growing at a 10.5-11.5% CAGR between Financial Year 2023- 2028 to 295-310 billion, supported by investments in the industrial and infrastructure sectors such as warehouses and logistics as well as expressways (way-side amenities and toll plazas). The total construction investments in the infrastructure sector is expected to attract investments of approximately 48.3 trillion between Financial Year 2024 - 2028, up from 26.6 trillion between Financial Year

2019-2023. (Source: CRISIL Report)

We were ranked third in terms of operating revenue from the PEB business in the Financial Year 2023 among the integrated PEB players. Our Company further had the second largest aggregate installed capacity of 141,000 MTPA as at March 31, 2023 and a market share of 6.1% in terms of operating income in Financial Year 2023 in India. We were incorporated in 1983 and have presence of over 30 years in the PEB industry under our brands,

" TRAC^?" and "TRACDEK^?", which we have leveraged to evolve into an end-to-end PEB solution provider and establish a track record based on extensive customer insights developed over the course of our operations, thereby enabling us to acquire new customers and cover various customer industries end-use applications for our PEBs.

As a manufacturer and provider of PEBs on a turn key basis to our customers and PEB buildings and structures as part of our PEB Sales, our profitability and future growth are correlated with and dependent upon the growth of the PEB industry in India. While the PEB market in India is projected to see growth in its share in the overall construction spend from 3-5% share in Financial Year 2023 to 5-7% by Financial Year 2028, it is considered to be in its infancy, and is subject to a number of key challenges, including:

(vii) vulnerability to fluctuations in raw material prices; (viii) transportation challenges;

(ix) necessity for additional safeguards to withstand natural disasters; (x) medium capital outlay and fragmented industry; (xi) inherent design limitations; and

(xii) limited knowledge and lack of skilled manpower. (Source: CRISIL Report)

Pre-engineered construction accelerates project timelines without compromising on deliverable quality. As pre-engineered construction involves components being first manufactured in factories/manufacturing plants, it allows simultaneous preparation of the foundation at the construction site. This not only helps accelerate project timelines, but also allows cost optimisation by decreasing overhead site costs, including labour costs. Furthermore, as pre-engineered structures are manufactured within factories/manufacturing plants, they allow standardising processes, which ensures good quality of structures. Additionally, as these structures are manufactured in factories/ manufacturing plants, they also prevent project delays stemming from external factors such as adverse weather. (Source: CRISIL Report)

Our extensive track record, domain experience, established brand presence and market position, paired with our integrated facilities for design and engineering, manufacture, on-site project management capabilities for installation and erection of PEBs supplied by us, position us to benefit from growth of the PEB industry in India. If the PEB industry in India fails to sustain or increase its adoption, including in particular by building, infrastructure and industrial sectors, our business may be adversely affected. If the PEB industry develops more slowly than expected, or if demand for PEBs decreases, there can be no assurance that our past performance will continue at a comparable scale in the future and our business, prospects, financial condition and operating results would be harmed.

Customer relationships, terms of supply arrangements and pricing of our products

We have relied on our experience in the Indian building products industry and our focus on quality, reliability and prompt delivery of our PEBs, to establish our brand presence and market position, which we attribute in part to our relationships with our customers. Our Company has worked with industry leaders in project development and construction, providing support to critical industrial, commercial and infrastructure projects (Source: CRISIL Report).

We have established long-standing relationships with a number of our customers, including various Customer Groups, which we attribute in part to our emphasis on quality consciousness, cost efficiency, and timely execution. Three of our top five Customer Groups (identified on the basis of revenue contribution in Financial Year ended March 31, 2023) have been associated with our Company for over five years. Set forth below is a breakdown of our revenue from Repeat Orders in the three preceding Financial Years ended March 31, 2021, March 31, 2022, and March 31, 2023 and in the six months ended September 30, 2023:

Particulars	For the Financial year ended March 31, 2021		For the Financial year ended March 31, 2022		For the Financial year ended March 31, 2023		For six months ended September 30, 2023
	Revenue (in million)	% of total revenue from operations	Revenue (in million)	% of total revenue from operations	Revenue (in million)	% of total revenue from operations	Revenue (in million)	% of total revenue from operations
Revenue from Repeat Orders	4,132.99	71.75	4,894.15	58.62	9,038.70	80.42	5,241.08	88.60

Set forth below is our revenue from top five Customer Groups in the three preceding Financial Years ended March 31, 2021, March 31, 2022, and March 31, 2023 and in the six months ended September 30, 2023:

Particulars	For the Financial year ended March 31, 2021		For the Financial year ended March 31, 2022		For the Financial year ended March 31, 2023		For six months ended September 30, 2023
	Revenue (in million)	% of total revenue from operations (excluding scrap sales and other services)	Revenue (in million)	% of total revenue from operations (excluding scrap sales and other services)	Revenue (in million)	% of total revenue from operations (excluding scrap sales and other services)	Revenue (in million)	% of total revenue from operations (excluding scrap sales and other services)
Revenue from top five Customer Groups	1,536.09	27.34	2,136.15	26.21	4,324.84	39.08	1,814.88	31.12

We typically do not enter into continuing or long-term arrangements with any of our customers, and rely on purchase orders issued by our customers from time to time, that set out the terms and conditions as well as customer specifications, timelines of delivery and other parameters, and also permit customers in certain instances to unilaterally terminate such orders, with or without cause. Certain PEB Contracts entered into by us entitle the customers inspect our Manufacturing Facilities and review our manufacturing processes and raw materials. Furthermore, our PEB Contracts typically contain provisions for warranty, defect liability and liquidated damages in the event of defect or non-conformity of our PEBs to customer specifications.

We have historically been dependent, and expect to depend, on such Customer Groups and such Repeat Orders, for a substantial portion of our revenue and the loss of any them for any reason (including due to loss of, or termination of existing arrangements; limitation to meet any change in quality specification, customization requirements, or change in construction technology; disputes with a customer; adverse changes in the financial condition of our customers, such as possible bankruptcy or liquidation or other financial hardship) could have a material adverse effect on our business, results of operations and financial condition.

See "Risk Factors - We derive a significant portion of our revenues from repeat orders placed by our customers and customer groups (identified as customers forming part of the same corporate group) which we identify as orders placed by customers or customer groups (identified as customers forming part of the same corporate group) that have placed orders with our Company previously. Any loss of, or a significant reduction in the repeat orders received by us could adversely affect our business, results of operations, financial condition and cash flows." on page 32.

Availability and price of key inputs and materials

For our PEB Contracts and PEB Sales, our primary raw material is steel in various descriptions and thickness i.e., hot rolled steel plates, galvanized steel coil sheets, standard hot rolled sections. Steel, which is the key raw material for the manufacturing of our products, is a commodity and is subject to fluctuation in commodity prices. Due to high dependence on steel, the ability of players in the PEB industry to tackle challenges related to input costs and working capital becomes crucial to the PEB industrys success.

We depend on third-party suppliers for supply of raw materials required in our production process. We do not have continuing arrangements for the supply of raw materials and rely on purchase orders which set out the terms and conditions in relation to quantity, pricing, scheduling and delivery details. Steel is our key raw material and finding readymade substitute suppliers for supplying the raw materials, including steel, of exact specifications and on terms and conditions acceptable to us may be difficult.

We procure our raw materials, including steel, from third parties based on purchase orders and do not have continuing arrangements with our suppliers. The absence of any long-term or continuing arrangements for firm commitments of quantities at fixed prices and the need to maintain a continued supply of raw materials may make it difficult to resist price increases imposed by our suppliers. We are therefore exposed to volatility in the prices of our key raw materials specifically of steel. Majority of our customer orders are based on fixed or pre-determined prices which makes it difficult for us to pass on the increased price to our customers.

The table below sets forth details of our cost of raw material and components consumed which primarily comprises expenses incurred on procuring steel, including as a percentage of our total expense for the Financial Years ended March 31, 2021, 2022 and 2023 and for the six months ended September 30, 2023 respectively:

Particulars	Financial Year ended March 31, 2021		Financial Year ended March 31, 2022		Financial Year ended March 31, 2023		Six months ended September 30, 2023
	Amount (in million)	% of Total expenses	Amount (in million)	% of Total expenses	Amount (in million)	% of Total expenses	Amount (in million)	% of Total expenses
Cost of raw material and components consumed	3,551.18	61.69	5,694.36	69.59	7,427.33	72.29	3,952.59	71.56

Interruption of, or a shortage in the supply of, raw materials required to manufacture our products, may also result in our inability to operate our Manufacturing Facilities at optimal capacities, leading to a decline in production and sales. See "Risk Factors - Our business and profitability are substantially dependent on the availability and the cost of our raw materials and components consumed, including steel, and any disruption to the timely and adequate supply of raw materials, or volatility in the prices of raw materials may adversely impact our business, results of operations, financial condition and cash flows" on page 30.

Our ability to effectively execute and expand our order book

Our track record has in turn contributed to our growing order book, as a result of an enhancement of our reputation and brand image, our ability to acquire new customers, and our ability to successfully win new projects due to improvement in our ability to pre-qualification requirements of customers. Details of our order book as on March 31, 2021, March 31, 2022 and March 31, 2023 and six months ended September 30, 2023 respectively, are set forth below:

				(in million)
Particulars	As on March 31,	As on March 31,	As on March 31,	As on September
	2021	2022	2023	30, 2023
Total order book*	3,949.34	10,448.79	10,303.03	10,362.72

Our order book as at a particular date is calculated based on the aggregate contract value of our ongoing projects as at such date reduced by the value of work invoiced by us until such date.

The growth of our order book is a cumulative indication of the revenues that we expect to recognise in future periods with respect to our existing PEB Contracts. We cannot guarantee that the income anticipated in our order book will be realised or if realised, will be realised on time or result in profits. The number of orders we have received in the past, our existing order book and our growth rate may not be indicative of the number of orders we will receive in the future.

The completion of our orders involves various execution risks including delay or disruption in supply of raw materials, unanticipated cost increases, force majeure events, time and cost overruns, geo-political issues and operational hazards and therefore, we may not always be able to execute our projects within the scheduled time. In the event of any disruptions while executing our projects, due to natural or man-made disasters, workforce disruptions, fire, explosion, failure of machinery, or any significant social, political or economic disturbances or civil disruptions in or around the jurisdictions where such projects are located, our ability to execute our projects may be adversely affected. Project delays, modifications in the scope or cancellations may occur from time to time, due to delay in payments by our customers or due to our own defaults on account of delay in delivering the order, incidents of force majeure, cash flows problems, regulatory delays, need for change in measurements and estimates used by us and any other factors beyond our control. In view of the above, projects can remain outstanding in the order book for extended periods of time due to the nature of the project and the timing of the services required for completion of such projects. Delays in the completion of a project for any reason whatsoever can lead to delay in receiving our payments and thereby leading to variability in revenue.

Delays in the execution of projects results in the cost overruns and affects our payment milestones, subsequently impacting our revenue recognition method and exposing our business to variability in revenue thereby creating an adverse impact on our revenue, cash flows and financial conditions. We may not be able to maintain and enhance our production capabilities within scheduled time or implement our production plans effectively at all.

See "Risk Factors - The number of orders we have received in the past, our current order book and our growth rate may not be indicative of the number of orders we will receive in future. Any delays in execution of our orders expose us to time and cost overruns and variability in revenue, materially and adversely impacting our revenue from operations, cash flows and financial conditions" on page 35.

Sales initiatives and pan-India presence

Our centralized corporate marketing team comprising six personnel as of September 30, 2023, is housed at our Corporate Office, and oversees overall marketing activities of our Company, including brand management, advertising and promotions, market research and analysis, digital marketing, marketing communications, public relations, market research, customer relationship management, and business development. The corporate marketing team is supported by 60 sales and marketing executives, including sales co-ordination and support staff as at September 30, 2023, operating out of eight sales and marketing offices in eight cities in the states of Gujarat, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan, Uttar Pradesh and West Bengal to cater to our customers across India. In addition to this, we have stationed sales and marketing employees in Chandigarh in Punjab and Haryana, Lucknow in Uttar Pradesh, Coimbatore in Tamil Nadu, Bhubaneshwar in Odisha, and Raipur in Chhattisgarh. Our sales and marketing team include qualified engineers that are able to discuss our offerings with technical understanding, and their local presence ensures effective execution of regional marketing and lead generation. Further, maintaining and enhancing our brands may require us to make substantial investments in areas such as marketing and advertising. Our sales and marketing team acts on the recommendations of the business development team to increase the market visibility of our brand and our products in those identified industries, avenues and channels.

Details of expenses incurred towards sales initiatives and as a percentage of revenue from operations in Financial Years ended March 31, 2021, March 31, 2022 and March 31, 2023 and for the six months ended September 30, 2023 respectively, is set forth below:

Particulars	Financial year ended March 31, 2021		Financial year ended March 31, 2022		Financial year ended March 31, 2023		For six months ended September 30, 2023
	Amount (in million)	% of revenue from operations	Amount (in million)	% of revenue from operations	Amount (in million)	% of revenue from operations	Amount (in million)	% of revenue from operations
Expenses incurred towards sales initiatives	8.39	0.15	10.08	0.12	15.75	0.14	9.72	0.16

Includes advertisement and sales promotion expenses and rent expenses for sales and marketing offices

Our Company further proposes to expand its sales and marketing team by hiring additional personnel, including to service its customers in Maharashtra, India. Further, while as on the date of this Draft Red Herring Prospectus, our Companys sales have been pre-dominantly in India, we are currently evaluating expanding our network to Central and West Asia, South East Asia and Africa. See "Our Business Our Strategies - Expanding geographical footprint to cater to strategic markets in India and overseas" on page 237.

However, marketing and advertising campaigns may not be effective to the extent planned or at all and we may, therefore, fail to attract new customers. Further, we may also fail to penetrate new target markets if our marketing and advertising programs are unsuccessful or not appropriately tailored to appeal to the target market. In the event, marketing and advertising campaigns are not as effective as our competitors, our competitive position could be adversely affected, which would have a material adverse effect on our business, results of operations, financial condition and cash flows.

Also see, "Risk Factors - If we cannot execute our strategies to target new customers and expand existing customer base effectively, our business and prospects may be materially and adversely affected", "Risk Factors

- Our expansion of geographical footprint and execution capabilities may not be successful" and "Risk Factors

- Any reputational damage to our brand could have an adverse effect on our business, results of operation, financial condition and cash flows" on pages 62, 62 and 63, respectively.

Government initiatives

As of calendar year 2022, Indias annual per capita steel consumption stood at 81.1 kg per annum, compared to the global average of 221.8 kg. Government polices like National Steel Policy aims to increase per capita steel consumption of India and create a technologically advanced and globally competitive steel industry in India to promote self-sufficiency in steel production as well as economic growth. The National Steel Policy focuses on the following three main aspects: (i) increase in consumption of steel through major sectors of infrastructure, automobiles and housing; (ii) to achieve 300MT of steelmaking capacity by 2030; and (iii) to increase per capita steel consumption to the level of 160 Kgs by 2030. This is expected to aid pre-engineered building industry by positively impacting the quality of steel available, which is the dominant raw material required for pre-engineered buildings. Additionally, increasing penetration of pre-engineered buildings in infrastructure projects coupled with National Steel Policys aim to boast steel consumption in infrastructure sector is expected to positively impact pre-engineered buildings. (Source: CRISIL Report) A withdrawal of this policy could have an adverse impact on our business, results of operations, cash flows and financial condition.

Furthermore, the Government of India has also implemented the Domestically Manufactured Iron & Steel

Products (DMI&SP) Policy for promoting ‘Made in India steel for government procurement. Additionally, in

2021, the Government of India approved the Production Linked Incentive (PLI) Scheme for specialty steel ("Steel PLI Scheme"). The duration of the Steel PLI Scheme will be five years, from Financial Year 2024 to Financial

Year 2028. With a budgetary outlay of 63.2 billion, the Steel PLI Scheme is expected to bring in investment of approximately 400.0 billion and capacity addition of 25 MT for speciality steel. These steps will positively impact the availability and quality of steel as a raw material, supporting the PEB industry. (Source: CRISIL Report)

We expect to benefit from the above government initiatives and other initiatives similar thereto, and our business growth and continued profitability would depend in part on favorable government initiatives such as these, and in the absence of such favorable initiatives, our growth and future financial performance may be adversely affected.

Summary of Material Accounting Policies

I. Current versus non-current classification

The Company presents assets and liabilities in the Restated Summary Statements of Assets and Liabilities based on current/ non-current classification. An asset is treated as current when it is:

a) Expected to be realised or intended to be sold or consumed in normal operating cycle; or b) Held primarily for the purpose of trading; or c) Expected to be realised within twelve months after the reporting period; or d) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is current when:

a) It is expected to be settled in normal operating cycle; or b) It is held primarily for the purpose of trading; or c) It is due to be settled within twelve months after the reporting period; or d) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The Company has identified twelve months as its operating cycle.

II. Foreign currencies

(i) Functional and presentation currency

Items included in the Restated Summary Statements are measured using the currency of the primary economic environment in which the entity operates ("the functional currency"). The Restated Summary Statements are presented in Indian rupee (INR), which is Companys functional and presentation currency.

(ii) Transactions and balances

Transactions in foreign currencies are initially recorded by the Companys at functional currency spot rates at the date the transaction first qualifies for recognition. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date. Exchange differences arising on settlement or translation of monetary items are recognised in profit or loss. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of initial transaction.

All foreign exchange gains and losses are presented in the statement of profit and loss on a net basis.

In determining the spot exchange rate to use on initial recognition of the related asset, expense or income (or part of it) on the derecognition of a non-monetary asset or non-monetary liability relating to advance consideration, the date of the transaction is the date on which the Company initially recognises the non-monetary asset or non-monetary liability arising from the advance consideration. If there are multiple payments or receipts in advance, the Company determines the transaction date for each payment or receipt of advance consideration.

III. Fair value measurement

The Company measures financial instrument, such as, derivatives at fair value at each balance sheet date. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

- In the principal market for the asset or liability, or

- In the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market must be accessible by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participants ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the Restated Summary Statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1 - Quoted (unadjusted) prices in active markets 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

For assets and liabilities that are recognised in the Restated Summary Statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by reassessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

The Companys finance department includes team that determines the policies and procedures for both recurring fair value measurement, such as valuation of assets and liabilities required for financial reporting purposes, including level 3 fair values.

External valuers are involved for valuation of significant assets, such as Property, plant and equipment and Right of use assets- leasehold land and liabilities such as corporate guarantee and personal guarantee. Involvement of external valuers is decided upon annually by the finance team after discussion with and approval by the Chief Financial Officer (CFO), Chief Executive Officer (CEO) and Managing Director (MD). Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained.

The finance team and CFO decides, after discussions with the CEO, MD and external valuers, which valuation techniques and inputs to use for each case. At each reporting date, the finance team analyses the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Companys accounting policies. For this analysis, the finance team verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.

The finance team also compares the change in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable.

On an interim basis, the finance team present the valuation results to the CFO, CEO, MD and the Companys independent auditors. This includes a discussion of the major assumptions used in the valuations.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

Fair value related disclosure for financial instruments and non-financial assets which are measured at fair value are disclosed in the relevant notes.

IV. Revenue from contract with customer

The Company enters into two types of contracts with customers i.e. fixed price contract and variable price contract. Variable price contracts are such contracts wherein price of goods or services is calculated by reference to a base steel price agreed with customers at the time of contract execution. The Company enters in variable price contracts for sale of pre-engineered building and sale of building material contracts. Under these contracts, price of pre-engineered building and building material are calculated in reference to steel prices.

Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company has generally concluded that it is the principal in its revenue arrangements, because it typically controls the goods or services before transferring them to the customer.

Sale of Pre-engineered building (PEB) contracts

In respect of pre-engineered building contracts, revenue is recognised over a period of time using the input method (equivalent to percentage of completion method; POCM) of accounting with contract costs incurred determining the degree of completion of the performance obligation.

Revenue is measured based on the transaction price, which is the consideration, adjusted for volume discounts, price concessions and incentives, if any, as specified in the contract with the customer. Revenue also excludes taxes collected from customers on behalf of the government.

Percentage of completion is determined on the basis of proportion of the costs of shipment made and cost of erection incurred as against the total estimated cost of shipment and erection.

Contracts are combined when the Company believes the underlying goods and services are a single performance obligation, single commercial objective or the consideration in one contract depends on another. Else contracts are separated.

Where the total cost of a contract, based on technical and other estimates is expected to exceed the corresponding contract value, such expected loss is provided for. The effect of any adjustment from revisions to estimate is included in the statement of profit and loss for the period in which revisions are made.

Liquidated damages (LD) represents the expected claim which the Company may need to pay for non-fulfilment of certain commitments as per the terms of respective sales contract. These are determined on case to case basis considering the dynamics of each contract and the factors relevant to that sale.

The Company provides installation services that are bundled together with the sale of products to a customer. Contracts for bundled sales of product and installation services are considered as one performance obligations because company believes underlying goods and services are a single performance obligation, single commercial objective or the consideration in one contract depends on another. Hence the installation services has been considered as a part of sale of pre-engineered building contracts.

Sale of building materials

Revenue from sale of building materials is recognised at the point in time when control of the asset is transferred to the customer, generally on delivery of the material. The payment terms depends upon each contract entered into with the customer.

The Company considers whether there are other promises in the contract that are separate performance obligations to which a portion of the transaction price needs to be allocated (e.g., warranties). In determining the transaction price, the Company considers the effects of variable consideration, the existence of significant financing components, non-cash consideration, and consideration payable to the customer (if any).

Variable Consideration

If the consideration in a contract includes a variable amount, the Company estimates the amount of consideration to which it will be entitled in exchange for transferring the goods to the customer. The variable consideration is estimated at contract inception and constrained until it is highly probable that a significant revenue reversal in the amount of cumulative revenue recognised will not occur when the associated uncertainty with the variable consideration is subsequently resolved.

The revenue on account of extra claims on pre-engineering building contracts are accounted for at the time of acceptance/settlement by the customers, due to uncertainties attached there to.

Significant financing component

The Company applies the practical expedient for short-term advances received from customers. That is, the promised amount of consideration is not adjusted for the effects of a significant financing component if the period between the transfer of the promised good or service and the payment is one year or less.

Warranty obligations

The Company typically provides warranties for general repairs of defects that existed at the time of sale. These assurance-type warranties are accounted for under Ind AS 37 Provisions, Contingent Liabilities and Contingent Assets.

Interest income

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "other income" in the statement of profit and loss.

Other

Other items of income are accounted as and when the right to receive such income arises and it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably.

Contract balances

a. Contract Assets:

Revenue earned but not billed to customers against erection and sale of goods and services is reflected as Contract assets because the receipt of consideration is conditional on Companys performance under the contract (i.e transfer control of related goods or services to the customer). Upon completion of the installation and acceptance by the customer, the amount recognised as contract assets is reclassified to trade receivables.

Contract assets are subject to impairment assessment.

b. Trade Receivables

A receivable is recognised if an amount of consideration that is unconditional (i.e., only the passage of time is required before payment of the consideration is due).

c. Contract Liabilities:

A contract liability is recognised if a payment is received or a payment is due (whichever is earlier) from a customer before the Company transfers the related goods or services. Contract liabilities are recognised as revenue when the Company performs under the contract (i.e., transfers control of the related goods or services to the customer).

V. Government grants

Government grants are recognised where there is reasonable assurance that the grant will be received, and all attached conditions will be complied with. When the grant relates to an expense item, it is recognised as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. When the grant relates to an asset, it is recognised as income in equal amounts over the expected useful life of the related asset.

When the Company receives grants of non-monetary assets, the asset and the grant are recorded at fair value amounts and released to profit or loss over the expected useful life in a pattern of consumption of the benefit of the underlying asset i.e. by equal annual instalments.

The Company has elected to present the grant in the balance sheet as deferred income, which is recognised in profit or loss on a systematic and rational basis over the useful life of the asset.

VI. Taxes:

a. Current Income Tax

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date in the countries where the Company operates and generates taxable income.

Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Current tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and considers whether it is probable that a taxation authority will accept an uncertain tax treatment. The Company shall reflect the effect of uncertainty for each uncertain tax treatment by using either most likely method or expected value method, depending on which method predicts better resolution of the treatment.

b. Deferred tax

Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable temporary differences, except when the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except when the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re- assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised, or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity.

The Company offsets deferred tax assets and deferred tax liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority.

In assessing the recoverability of deferred tax assets, the Company relies on the same forecast assumptions used elsewhere in the Restated Summary Statements and in other management reports.

c. Goods and service taxes (GST) paid on acquisition of assets or on incurring expenses

Expenses and assets are recognised net of the amount of goods and service taxes paid, except:

- when the tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case, the tax paid is recognised as part of the cost of acquisition of the asset or as part of the expense item, as applicable. - when receivables and payables are stated with the amount of tax included. - the net amount of tax recoverable from, or payable to, the taxation authority is included as part of other current assets or liabilities in the balance sheet.

VII. Property, plant and equipment

Under the previous GAAP, Property, plant and equipment and capital work in progress were carried in the balance sheet at cost net of accumulated depreciation and accumulated impairment loss (if any). On transition to Ind AS, the Company has elected to measure all items of property, plant and equipment at the date of transition i.e. April 1, 2021 to Ind AS at its fair value and use that fair values as its deemed cost at that date.

Capital work in progress is stated at cost, net of accumulated impairment loss, if any. Plant and equipment are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are met. When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as incurred. The present value of the expected cost for the decommissioning of an asset after its use (if any) is included in the cost of the respective asset if the recognition criteria for a provision are met. As per estimate of the management, the Company does not have any expected cost of decommission on any asset.

When significant parts are required to be replaced at regular intervals, the Company recognises such parts as separate component of assets and depreciates separately based on their specific useful life. When an item of PPE is replaced, then its carrying amount is de-recognised and cost of the new item of PPE is recognised.

Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets as follows:

Tangible assets	Useful life as per Schedule II (in years)	Useful life estimated by the management based on technical assessment (in years)
Factory building*	30 years	40 years
Non factory building*	60 years	40 years
Electrical Fittings	10 years	10 years
Plant and equipment	15 years	15 years
Office equipment	5 years	5 years
Furniture and fixtures	10 years	10 years
Computers	3 years	3 years
Vehicles*	8 years	7-8 years

Machinery spares are depreciated on straight line basis over the remaining useful life of related plant and equipment or useful life of spare part, whichever is lower.

*The Company, based on technical assessment made by technical expert and management estimate, depreciates Buildings and certain items of plant and equipment over estimated useful lives which are different from the useful life prescribed in Schedule II to the Companies Act, 2013. The management believes that these estimated useful lives are realistic and reflect fair approximation of the period over which the assets are likely to be used.

An item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of profit and loss when the asset is derecognised.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

VIII. Investment properties

On transition to Ind As (i.e. April 1, 2021), the Company has elected to continue with the carrying value of all investment properties measured as per the previous GAAP and use that carrying value as the deemed cost of investment properties.

Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any.

The cost includes the cost of replacing parts and borrowing costs for long-term construction projects if the recognition criteria are met. When significant parts of the investment properties are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. All other repair and maintenance costs are recognised in profit or loss as incurred.

Depreciation on electrical fittings & furniture and fixtures components of investment property having gross block of 0.37 million is calculated on a straight line basis using the rates arrived at based on the useful life estimated by the management, which are equal to corresponding life prescribed in Schedule II to the Companies Act, 2013.

Depreciation on factory buildings component of investment property having gross block of 13.25 million is calculated on a straight line basis over the remaining useful life after considering the overall useful life of 40 years (as re-assessed by the management in an earlier year based on technical evaluation), which is higher than the useful life prescribed in Schedule II to Companies Act, 2013.

Depreciation on residential property component of investment property of 3.05 million, which is yet to be available for use, will be calculated once the said property is available for use.

Depreciation on Leasehold land component of investment property taken on lease is calculated over the useful life or the period of primary lease of 90 years, whichever is lower.

Though the Company measures investment properties using cost-based measurement, the fair value of investment properties are disclosed in the notes. Fair values are determined based on an annual evaluation performed by an accredited external independent valuer applying a valuation model recommended by the International Valuation Standards Committee.

Investment properties are derecognised either when they have been disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition. In determining the amount of consideration from the derecognition of investment properties the Company considers the effects of variable consideration, existence of a significant financing component, non-cash consideration, and consideration payable to the buyer (if any).

Transfers are made to (or from) investment properties only when there is a change in use. Transfers between investment property, owner-occupied property and inventories do not change the carrying amount of the property transferred and they do not change the cost of that property for measurement or disclosure purposes.

IX. Intangible assets:

On transition to Ind AS, the Company has elected to continue with the carrying value of all intangible assets recognised as at April 1, 2021 measured as per the previous GAAP and use that carrying value as the deemed cost of such other intangible assets.

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses. Internally generated intangibles, excluding capitalised development costs, are not capitalised and the related expenditure is reflected in profit or loss in the period in which the expenditure is incurred.

Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss unless such expenditure forms part of carrying value of another asset.

An intangible asset is derecognised upon disposal (i.e., at the date the recipient obtains control) or when no future economic benefits are expected from its use or disposal. Any gain or loss arising upon derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of profit and loss. when the asset is derecognised.

Computer software:

Cost relating to software and software licenses, which are acquired, are capitalized and amortized on a straight-line basis over their estimated useful lives of three years or actual period of license, whichever is lower.

X. Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

XI. Leases

The Company assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Company as a Lessee

The Company applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. The Company recognises lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.

i. Right of Use Assets:

The Company recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets, as follows:

Plant and machinery - 8 years Building - 10 years Land - 90/99 years

If ownership of the leased asset transfers to the Company at the end of the lease term or the cost reflects the exercise of a purchase option, depreciation is calculated using the estimated useful life of the asset. The right-of-use assets are also subject to impairment.

ii. Lease Liabilities:

At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Company and payments of penalties for terminating the lease, if the lease term reflects the Company exercising the option to terminate. Variable lease payments that do not depend on an index or a rate are recognised as expenses (unless they are incurred to produce inventories) in the period in which the event or condition that triggers the payment occurs.

In calculating the present value of lease payments, the Company uses its incremental borrowing rate at the lease commencement date because the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in an index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.

The cost and accumulated depreciation for right of use assets where the leases gets matured or disposed off before maturity are de-recognised from the balance sheet and the resulting gains/(losses) are included in the statement of profit and loss within other expenses /other income. Lease liabilities and right of use assets have been presented as separate line in the balance sheet. Lease payments have been classified as cash used in financing activities.

iii. Short-term leases and leases of low-value assets

The Company applies the short-term lease recognition exemption to its short-term leases of building and plant and equipment (i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option), except in case of lease contracts with related parties since there exist economic incentive for the Company to continue using the leased premises for a period longer than 11 months and considering the contract is with the related parties, it does not foresee non-renewal of the lease term for future periods, thus basis the substance and economic of the arrangements, management believes that under Ind AS 116, the lease terms in the arrangements with related parties have been determined considering the period for which management has an economic incentive to use the leased assets (i.e., reasonably certain to use the asset for the said period of economic incentive). Such assessment of incremental period is based on management assessment of various factors including the remaining useful life of the assets as on the date of transition. The management has assessed period of arrangement with related parties as 10 years as at April 1, 2021. It also applies the lease of low-value assets recognition exemption to leases of plant and equipment that are considered to be low value. Lease payments on short-term leases and leases of low-value assets are recognised as expense on a straight-line basis over the lease term.

Company as a Lessor

Leases in which the Company does not transfer substantially all the risks and rewards incidental to ownership of an asset are classified as operating leases. Rental income arising is accounted for on a straight-line basis over the lease terms. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income. Contingent rents are recognised as revenue in the period in which they are earned.

Leases are classified as finance leases when substantially all of the risks and rewards of ownership transfer from the Company to the lessee. Amounts due from lessees under finance leases are recorded as receivables at the Companys net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.

XII. Inventories

Inventories are valued at the lower of cost and net realisable value.

i. Raw materials and components, packing materials and stores and spares:

Cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost of raw materials and components, packing materials and stores and spares is determined on a moving weighted average method. Stores and spares which do not meet the definition of property, plant and equipment are accounted as inventories.

ii. Work in progress, Semi-finished goods and finished goods.

Lower of cost and net realizable value. Cost includes cost of direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost is determined on a moving weighted average basis.

iii. Scrap.

Scrap is valued at net realizable value.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

XIII. Impairment of non - financial assets

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the assets recoverable amount. An assets recoverable amount is the higher of an assets fair value less costs of disposal and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples or other available fair value indicators.

The Company bases its impairment calculation on detailed budgets and forecast calculations, which are prepared separately for each of the Companys CGUs to which the individual assets are allocated. These budgets and forecast calculations generally cover a period of five years. For longer periods, a long-term growth rate is calculated and applied to project future cash flows after the fifth year. To estimate cash flow projections beyond periods covered by the most recent budgets/forecasts, the Company extrapolates cash flow projections in the budget using a steady or declining growth rate for subsequent years, unless an increasing rate can be justified. In any case, this growth rate does not exceed the long-term average growth rate for the products, industries, or country or countries in which the Company operates, or for the market in which the asset is used.

Impairment losses of continuing operations including impairment on inventories, are recognised in the statement of profit and loss.

The impairment assessment for all assets is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the

Company estimates the assets or CGUs recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the assets recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit and loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as revaluation increase.

The Company assesses where climate risks could have a significant impact, such as the introduction of emission-reduction legislation that may increase manufacturing costs. These risks in relation to climate-related matters are included as key assumptions where they materially impact the measure of recoverable amount, These assumptions have been included in the cash-flow forecasts in assessing value-in-use amounts.

XIV. Provisions, contingent liabilities and contingent assets

i. General

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Company expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

ii. Onerous contracts

If the Company has a contract that is onerous, the present obligation under the contract is recognised and measured as a provision. However, before a separate provision for an onerous contract is established, the Company recognises any impairment loss that has occurred on assets dedicated to that contract.

An onerous contract is a contract under which the unavoidable costs (i.e., the costs that the Company cannot avoid because it has the contract) of meeting the obligations under the contract exceed the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfil it. The cost of fulfilling a contract comprises the costs that relate directly to the contract (i.e., both incremental costs and an allocation of costs directly related to contract activities).

iii. Contingent liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non- occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle obligation. A contingent liability also arises in extremely rare cases where there is a liability that can not be recognised because it cannot be measured reliably. The Company does not recognise a contingent liability but discloses its existence in the Restated Summary Statements.

iv. Contingent assets

Contingent assets are not recognised in the financial statement. however, when the realization of income is virtually certain, then the related asset is not a contingent asset and its recognition is appropriate.

XV. Retirement and other employee benefits Provident fund

Retirement benefit in the form of provident fund is a defined contribution scheme. The Company has no obligation, other than the contribution payable to the provident fund. The Company recognizes contribution payable to the provident fund scheme as an expense, when an employee renders the related service. If the contribution payable to the scheme for service received before the balance sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognized as a liability after deducting the contribution already paid. If the contribution already paid exceeds the contribution due for services received before the balance sheet date, then excess is recognized as an asset to the extent that the pre- payment will lead to, for example, a reduction in future payment or a cash refund.

Defined benefit plan

The Company operates one defined benefit gratuity plan for its employees. The Companys net obligation in respect of defined benefit gratuity plan is calculated by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Company, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan (‘the asset ceiling). To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognised immediately in OCI. The Company determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate determined by reference to market yields at the end of the reporting period on government bonds. This rate is applied on the net defined benefit liability (asset), both as determined at the start of the annual reporting period, taking into account any changes in the net defined benefit liability (asset) during the period as a result of contributions and benefit payments. Net interest expense and other expenses related to defined benefit plans are recognised in profit or loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service (‘past service cost or ‘past service gain) or the gain or loss on curtailment is recognised immediately in profit or loss. The Company recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.

Short term employee benefits

Accumulated leave, which is expected to be utilized within the next 12 months, is treated as short-term employee benefit. The Company measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reporting date. The Company recognizes expected cost of short-term employee benefit as an expense, when an employee renders the related service.

Long term employee benefits

The Company treats accumulated leave expected to be carried forward beyond twelve months, as long-term employee benefit for measurement purposes. Such long-term compensated absences are provided for based on the actuarial valuation using the projected unit credit method at the reporting date. Actuarial gains/losses are immediately taken to the statement of profit and loss and are not deferred. The obligations are presented as current

401 liabilities in the balance sheet if the entity does not have an unconditional right to defer the settlement for at least twelve months after the reporting date.

XVI. Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

Financial assets:

Initial recognition and measurement:

Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other comprehensive income (OCI), and fair value through profit or loss. The classification of financial assets at initial recognition depends on the financial assets contractual cash flow characteristics and the Companys business model for managing them. With the exception of trade receivables that do not contain a significant financing component or for which the Company has applied the practical expedient, the Company initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not contain a significant financing component or for which the Company has applied the practical expedient are measured at the transaction price determined under Ind AS 115.

In order for a financial asset to be classified and measured at amortised cost or fair value through OCI, it needs to give rise to cash flows that are ‘solely payments of principal and interest (SPPI) on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. Financial assets with cash flows that are not SPPI are classified and measured at fair value through profit or loss, irrespective of the business model.

The Companys business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Financial assets classified and measured at amortised cost are held within a business model with the objective to hold financial assets in order to collect contractual cash flows while financial assets classified and measured at fair value through OCI are held within a business model with the objective of both holding to collect contractual cash flows and selling.

Subsequent measurement

For purposes of subsequent measurement, financial assets are classified in four categories:

i. Financial assets at amortised cost (debt instruments) ii. Financial assets at fair value through other comprehensive income (FVTOCI) with recycling of cumulative gains and losses (debt iii. Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity iv. Financial assets at fair value through profit or loss

Financial assets at amortised cost (debt instruments)

A ‘financial asset is measured at the amortised cost if both the following conditions are met:

i. The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and

ii. Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding.

This category is the most relevant to the Company. After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included in finance income in the profit or loss. The losses arising from impairment are recognised in the profit or loss. The Companys financial assets at amortised cost includes trade receivables, and security deposit included under other non-current financial assets.

Financial assets at fair value through OCI (FVTOCI) (debt instruments)

A ‘financial asset is classified as at the FVTOCI if both of the following criteria are met:

i. The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets, and ii. The assets contractual cash flows represent SPPI Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. For debt instruments, at fair value through OCI, interest income, foreign exchange revaluation and impairment losses or reversals are recognised in the profit or loss and computed in the same manner as for financial assets measured at amortised cost. The remaining fair value changes are recognised in OCI. Upon derecognition, the cumulative fair value changes recognised in OCI is reclassified from the equity to profit or loss.

The Company has not designated any financial asset (debt instruments) at FVTOCI.

Financial assets designated at fair value through OCI (equity instruments)

Upon initial recognition, the Company can elect to classify irrevocably its equity investments as equity instruments designated at fair value through OCI when they meet the definition of equity under Ind AS 32 Financial Instruments: Presentation and are not held for trading. The classification is determined on an instrument-by-instrument basis. Equity instruments which are held for trading and contingent consideration recognised by an acquirer in a business combination to which Ind AS103 applies are classified as at FVTPL.

Gains and losses on these financial assets are never recycled to profit or loss. Dividends are recognised as other income in the statement of profit and loss when the right of payment has been established, except when the Company benefits from such proceeds as a recovery of part of the cost of the financial asset, in which case, such gains are recorded in OCI. Equity instruments designated at fair value through OCI are not subject to impairment assessment.

The Company has not designated any financial asset (equity instruments) as at FVTOCI.

Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss are carried in the balance sheet at fair value with net changes in fair value recognised in the statement of profit and loss.

This category includes such financial assets which the Company had not irrevocably elected to classify at fair value through OCI. The Company has designated investments in mutual funds (debt instruments) in this category.

Embedded Derivatives

A derivative embedded in a hybrid contract, with a financial liability or non-financial host, is separated from the host and accounted for as a separate derivative if: the economic characteristics and risks are not closely related to the host; a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative; and the hybrid contract is not measured at fair value through profit or loss. Embedded derivatives are measured at fair value with changes in fair value recognised in profit or loss. Reassessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss category.

Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial assets) is primarily derecognised (i.e. removed from the Companys balance sheet) when:

i. The rights to receive cash flows from the asset have expired, or

ii. The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Companys continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.

Impairment of financial assets

The Company recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Company expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).

For trade receivables and contract assets, the Company applies a simplified approach in calculating ECLs. Therefore, the Company does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Company has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.

The Company considers a financial asset in default when contractual payments are 90 days past due. However, in certain cases, the Company may also consider a financial asset to be in default when internal or external information indicates that the Company is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Company. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows.

Reclassification of financial assets

The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Companys senior management determines change in the business model as a result of external or internal changes which are significant to the Companys operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.

The following table shows various reclassification and how they are accounted for:

Original classification	Revised classification	Accounting treatment
Amortised cost	FVTPL	Fair value is measured at reclassification date. Difference between previous amortized cost and fair value is recognised in profit or loss.
FVTPL	Amortised Cost	Fair value at reclassification date becomes its new gross carrying amount. EIR is calculated based on the new gross carrying amount.
Amortised cost	FVTOCI	Fair value is measured at reclassification date. Difference between previous amortised cost and fair value is recognised in OCI. No change in EIR due to reclassification.
FVTOCI	Amortised cost	Fair value at reclassification date becomes its new amortised cost carrying amount. However, cumulative gain or loss in OCI is adjusted against fair value. Consequently, the asset is measured as if it had always been measured at amortised cost.
FVTPL	FVTOCI	Fair value at reclassification date becomes its new carrying amount. No other adjustment is required.
FVTOCI	FVTPL	Assets continue to be measured at fair value. Cumulative gain or loss previously recognized in OCI is reclassified from equity to profit or loss the reclassification date.

Financial Liabilities:

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.

The Companys financial liabilities include trade and other payables, loans and borrowings.

Subsequent measurement

For purposes of subsequent measurement, financial liabilities are classified in two categories:

i. Financial liabilities at fair value through profit or loss ii. Financial liabilities at amortised cost (loans and borrowings)

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss.

Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.

Gains or losses on liabilities held for trading are recognised in the profit or loss.

Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit risk are recognized in OCI. These gains/ losses are not subsequently transferred to P&L. However, the Company may transfer the cumulative gain or loss within equity. All other changes in fair value of such liability are recognised in the statement of profit and loss. The Company has not designated any financial liability as at fair value through profit or loss.

Financial liabilities at amortised cost (Loans and borrowings)

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortization process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statement of profit and loss.

This category generally applies to borrowings.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit and loss.

Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

XVII. Cash and cash equivalents:

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, that are readily convertible to a known amount of cash and subject to an insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the Companys cash management.

XVIII. Dividend:

The Company recognises a liability to pay dividend to equity holders of the parent when the distribution is authorised, and the distribution is no longer at the discretion of the Company. As per the corporate laws in India, a distribution is authorised when it is approved by the shareholders. A corresponding amount is recognised directly in equity.

XIX. Earnings per share:

Basic earnings per share is calculated by dividing the net profit or loss attributable to equity holders of Company (after deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the period.

The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue, bonus element in a rights issue, share split, and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholders of the Company and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

XX. Segment Reporting Identification of segments

The Companys operating businesses are organised and managed on a single segment considering activities of manufacturing, supply, erection and installation of pre- engineered buildings and related services as one single operating segment. The analysis of geographical segments is based on the location in which the customers are situated.

Segment accounting policies

The Company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the Restated Summary Statements of the Company as whole.

NON-GAAP FINANCIAL MEASURES

This Draft Red Herring Prospectus contains certain non-GAAP financial measures and certain other statistical information relating to our operations and financial performance like EBITDA, EBITDA Margin, Net Debt, Net Debt to EBITDA, Return on Capital Employed, Profit Margin, Cash Conversion Cycle, Asset turnover Ratio (together, "Non-GAAP Measures") and certain other statistical information relating to our operations and financial performance that are not required by, or presented in accordance with, Ind AS, Indian GAAP, or IFRS. Further, these Non-GAAP Measures are not a measurement of our financial performance or liquidity under Ind AS, Indian GAAP, IFRS or U.S. GAAP and should not be considered in isolation or construed as an alternative to cash flows, profit/(loss) for the years/period or any other measure of financial performance or as an indicator of our operating performance, liquidity, profitability or cash flows generated by operating, investing or financing activities derived in accordance with Ind AS, Indian GAAP, IFRS or U.S. GAAP. In addition, these Non-GAAP Measures are not standardized terms, hence a direct comparison of these Non-GAAP Measures between companies may not be possible. Other companies may calculate these Non-GAAP Measures differently from us, limiting its usefulness as a comparative measure. Although such Non-GAAP Measures are not a measure of performance calculated in accordance with applicable accounting standards. We compute and disclose such Non-GAAP Measures and such other statistical information relating to our operations and financial performance as we consider such information to be useful measures of our business and financial performance. For the risks relating to our Non-GAAP Measures, see "Risk Factors - This Draft Red Herring Prospectus contains certain Non-GAAP financial measures and certain other selected statistical information related to our operations and financial performance. These Non-GAAP Measures and statistical information may vary from any standard methodology that is applicable across the pre-engineered steel buildings industry, and therefore may not be comparable with financial or statistical information of similar nomenclature computed and presented by other manufacturing companies."on page 65.

Particulars	As at and for the Financial Year ended March 31, 2021	As at and for the Financial Year ended March 31, 2022	As at and for the Financial Year ended March 31, 2023	As at and for the six months ended September 30, 2023
Revenue from	5,760.64	8,349.43	11,239.26	5,915.28
operations (1) (in million)
Total Income (in million)	5,835.43	8,408.57	11,363.92	5,984.56
EBITDA(2) (in million)	110.44	328.89	1,063.80	441.10
EBITDA margin (3) (%)	1.92	3.94	9.47	7.46
Total equity (in million)	2,996.59	3,183.19	3,992.79	3,911.62
Net Debt to EBITDA (4) (Ratio)	0.11	(0.98)	(0.38)	(0.76)*
Net Debt to Equity (5) (Ratio)	0.00	(0.10)	(0.10)	(0.09)
Return on Capital Employed (6) (%)	3.21	8.30	26.75	11.76*
Restated profit for the year/period (in million)	64.37	171.33	814.63	345.74

 

Particulars	As at and for the Financial Year ended March 31, 2021	As at and for the Financial Year ended March 31, 2022	As at and for the Financial Year ended March 31, 2023	As at and for the six months ended September 30, 2023
Profit Margin(7) (%)	1.12	2.05	7.25	5.84
Total non-current assets (in million)	2,062.77	1,902.09	2,113.07	2,235.06
Total current assets (in million)	2,627.49	3,535.45	4,637.18	4,760.91
Total assets (in million)	4,690.26	5,437.54	6,750.25	6,995.97
Net cash generated from operating activities(8) (in million)	388.32	261.80	312.86	560.21
Return on equity(9) (%)	2.15	5.38	20.40	8.84*

*Not annualized

(1) Revenue from operations is revenue from pre-engineered building contracts, sale of building materials, scrap sales and other operating services for the year/ period.

(2) EBITDA is calculated as restated profit plus total tax expense, finance costs, depreciation and amortization expense less other income for the year/period.

(3) EBITDA margin represents the EBITDA divided by the revenue from operations. ⁽⁴⁾ Net Debt to EBITDA ratio is computed as Net Debt divided by EBITDA.

(5) Net Debt to Equity ratio is computed as Net debt divided by the total equity.

(6) Return on capital employed (%) is calculated as EBIT divided by capital employed.

(7) Profit Margin is calculated at restated profit for the year/ period divided by revenue from operations. ⁽⁸⁾ Net cash generated from operating activities by the Company during the year/period.

(9) Return on equity is calculated as restated profit for the year/period divided by total equity.

Reconciliation of Non-GAAP measures

Reconciliation for the following Non-GAAP Measures included in this Draft Red Herring Prospectus, are as set out below.

Reconciliation of Restated profit for the year/period to EBITDA, EBITDA Margin and Profit Margin

(in million, except percentages)

	For the Financial Year ended March 31,			For six months
Particulars	2021	2022	2023	ended September 30, 2023
Restated profit for the year/period (A)	64.37	171.33	814.63	345.74
Total income tax expenses (B)	14.31	54.58	274.90	115.70
Finance costs (C)	19.34	44.55	25.96	10.03
Depreciation and amortization expense (D)	87.21	117.57	72.97	38.91
Other income (E)	74.79	59.14	124.66	69.28
EBITDA (F = A+B+C+D-E)	110.44	328.89	1,063.80	441.10
Revenue from operations (G)	5,760.64	8,349.43	11,239.26	5,915.28
EBITDA Margin (%) (H = F/G*100)	1.92	3.94	9.47	7.46
Profit Margin (%)(I = A/G*100)	1.12	2.05	7.25	5.84

Reconciliation of Non-current Borrowings to Total Debt and Capital Employed

(in million)

	As at the Financial Year ended March 31,			As at the six months
Particulars	2021	2022	2023	ended September 30, 2023
Non-current Borrowings (A)	1.26	10.19	11.06	8.61
Non-current Lease liabilities (B)	38.87	41.48	57.77	54.86
Current Borrowings (C)	18.28	23.42	102.78	28.79
Current Lease liabilities (D)	3.10	3.38	5.67	5.83
Total Debt (E=A+B+C+D)	61.51	78.47	177.28	98.09
Total equity (F)	2,996.59	3,183.19	3,992.79	3,911.62
Intangible assets (G)	1.78	1.32	0.38	1.95
Capital Employed (H = E+F-G)	3,056.32	3,260.34	4,169.69	4,007.76

Reconciliation of Restated profit for the year/period to EBIT, Capital Employed and Return on Capital Employed

	(in million, except percentage )
	As at/ for the Financial Year ended March 31,			As at/ for the six months ended September 30, 2023
Particulars	2021	2022	2023
Restated profit for the year/period (A)	64.37	171.33	814.63	345.74
Total tax expenses (B)	14.31	54.58	274.90	115.70
Finance costs (C)	19.34	44.55	25.96	10.03
EBIT (D = A+B+C)	98.02	270.46	1,115.49	471.47
Capital Employed (E)	3,056.32	3,260.34	4,169.69	4,007.76
Return on Capital Employed (%) (F= D/E*100)	3.21	8.30	26.75	11.76

Reconciliation of Total equity to Return on Equity

	(in million, except percentages)
Particulars	As at/for the Financial Year ended March 31,			As at/for the six months ended
	2021	2022	2023	September 30, 2023
Total equity (A)	2,996.59	3,183.19	3,992.79	3,911.62
Restated profit for the year/ period (B)	64.37	171.33	814.63	345.74
Return on Equity (%) (C = B/A*100)	2.15	5.38	20.40	8.84

Reconciliation of Cash and cash equivalent to Total Debt, Net Debt, Net Debt to Equity Ratio and Net Debt to EBITDA Ratio

Particulars	As at/ for the Financial Year ended March 31,			(in million, except ratios) As at/ for the six
	2021	2022	2023	months ended September 30, 2023
Cash and cash equivalents (A)	49.86	401.05	586.63	431.43
Total Debt (B)	61.51	78.47	177.28	98.09
Net Debt (C = A-B)	11.65	(322.58)	(409.35)	(333.34)
Total equity (D)	2,996.59	3,183.19	3,992.79	3,911.62
Net Debt/Equity Ratio (E = C/D)	0.00	(0.10)	(0.10)	(0.09)
EBITDA (F)	110.44	328.89	1,063.80	441.10
Net Debt/EBITDA Ratio (G = C/F)	0.11	(0.98)	(0.38)	(0.76)

Reconciliation of Total assets to Average Total assets and Asset Turnover Ratio

			(in million, except ratios)
Particulars	As at/ for the Financial Year ended March 31,			As at/ for the six months ended
	2021	2022	2023	September 30, 2023
Total assets at the beginning of the year/ period (A)	4,892.23	4,690.26	5,437.54	6,750.25
Total assets at the end of the year/ period (B)	4,690.26	5,437.54	6,750.25	6,995.97
Average Total Assets (C = Average of A and B)	4,791.24	5,063.90	6,093.90	6,873.11
Revenue from operations (D)	5,760.64	8,349.43	11,239.26	5,915.28
Asset Turnover Ratio (E = D/C)	1.20	1.65	1.84	0.86

Reconciliation of Revenue from operations to Average Inventories, Inventories Days, Average Trade Receivables, Trade Receivables Days, Average Trade Payables, Trade Payables days and Cash Conversion Cycle

Particulars	As at/ for the Financial Year ended March 31,			in million, except days) As at/ for the six months ended September 30,
	2021	2022	2023	2023
Revenue from operations (A)	5,760.64	8,349.43	11,239.26	5,915.28
Inventories at the beginning of the year/ period (B)	1,142.12	979.18	1,341.28	1,369.76
Inventories at the end of the year/ period (C)	979.18	1,341.28	1,369.76	1,640.50
Average Inventories (D = Average of B and C)	1,060.65	1,160.23	1,355.52	1,505.13
Inventories Days (E = C/A*365/183)	67.20	50.72	44.02	46.56
Trade Receivables at the beginning of the year/ period (F)	1,396.10	1,020.11	1,136.52	1,970.78
Trade Receivables at the end of the year/ period (G)	1,020.11	1,136.52	1,970.78	1,562.57
Average Trade Receivables (H = Average of F and G)	1,208.11	1,078.32	1,553.65	1,766.68
Trade Receivables Days (I = H/A*365/183)	76.55	47.14	50.46	54.66
Trade Payables at the beginning of the year/ period (J)	885.65	703.98	804.59	1,036.60
Trade Payables at the end of the year/ period (K)	703.98	804.59	1,036.60	1,140.88
Average Trade Payables (L = Average of J and K)	794.82	754.29	920.60	1,088.74
Trade Payables Days (M = L/A*365/183)	50.36	32.97	29.90	33.68
Cash Conversion Cycle Days (N = E+I-M)	93.39	64.89	64.58	67.54

PRINCIPAL COMPONENTS OF INCOME AND EXPENDITURE

Income

Our total income consists of revenue from operations and other income. The following table sets out our revenue from operations and other income:

Particulars	Financial Year ended March 31, 2021	Financial Year ended March 31, 2022	Financial Year ended March 31, 2023	Six months ended September 30, 2023
Revenue from operations (A) (in million)	5,760.64	8,349.43	11,239.26	5,915.28
Revenue from contracts with customers
- Revenue from Pre- engineered building contracts (in million)	4,290.38	7,213.41	9,861.37	4,736.14
Percentage of revenue from operations (%) Sale of products	74.48	86.39	87.74	80.07
- Building materials (in million)	1,329.03	937.57	1,204.34	1,096.66
Percentage of revenue from operations (%)	23.07	11.23	10.72	18.54
Other operating revenue
- Scrap Sales (in million)	86.24	144.63	165.55	74.21
- Other services (in million)	54.99	53.82	8.00	8.27

 

Particulars	Financial Year ended March 31, 2021	Financial Year ended March 31, 2022	Financial Year ended March 31, 2023	Six months ended September 30, 2023
Percentage of revenue from operations (%)	2.45	2.38	1.54	1.39
Other income (B) (in million)	74.79	59.14	124.66	69.28
TOTAL INCOME (A+B) (in million)	5,835.43	8,408.57	11,363.92	5,984.56

Revenue from operations. Revenue from operations comprises revenue from pre-engineered building contracts, sale of products and other operating revenue.

Revenue from contracts with customers comprises revenue from PEB Contracts, wherein we provide complete PEBs on a turn-key basis to our customers, and as a part of which, we also provide on-site project management capabilities for the installation and erection of PEBs supplied by us at the customers sites.

Revenue from sale of products comprises revenues from sale of building materials, which comprise (i) sale of metal ceilings and corrugated roofing comprising of metal suspended ceiling systems (under the brand,

"TRAC^?"), metal roofing and cladding systems (under the brand, "TRACDEK^?") and permanent/metal decking (lost shuttering) over steel framing (under the brand, "TRACDEK^? Bold-Rib"); (ii) supply of PEBs (wherein we supply complete PEB steel structures (comprising, amongst other things, primary and secondary framing systems; as well as entire PEBs, such as non-industrial PEB buildings for non-industrial use, such as farmhouses and residential buildings (under the brand, "Interarch Life")) for erection and installation by third party builders/erectors, (iii) LGFS, and (iv) bought out items.

Other operating revenue comprises scrap sales and other services, which includes revenue generated from design and engineering services provided by us towards PEB Contracts.

Other Income. Other income comprises interest income from bank deposits, income tax refund and others, rental income on investment properties and others, bad debts recovered, net gain on disposal of property, plant and equipment, net gain on sale of investment properties such as immovable properties situated in Pantnagar, Uttarakhand, India, government grants and miscellaneous income, liabilities no longer required written back (net).

Expenses

Our total expenses comprise cost of raw materials and components consumed, changes in inventories of finished goods and work-in-progress, employee benefits expenses, finance costs, depreciation and amortization expenses and other expenses. The following table sets out our total expenses from continuing operations:

Particulars	Financial Year ended March 31, 2021	Financial Year ended March 31, 2022	Financial Year ended March 31, 2023	Six months ended September 30, 2023
Cost of raw material and components consumed (in million)	3,551.18	5,694.36	7,427.33	3,952.59
Percentage of revenue from operations (%)	61.65	68.20	66.08	66.82
Changes in inventories of finished goods and work-in-progress (in million)	71.89	(45.91)	(102.50)	(214.79)
Percentage of revenue from operations (%)	1.25	(0.55)	(0.91)	(3.63)
Employee benefits expense (in million)	795.35	892.22	933.63	552.99
Percentage of revenue from operations (%)	13.81	10.69	8.31	9.35
Finance cost (in million)	19.34	44.55	25.96	10.03
Percentage of revenue from operations (%)	0.34	0.53	0.23	0.17
Depreciation and amortization expense (in million)	87.21	117.57	72.97	38.91

 

Particulars	Financial Year ended March 31, 2021	Financial Year ended March 31, 2022	Financial Year ended March 31, 2023	Six months ended September 30, 2023
Percentage of revenue from operations (%)	1.51	1.41	0.65	0.66
Other expenses (in million)	1,231.78	1,479.87	1,917.00	1,183.39
Percentage of revenue from operations (%)	21.38	17.72	17.06	20.01
Total expenses (in million)	5,756.75	8,182.66	10,274.39	5,523.12

Cost of raw material and components consumed. Cost of raw materials and components consumed consists of expenses incurred towards procurement of raw materials and components we use to manufacture PEBs, primarily steel in various descriptions and thickness i.e., hot rolled plates, galvanized steel coil sheets, sheeting coils, hot rolled sections.

Changes in inventories of finished goods and work-in-progress. Changes in inventories of finished goods and work-in-progress represent the costs attributable to the difference in inventories at the start of the Financial Year and the end of the Financial Year.

Employee benefit expenses. Employee benefit expenses consists of salaries, wages, allowance and bonus; contributions to provident and other funds; gratuity expenses; and staff welfare expenses.

Finance costs. Finance costs comprises interest on cash credit and vehicle loans from banks, others (includes interest accrued on income tax, lease liabilities and processing fees paid to lenders and provision of guarantee charges for issuances of guarantees by the Promoters. Other finance cost primarily relates to processing charges paid to the banks for working capital loans availed by our Company.

Depreciation and amortization expenses. Depreciation and amortization expenses consists of depreciation on property, plant and equipment, depreciation on investment properties, amortization of intangible assets and depreciation on right of use assets. Depreciation is calculated using the straight-line method based over the estimated useful life of the assets, as per which certain items of building, vehicle are being depreciated over useful lives different from the prescribed useful lives under Schedule II to the Companies Act, 2013, in order to reflect fair approximation of the period over which the assets are likely to be used.

Other expenses. Other expenses primarily consist of job work and installation charges paid to the empanelled builders/erectors, equipment hire and site charges, consumption of stores, spares and packaging materials, power and fuel expenses, freight and forwarding charges, rates and taxes, insurance expenses, repair and maintenance expenses, expenditure on corporate social responsibility, advertising and sales promotion expenses, commission to agents (other than of selling agents), travelling and conveyance expenses, communication costs, printing and stationary expenses, legal and professional fees, payments to auditors, net loss on foreign currency transactions, expenses on rent, net of bad debts/advances written off (less provision for doubtful debts and advances adjusted), allowances for doubtful debts and advances, donations made, testing expenses, bank charges and security service expenses.

TAX EXPENSES

Our tax expense represents the tax payable on the taxable income in the years/period based on the applicable income tax rate adjusted by income tax payable for earlier years and deferred tax charges or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the years/period). Tax expense on total income for the Financial Years ended March 31, 2021, March 31, 2022 and March 31, 2023 and six months ended September 30, 2023 amounted to 14.31 million, 54.58 million, 274.90 million and 115.70 million, respectively.

Deferred tax charges or credits and the corresponding deferred tax liabilities or assets are recognized using the tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled or the asset realized. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized. Deferred tax is reviewed at each balance sheet date and written down or written up to reflect the amount that is reasonably certain, as the case may be, to be realized.

412

OUR RESULTS OF OPERATIONS

The following table sets out select financial information derived from our restated statement of profit and loss for the Financial Years 2021, 2022 and 2023 and for six months ended September 30, 2023 and, the components of which are also expressed as a percentage of total income for such years/ period:

	Financial Year ended March 31, 2021		Financial Year ended March 31, 2022		Financial Year ended March 31, 2023		Six months ended September 30, 2023
	(in million)	(% of Total Income)	(in million)	(% of Total Income)	(in million)	(% of Total Income)	(in million)	(% of Total Income)
Income:
Revenue from operations	5,760.64	98.72	8,349.43	99.30	11,239.26	98.90	5,915.28	98.84
Revenue from contracts with customers
- Revenue from Pre- engineered building contracts	4,290.38	73.52	7,213.41	85.79	9,861.37	86.78	4,736.14	79.14
Sale of products
- Building materials	1,329.03	22.78	937.57	11.15	1,204.34	10.60	1,096.66	18.32
Other operating revenue
- Scrap Sales	86.24	1.48	144.63	1.72	165.55	1.46	74.21	1.24
- Other services	54.99	0.94	53.82	0.64	8.00	0.07	8.27	0.14
Other income	74.79	1.28	59.14	0.70	124.66	1.10	69.28	1.16
Total Income	5,835.43	100.00	8,408.57	100.00	11,363.92	100.00	5,984.56	100.00
Expenses:
Cost of raw material and components consumed	3,551.18	60.86	5,694.36	67.72	7,427.33	65.36	3,952.59	66.05
Changes in inventories of finished goods and work in progress	71.89	1.23	(45.91)	(0.55)	(102.50)	(0.90)	(214.79)	(3.59)
Employee benefits expense	795.35	13.63	892.22	10.61	933.63	8.22	552.99	9.24
Finance costs	19.34	0.33	44.55	0.53	25.96	0.23	10.03	0.17
Depreciation and amortisation expense	87.21	1.49	117.57	1.40	72.97	0.64	38.91	0.65
Other Expenses	1,231.78	21.11	1,479.87	17.60	1,917.00	16.87	1,183.39	19.77
Total expenses	5,756.75	98.65	8,182.66	97.31	10,274.39	90.41	5,523.12	92.29
Restated profit before tax	78.68	1.35	225.91	2.69	1,089.53	9.59	461.44	7.71
Tax expense
Current tax	41.52	0.71	92.80	1.10	232.34	2.04	144.01	2.41
Adjustment of income tax relating to earlier years (net)	(2.83)	(0.05)	1.63	0.02	5.29	0.05	(0.87)	0.01
Deferred tax charge/(credit)	(24.38)	(0.42)	(38.53)	(0.46)	42.01	0.37	(27.44)	(0.46)
Deferred tax charge/(credit) for the earlier year	-	-	(1.32)	(0.02)	(4.74)	(0.04)	-	-
Total income tax expense	14.31	0.25	54.58	0.65	274.90	2.42	115.70	1.93
Restated profit for the year/ period	64.37	1.10	171.33	2.04	814.63	7.17	345.74	5.78

Financial Year 2023 compared to Financial Year 2022

Total Income

Our total income increased by 35.15% to 11,363.92 million for the Financial Year 2023 from 8,408.57 million for the Financial Year 2022, primarily due to increase in our revenue from operations.

Revenue from Operations: Revenue from operations increased by 2,889.83 million or 34.61% to 11,239.26 million for the Financial Year 2023 from 8,349.43 million for the Financial Year 2022, primarily due to an increase in revenue generated from pre-engineered building contracts and sale of products which were higher due to growth in our order book, expanding our sales and marketing presence in West Bengal and Telangana and diversification into new sectors/industries. The following table sets forth the breakdown in our revenue from operations for Financial Years 2023 and 2022:

Particulars	Financial Year ended March 31, 2023		Financial Year ended March 31, 2022
	(in million)	(% of Total Income)	(in million)	(% of Total Income)
Revenue from operations Revenue from contracts with customers	11,239.26	98.90	8,349.43	99.30
- Revenue from Pre- engineered building contracts Sale of products	9,861.37	86.78	7,213.41	85.79
- Building materials Other operating revenue	1,204.34	10.60	937.57	11.15
- Scrap Sales	165.55	1.46	144.63	1.72
- Other services	8.00	0.07	53.82	0.64

Sale of Products: Our revenue from sale of products (i.e., sale of building materials), as per Ind AS 115 read with

SEBI ICDR Regulations, increased by 266.77 million or 28.45% to 1,204.34 million for Financial Year 2023 from 937.57 million for Financial Year 2022, primarily attributable to the categories set forth below:

Particulars	Financial year ended March 31, 2023		Financial year ended March 31, 2022		Percentage Increase/ (Decrease)
	Revenue from operations (in million)	% of sale of products	Revenue from operations (in million)	% of sale of products
Metal ceilings and corrugated roofing	287.95	23.91	235.52	25.12	(1.21)
Steel structure	821.11	68.18	596.12	63.58	4.60
Light gauge framing system	4.28	0.36	16.77	1.79	(1.43)
Bought out items	91.00	7.56	89.16	9.51	(1.95)
Sale of products	1,204.34	100.00	937.57	100.00	-

Other operating revenue: Other operating revenue decreased by 24.90 million or 12.55% to 173.55 million for the Financial Year 2023 from 198.45 million for the Financial Year 2022 primarily due to decrease in other services to 8.00 million for the Financial Year 2023 from 53.82 million for the Financial Year 2022. This was partially offset by increase in scrap sales to 165.55 million for the Financial Year 2023 from 144.63 million for the Financial Year 2022 on account of sale of 8.97 million of waste material resulting from floods in Uttarakhand.

Other Income: Other income increased by 110.79% to 124.66 million for the Financial Year 2023 from 59.14 million for the Financial Year 2022, primarily due an increase in (i) interest income from bank deposits to 56.50 million for the Financial Year 2023 from 29.51 million for the Financial Year 2022 due to increase in cash accruals from revenue from operations, (ii) 44.87 million net provision for doubtful debts/ advances written back in Financial Year 2023; (iii) rental income on investment properties to 13.54 million for the Financial Year

2023 from 12.19 million for the Financial Year 2022, (iv) recovery of bad debts to 5.07 million for the Financial Year 2023 from 1.59 million for the Financial Year 2022, and (v) net gain on disposal of property, plant and equipment to 1.09 million for the Financial Year 2023 from 0.83 million for the Financial Year 2022. This was partially offset by decrease in (a) interest income on income tax refund to 0.23 million for the Financial Year 2023 from 2.49 million for the Financial Year 2022, (b) interest income on loans given to employees and interest accrued on recovery from customers to 0.69 million for the Financial Year 2023 from

0.70 million for the Financial Year 2022, (c) rental income from moveable assets to 1.80 million for the Financial Year 2023 from 2.21 million for the Financial Year 2022, and (d) net gain on sale of investment properties to 0.62 million for the Financial Year 2023 from 9.47 million for the Financial Year 2022 due to sale of immoveable property situated at Pantnagar, Uttarakhand, India in Financial Year 2022.

Expenses

Our total expenses increased by 2,091.73 million or 25.56% to 10,274.39 million for the Financial Year 2023 from 8,182.66 million for the Financial Year 2022, primarily due to increase in cost of raw material and components consumed, employee benefit expenses and other expenses, which was partially offset by decrease in changes in inventories of finished goods and work in progress, finance cost and depreciation and amortization expense.

Cost of raw material and components consumed: Cost of raw material and components consumed increased by

1,732.97 million or 30.43% to 7,427.33 million for the Financial Year 2023 from 5,694.36 million for the

Financial Year 2022, primarily due to an increase in revenue generated from pre-engineered building contracts to 9,861.37 million for the Financial Year 2023 from 7,213.41 million for the Financial Year 2022 as a result of growth in our order book, establishment of sales and marketing offices in West Bengal and Telangana and diversification into new sectors/ industries.

Changes in inventories of finished goods and work in progress: Changes in inventories of finished goods and work in progress decreased by 56.59 million or 123.26% to 102.50 million for the Financial Year 2023 from 45.91 million for the Financial Year 2022, primarily due to increase in (i) sale of semi-finished goods to 238.33 million for the Financial Year 2023 from 190.47 million for the Financial Year 2022, (ii) sale of work in progress products to 202.13 million for the Financial Year 2023 from 149.64 million for the Financial Year 2022, and (iii) scrap sales to 3.56 million for the Financial Year 2023 from 1.35 million for the Financial Year 2022. This was partially offset by decrease in sale of finished goods to 1.90 million for the Financial Year 2023 from 1.96 million for the Financial Year 2022.

Employee benefit expenses: Employee benefit expenses increased by 41.41 million or 4.64% to 933.63 million for the Financial Year 2023 from 892.22 million for the Financial Year 2022, primarily due to an increase in (i) salaries, wages, allowances and bonus to 800.20 million for the Financial Year 2023 from 771.88 million for the Financial Year 2022, (ii) contribution to provident fund and other funds to 62.70 million for the Financial Year 2023 from 60.97 million for the Financial Year 2022, (iii) gratuity expenses to 34.22 million for the Financial Year 2023 from 31.31 million for the Financial Year 2022, and (iv) staff welfare expenses to 36.51 million for the Financial Year 2023 from 28.06 million for the Financial Year 2022 due to annual increments of employees.

Finance cost: Finance cost decreased by 18.59 million or 41.73% to 25.96 million for the Financial Year 2023 from 44.55 million for the Financial Year 2022. This decrease in finance cost is primarily attributable to decrease in (i) interest on cash credit and vehicle loans from banks to 3.03 million for the Financial Year 2023 from 5.32 million for the Financial Year 2022, (ii) interest accrued on income tax to 1.88 million for the Financial Year 2023 from 1.24 million for the Financial Year 2022 due to receipt of income tax refund and interest thereon,

(iii) others such as processing fees paid to lenders to 0.97 million for the Financial Year 2023 from 21.42 million for the Financial Year 2022, and (iv) commission paid to bank for issuance of bank guarantee to 0.06 million for the Financial Year 2023 from 0.09 million for the Financial Year 2022. This was partially offset by increase in (a) interest on lease liabilities to 6.18 million for the Financial Year 2023 from 4.12 million for the

Financial Year 2022, and (ii) other finance cost such as processing charges paid to the banks for enhancement of working capital facilities availed by our Company to 13.84 million for the Financial Year 2023 from 12.36 million for the Financial Year 2022.

Depreciation and amortization expense: Our depreciation and amortization expense decreased by 44.60 million or by 37.93% to 72.97 million for the Financial Year 2023 from 117.57 million for the Financial Year 2022.

The decrease reflects the depreciated value of assets for the period.

Other Expenses: Other expenses increased by 437.13 million or 29.54% to 1,917.00 million for the Financial Year 2023 from 1,479.87 million for the Financial Year 2022 primarily due to (i) increase in job work and installation charges to 1,130.02 million for the Financial Year 2023 from 785.42 million for the Financial Year

2022 due to increase in order value and outsourcing of a portion of PEBs; (ii) increase in consumption of store, spares and packing material to 206.39 million for the Financial Year 2023 from 173.20 million for the Financial

Year 2022 due to an increase in production of PEBs; (iii) increase in power and fuel expenses to 64.59 million for the Financial Year 2023 from 58.71 million for the Financial Year 2022; (iv) increase in freight and transportation charges to 217.86 million for the Financial Year 2023 from 152.13 million for the Financial

Year 2022 due to an increase in production of PEBs and cost of fuel; (v) increase in travelling and conveyance expenses to 49.70 million for the Financial Year 2023 from 21.87 million for the Financial Year 2022 due to increase in travel activity during Financial Year 2023 pursuant to relaxations of Covid-19 restrictions; (vi) increase

415 in legal and professional fees to 56.26 million for the Financial Year 2023 from 30.55 million for the Financial

Year 2022; and (vii) increase in bad debts/advances written off (net) to 81.48 million for the Financial Year 2023 from 35.50 million for the Financial Year 2022 (less provision for doubtful debts and advances adjusted out of above, which increased to (55.65) million for the Financial Year 2023 from (26.27) million for the

Financial Year 2022). However, such increase in expenses were offset by a decrease in expenses towards (a) rates and taxes to 2.45 million in Financial Year 2023 from 20.01 million in Financial Year 2022 due to payment of demand towards sales tax amounting to 17.81 million in Financial Year 2022; (b) insurances expenses to 3.76 million in Financial Year 2023 from 4.33 million in Financial Year 2022; (c) equipment hire and site charges to 32.40 million in Financial Year 2023 from 43.37 million in Financial Year 2022; and (d) repairs and maintenance charges to 33.92 million in Financial Year 2023 from 39.85 million in Financial Year 2022 which consisted of (A) charges on plant and machinery to 6.15 million in Financial Year 2023 from 7.23 million in Financial Year 2022, (B) charges on building to 10.21 million in Financial Year 2023 from 17.78 million in Financial Year 2022, and (C) charges on others such as office equipment, furniture and fittings to 17.56 million in Financial Year 2023 from 14.84 million in Financial Year 2022.

Restated Profit before tax

For the reasons discussed above, our restated profit before tax was 1,089.53 million in Financial Year 2023 compared to 225.91 million in Financial Year 2022.

Tax Expense

Current tax expenses increased to 232.34 million in Financial Year 2023 from 92.80 million in Financial Year 2022 and deferred tax charge increased to a credit of 42.01 million in Financial Year 2023 from a debit of

(38.53) million in Financial Year 2022.

Restated Profit for the year

For the various reasons discussed above, we reported a profit for the year of 814.63 million for the Financial Year 2023 as compared to a reported profit for the year of 171.33 million for the Financial Year 2022.

Financial Year 2022 compared to Financial Year 2021

Total Income

Our total income increased by 44.10% to 8,408.57 million for the Financial Year 2022 from 5,835.43 million for the Financial Year 2021, primarily due to increase in our revenue from operations.

Revenue from Operations: Revenue from operations increased by 2,588.79 million or 44.94% to 8,349.43 million for the Financial Year 2022 from 5,760.64 million for the Financial Year 2021, primarily due to an increase in revenue generated from pre-engineered building contracts which were higher due to an increase in production volume due to the recovery from the Covid-19 pandemic and increase in our order book and was partially set off by decrease in sale of products. The following table sets forth the breakdown in our revenue from operations for Financial Years 2022 and 2021:

Particulars	Financial Year ended March 31, 2022		Financial Year ended March 31, 2021
	(in million)	(% of Total Income)	(in million)	(% of Total Income)
Revenue from operations Revenue from contracts with customers	8,349.43	99.30	5,760.64	98.72
- Revenue from Pre- engineered building contracts Sale of products	7,213.41	85.79	4,290.38	73.52
- Building materials	937.57	11.15	1,329.03	22.78
Other operating revenue
- Scrap Sales	144.63	1.72	86.24	1.48
- Other services	53.82	0.64	54.99	0.94

Sale of Products: Our revenue from sale of products (i.e., sale of building materials), as per Ind AS 115 read with SEBI ICDR Regulations, decreased by 391.46 million or 29.45% to 937.57 million for the Financial Year 2022 from 1,329.03 million for the Financial Year 2021, primarily attributable to the categories set forth below:

Particulars	Financial year ended March 31, 2022		Financial year ended March 31, 2021		Percentage Increase/ (Decrease)
	Revenue from operations (in million)	% of sale of products	Revenue from operations (in million)	% of sale of products
Metal ceilings and corrugated roofing	235.52	25.12	363.94	27.38	(2.26)
Steel structure	596.12	63.58	866.99	65.23	(1.65)
Light gauge framing system	16.77	1.79	6.71	0.50	1.29
Bought out items	89.16	9.51	91.39	6.88	(2.63)
Sale of products	937.57	100.00	1,329.03	100.00	-

Other operating revenue: Other operating revenue increased by 57.22 million or 40.52% to 198.45 million for the Financial Year 2022 from 141.23 million for the Financial Year 2021 primarily due to increase in scrap sales to 144.63 million for the Financial Year 2022 from 86.24 million for the Financial Year 2021, due to an increase in production of PEBs leading to increase of production of scrap material. This was partially offset by decrease in other services by 1.17 million or 2.13% to 53.82 million for the Financial Year 2022 from 54.99 million for the Financial Year 2021, due to receipt of a customer order which only included designing and consultancy services.

Other Income: Other income decreased by 20.93% to 59.14 million for the Financial Year 2022 from 74.79 million for the Financial Year 2021, primarily due to decrease in (i) interest income from bank deposits to 29.51 million for the Financial Year 2022 from 31.59 million for the Financial Year 2021, (ii) rental income on investment properties to 12.19 million for the Financial Year 2022 from 12.55 million for the Financial Year 2021, and (iii) recovery of bad debts to 1.59 million for the Financial Year 2022 from 25.57 million for the

Financial Year 2021 since majority on bad debts were recovered by the Company in Financial Year 2021. This was partially offset by increase in (a) interest income on income tax refund to 2.49 million for the Financial Year 2022 from 0.04 million for the Financial Year 2021, (b) interest income on loans given to employees and interest accrued on recovery from customers to 0.70 million for the Financial Year 2022 from 0.67 million for the Financial Year 2021, (c) rental income on from moveable assets to 2.21 million for the Financial Year 2022 from 1.14 million for the Financial Year 2021, (d) net gain on disposal of property, plant and equipment to 0.83 million for the Financial Year 2022 from 0.75 million for the Financial Year 2021, and (e) net gain on sale of investment properties to 9.47 million for the Financial Year 2022 due to sale of immoveable property situated at Pantnagar, Uttarakhand, India in Financial Year 2022.

Expenses

Our total expenses increased by 2,425.91 million or 42.14% to 8,182.66 million for the Financial Year 2022 from 5,756.75 million for the Financial Year 2021, primarily due to increase in cost of raw material and components consumed, employee benefit expenses, finance cost, depreciation and amortization expense and other expenses, which was partially offset by decrease in changes in inventories of finished goods and work in progress.

Cost of raw material and components consumed: Cost of raw material and components consumed increased by

2,143.18 million or 60.35% to 5,694.36 million for the Financial Year 2022 from 3,551.18 million for the

Financial Year 2021, primarily due to an increase in revenue generated from pre-engineered building contracts to

7,213.41 million for the Financial Year 2022 from 4,290.38 million for the Financial Year 2021 which were higher due to an increase in production volume during the recovery from the Covid-19 pandemic and increase in order book and was partially offset by decrease in sale of building materials to 937.57 million for the Financial Year 2022 from 1,329.03 million for the Financial Year 2021 on account of decrease in (i) sale of metal ceilings and corrugated roofing to 235.52 million for the Financial Year 2022 from 363.94 million for the Financial Year 2021, (ii) sale of steel structure to 596.12 million for the Financial Year 2022 from 866.99 million for the Financial Year 2021, and (iii) sale of bought out items to 89.16 million for the Financial Year 2022 from

91.39 million for the Financial Year 2021 which was partially offset by increase in in sale of light gauge framing systems to 16.77 million for the Financial Year 2022 from 6.71 million for the Financial Year 2021.

Changes in inventories of finished goods and work in progress: Changes in inventories of finished goods and work in progress decreased by 117.80 million or 163.86% to (45.91) million for the Financial Year 2022 from 71.89 million for the Financial Year 2021, primarily due to decrease in (i) sale of finished goods to 1.96 million for the Financial Year 2022 from 2.44 million for the Financial Year 2021, (ii) work in progress products to 149.64 million for the Financial Year 2022 from 164.64 million for the Financial Year 2021, and (iii) scrap sales to 1.35 million for the Financial Year 2022 from 1.56 million for the Financial Year 2021. This was partially offset by increase in sale of semi-finished goods to 190.47 million for the Financial Year 2022 from

128.87 million for the Financial Year 2021.

Employee benefit expenses: Employee benefit expenses increased by 96.87 million or 12.18% to 892.22 million for the Financial Year 2022 from 795.35 million for the Financial Year 2021, primarily due to an increase in (i) salaries, wages, allowances and bonus to 771.88 million for the Financial Year 2022 from 686.87 million for the Financial Year 2021, (ii) contribution to provident fund and other funds to 60.97 million for the Financial Year 2022 from 55.70 million for the Financial Year 2021, (iii) gratuity expenses to 31.31 million for the Financial Year 2022 from 30.70 million for the Financial Year 2021, and (iv) staff welfare expenses to 28.06 million for the Financial Year 2022 from 22.08 million for the Financial Year 2021 due to the increase in number of our employees to1,825 as at March 31, 2022 from 1,582 as at March 31, 2021 and annual increments.

Finance cost: Finance cost increased by 25.21 million or 130.35% to 44.55 million for the Financial Year 2022 from 19.34 million for the Financial Year 2021. This increase in finance cost is primarily attributable to increase in (i) interest on cash credit and vehicle loans from banks to 5.32 million for the Financial Year 2022 from 1.54 million for the Financial Year 2021, (ii) interest on income tax to 1.24 million for the Financial Year 2022 from (5.56) million for the Financial Year 2021 due to receipt of income tax and interest thereon, (iii) interest on lease liabilities to 4.12 million for the Financial Year 2022 from 4.08 million for the Financial Year 2021, (iv) others such as processing fees paid to lenders to 21.42 million for the Financial Year 2022 from 3.79 million for the Financial Year 2021, and (v) commission paid to bank for issuance of bank guarantee to

0.09 million for the Financial Year 2022. This was partially offset by decrease in other finance cost such as processing charges paid to the banks for enhancement of working capital facilities availed by our Company to 12.36 million for the Financial Year 2022 from 15.49 million for the Financial Year 2021.

Depreciation and amortization expense: Our depreciation and amortization expense increased by 30.36 million or by 34.81% to 117.57 million for the Financial Year 2022 from 87.21 million for the Financial Year 2021.

The increase in depreciation and amortisation expenses was primarily due to brownfield expansion of Kichha Manufacturing Facility resulting in increase in depreciable assets.

Other Expenses: Other expenses increased by 248.09 million or 20.14% to 1,479.87 million for the Financial

Year 2022 from 1,231.78 million for the Financial Year 2021 primarily due to increase in (i) job work and installation charges to 785.42 million for the Financial Year 2022 from 701.26 million for the Financial Year

2021 due to increase in order value and outsourcing of production of a portion of our PEBs; (ii) consumption of store, spares and packing material to 173.20 million for the Financial Year 2022 from 139.35 million for the

Financial Year 2021 due to an increase in production volume of PEBs; (iii) power and fuel expenses to 58.71 million for the Financial Year 2022 from 44.39 million for the Financial Year 2021; (iv) freight and transportation charges to 152.13 million for the Financial Year 2022 from 125.91 million for the Financial

Year 2021 due to an increase in production volume and cost of fuel; (v) rates and taxes to 20.01 million in Financial Year 2022 from 2.97 million in Financial Year 2021 due to disallowance of previous input tax credit, (vi) insurances expenses to 4.33 million in Financial Year 2022 from 3.90 million in Financial Year 2021,

(vii) repairs and maintenance charges to 39.85 million in Financial Year 2022 from 22.72 million in Financial

Year 2021 which consisted of (A) charges on plant and machinery to 7.23 million in Financial Year 2022 from 4.79 million in Financial Year 2021, (B) charges on building to 17.78 million in Financial Year 2022 from

3.47 million in Financial Year 2021, and (C) charges on others such as office equipment, furniture and fittings to 14.84 million in Financial Year 2022 from 14.46 million in Financial Year 2021, (viii) advertising and sales promotion to 2.92 million in Financial Year 2022 from 1.62 million in Financial Year 2021, (ix) travelling and conveyance expenses to 21.87 million for the Financial Year 2022 from 14.69 million for the Financial

Year 2021 due to increased travel activity during Financial Year 2022 pursuant to relaxations of Covid-19 restrictions, (x) communication costs to 3.95 million for the Financial Year 2022 from 3.92 million for the

Financial Year 2021, (xi) printing and stationary expenses to 5.63 million for the Financial Year 2022 from 5.07 million for the Financial Year 2021, (xii) legal and professional fees to 30.55 million for the Financial Year

2022 from 21.48 million for the Financial Year 2021, (xiii) net of bad debts/ advances written off to 35.50 million for the Financial Year 2022 from 1.68 million for the Financial Year 2021, (xiv) allowances for doubtful debts and advances to 57.95 million for the Financial Year 2022 from 39.82 million for the Financial Year 2021, (xv) donation expenses to 0.02 million for the Financial Year 2022; (xvi) testing expenses to 1.03 million for the Financial Year 2022 from 0.99 million for the Financial Year 2021, (xvii) bank charges to 41.20 million for the Financial Year 2022 from 24.72 million for the Financial Year 2021, (xviii) security services expenses to 8.08 million for the Financial Year 2022 from 6.71 million for the Financial Year 2021. This was partially offset by decrease in equipment hire and site charges to 43.37 million for the Financial Year 2022 from 54.54 million for the Financial Year 2021.

Restated Profit before tax

For the reasons discussed above, our restated profit before tax was 225.91 million in Financial Year 2022 compared to 78.68 million in Financial Year 2021.

Tax Expense

Current tax expenses increased to 92.80 million in Financial Year 2022 from 41.52 million in Financial Year 2021 and deferred tax charge decrease to 38.53 million in Financial Year 2022 from 24.38 million in Financial

Year 2021.

Restated Profit for the year

For the various reasons discussed above, we reported a profit for the year of 171.33 million for the Financial Year 2022 as compared to a reported profit for the year of 64.37 million for the Financial Year 2021.

CASH FLOWS

The following table sets forth certain information relating to our cash generated from operations in the Financial Year 2021, Financial Year 2022, Financial Year 2023 and for the six months ended September 30, 2023:

	Financial Year ended March 31,	Financial Year ended March 31,	Financial Year ended March 31,	Six months ended September 30, 2023 (in
Particulars	2021 (in million)	2022 (in million)	2023 (in million)	million)
Net cash generated from operating activities	388.32	261.80	312.86	560.21
Net cash generated from/(used in) investing activities	(349.87)	90.81	(189.88)	(199.07)
Net cash (used in)/generated from financing activities	(34.78)	(1.42)	62.60	(516.34)
Net increase/(decrease) in cash and cash equivalents	3.67	351.19	185.58	(155.20)

Operating Activities

Six Months ended September 30, 2023

Cash generated from operations was 723.86 million for the six months ended September 30, 2023 and our operating profit before working capital changes was 499.00 million. The difference was primarily attributable to 270.74 million increase in inventories due to higher production, decrease in trade receivables by 367.86 million, 10.04 million increase in other financial assets and increase in other assets by 291.50 million. This was offset by 106.67 million increase in trade payables, increase by 266.40 million in other liabilities, increase by 26.50 million in provisions and increase in other financial liabilities by 29.71 million.

Financial Year 2023

Cash generated from operations was 510.63 million in Financial Year 2023 and our operating profit before working capital changes was 1,095.30 million. The difference was primarily attributable to 28.48 million increase in inventories due to higher production, increase in trade receivables by 819.46 million, increase in other assets by 131.83 million and decrease by 52.48 million in provisions. This was offset by 249.78 million increase in trade payables, increase by 185.20 million in other liabilities, increase by 9.21 million in other financial liabilities and decrease by 3.39 million in other financial assets.

Financial Year 2022

Cash generated from operations was 342.07 million in Financial Year 2022 and our operating profit before working capital changes was 402.28 million. The difference was primarily attributable to 362.10 million increase in inventories due to higher production, increase in trade receivables by 180.38 million, increase in other assets by 33.79 million and increase in other financial assets by 49.06 million. This was offset by 100.61 million increase in trade payables, increase by 451.20 million in other liabilities, increase in other financial liabilities by 11.89 million and increase by 1.42 million in provisions.

Financial Year 2021

Cash generated from operations was 403.05 million in Financial Year 2021 and our operating profit before working capital changes was 150.62 million. The difference was primarily attributable to 179.33 million decrease in trade payables, 13.40 million decrease in other financial liabilities, 33.12 million decrease in other liabilities, 162.94 million decrease in inventories. This was partially offset by 18.75 million increase in provisions, 73.80 million, increase in assets, 8.66 million decrease in other financial assets and increase in trade receivables by 361.73 million.

Investing Activities

Six Months ended September 30, 2023

Net cash used in investing activities for the six months ended September 30, 2023 was 199.07 million. This reflected (i) payment of 32.25 million towards purchase of property, plant and equipment and intangible assets due to routine expansion at our Manufacturing Facilities; (ii) payment of 68.02 million towards purchase of right to use assets which includes payment made to Andhra Pradesh Industrial Infrastructure Corporation Limited for the industrial land for setting up the Planned Andhra Pradesh Manufacturing Facility in the Industrial Park at Attivaram, Andhra Pradesh, India; (iii) 8.37 million loans given to employees; and (iv) 928.23 million of investment in bank deposits (having original maturity of more than three months). This was partially offset by (i)

1.58 million of proceeds from sale of property, plant and equipment; (ii) 4.33 million of loans repaid by employees; (iii) 52.13 million from interest received; and (iv) 779.76 million proceeds from bank deposits

(having original maturity of more than three months).

Financial Year 2023

Net cash used in investing activities for the Financial Year 2023 was 189.88 million. This reflected (i) payment of 136.48 million towards purchase of property, plant and equipment and intangible assets due to routine expansion at our Manufacturing Facilities and purchase of vehicles for employees; (ii) 50.02 million towards purchase of investments such as long-term debt mutual fund; (iii) 5.84 million loans given to employees; and (iv) 406.64 million of investment in bank deposits (having original maturity of more than three months). This was partially offset by (i) 2.67 million of proceeds from sale of property, plant and equipment; (ii) 6.45 million of loans repaid by employees; (iii) 2.34 million proceeds from sale of investment properties; (iv) 342.37 million of proceeds from bank deposits (having original maturity of more than three months); and (v) 55.27 million from interest received.

Financial Year 2022

Net cash from investing activities for the Financial Year 2022 was 90.81 million. This reflected (i) 1.79 million of proceeds from sale of property, plant and equipment; (ii) 8.20 million of loans repaid by employees; (iii) 23.68 million proceeds from sale of investment properties; (iv) 851.22 million of proceeds from bank deposits (having original maturity of more than three months); and (v) 32.78 million from interest received. This was partially offset by (i) payment of 38.72 million towards purchase of property, plant and equipment and intangible assets due to routine expansion at our Manufacturing Facilities and purchase of vehicles for employees; (ii) 8.95 million loans given to employees; and (iii) 779.19 million of investment in bank deposits (having original maturity of more than three months).

Financial Year 2021

Net cash used in investing activities for the Financial Year 2021 was 349.87 million. This reflected (i) 1.39 million proceeds from sale of property, plant and equipment; (ii) 3.07 million of loans repaid by employees; (iii)

269.75 million of proceeds from bank deposits (having original maturity of more than three months); (iv)

34.62 million from interest received. This was partially offset by (i) 52.02 million towards purchase of property, plant and equipment and intangible assets due to expansion of Kichha Manufacturing Facility; (ii) 3.69 million loans given to employees; (iii) 0.10 million purchase from sale of investment properties; and (iii) 602.89 million of investment in bank deposits (having original maturity of more than three months).

Financing Activities

Six Months ended September 30, 2023

Net cash used in financing activities in the six months ended September 30, 2023 was 516.34 million. This reflected (i) payment of 390.00 million towards payment for buy back of equity shares; (ii) payment of 42.81 million towards tax on buy back of equity shares; (iii) 2.84 million towards repayment of long-term borrowings; (iv) 73.60 million towards repayment of short-term borrowings; (v) 1.42 million towards interest paid; (vi) 2.92 million towards interest paid on lease liability; and (vii) 2.75 million towards payment of principal portion of lease liability.

Financial Year 2023

Net cash generated from financing activities in Financial Year 2023 was 62.60 million. This reflected (i) 7.71 million proceeds from long-term borrowings; and (ii) 77.44 million proceeds from short-term borrowings. This was partially offset by (i) 4.92 million towards repayment of long-term borrowings; (ii) 6.29 million towards interest paid; (iii) 6.18 million towards interest paid on lease liability; and (iii) 5.16 million towards payment of principal portion of lease liability.

Financial Year 2022

Net cash used in financing activities in the Financial Year 2022 was 1.42 million. This reflected (i) 6.77 million towards repayment of long-term borrowings; (ii) 8.51 million towards interest paid; (iii) 4.12 million towards interest paid on lease liability; and (iv) 2.86 million towards payment of principal portion of lease liability. This was partially offset (i) 14.13 million proceeds from long-term borrowings; and (ii) 6.71 million proceeds from short-term borrowings.

Financial Year 2021

Net cash used in financing activities in the Financial Year 2021 was 34.78 million. This reflected (i) 7.92 million towards repayment of long-term borrowings; (ii) 19.68 million towards repayment of short-term borrowings; (iii) 0.29 million towards interest paid; (iv) 4.08 million towards interest paid on lease liability; and (v) 2.81 million towards payment of principal portion of lease liability.

Financial Indebtedness

As at January 31, 2024, the aggregate amount of our financial indebtedness was 2,812.58 million which primarily consisted of working capital facilities. For further details related to our indebtedness, please see

" Financial Indebtedness" on page 381.

Contingent Liabilities

As at September 30, 2023, our contingent liabilities as per Ind AS 37 were as follows:

S. No.	Particulars	(in million) As at September 30, 2023
1.	Demands received from Sales tax authorities	153.87
2.	Demands raised by Income tax authorities	13.15
3.	Outstanding bank guarantees by the Company	736.50
4.	Demand raised by the Director of Town & Country Planning, Chennai, towards Infrastructure and Amenities	2.51
5.	Recovery suit filed by a vendor	16.99
6.	Pending labour cases	Liability not ascertainable
7.	Demand raised by Asstt. Labour Commissioner, Pantnagar (‘ALC), towards the wages of workers during the lockout period	18.50
8.	Demand raised by Pondur Panchayat towards non-payment of House Tax	1.39
9.	Demand received from Regional P.F. Commissioner, Haldwani towards assessment of PF dues related to job workers involved/engaged in job work by the Company or job work contractors, in connection with the work of the Company	3.43

Off-Balance Sheet Commitments and Arrangements

We do not have any off-balance sheet arrangements, derivative instruments or other relationships with other entities that would have been established for the purpose of facilitating off-balance sheet arrangements.

Capital Expenditure

Our capital expenditure comprises expenditure incurred towards property, plant & equipment, Intangible Assets and Right of Use Assets. For the six months ended September 30, 2023 and Financial Years 2023, 2022 and 2021, our capital expenditure amounted to 108.11 million, 131.50 million, 36.94 million and 141.97 million, respectively, incurred towards property, plant & equipment, Intangible Assets and Right of Use Assets.

Related party transactions

We have engaged in the past, and may engage in the future, in ordinary course of business, transactions with related parties including rent expenses, managerial remuneration. See "Other Financial Information Related party transactions" on page 378.

Quantitative and Qualitative Disclosures about Market Risk

In the course of our business activities, we are exposed to certain financial risks, namely market risks, credit risk and liquidity risk. The senior management of the Company oversees the management of these risks. The senior management of the Company is supported by an internal finance team that advises on financial risks and the appropriate financial risk governance framework for the Company. The internal finance team provides assurance to the Companys senior management that the Companys financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Companys policies and risk objectives. The Board of Directors review and agree policies for managing each of these risks, which are summarized below:

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits and investments.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companys exposure to the risk of changes in market interest rates relates primarily to the Companys short-term debt obligations with floating interest rates. The risks are managed by periodic monitoring of interest rates. Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Companys exposure to the risk of changes in foreign exchange rates relates primarily to the Companys foreign currency liabilities. The Company manages its foreign currency risk through a forecast of highly probable foreign currency cash flows. The Company is exposed to movement in price of steel commodity. Profitability of Company may get affected by movement in the prices of steel. The strategic move of the Company from fixed price contracts to variable price contracts helps mitigate steel price fluctuation risk. Equity price risk is the risk that the value of a equity financial instrument will fluctuate due to changes in market prices. The Company does not hold any quoted or marketable equity financial instruments, hence, is not exposed to any movement in market prices.

Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks, foreign exchange transactions and other financial instruments. The Company only deals with parties which has good credit rating/ worthiness given by external rating agencies or based on Companys internal assessment. The Companys exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including the default risk associated with the industry and location in which customers operate. The Company limits its exposure to credit risk from trade receivables by establishing a maximum payment period. Outstanding customer receivables are regularly monitored and any shipments to major customers are generally covered by letters of credit obtained from reputable banks.

Liquidity Risk

The Company monitors its risk of a shortage of funds using a liquidity planning tool. Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with its financial liabilities. The Company monitors its risk of a shortage of funds using a liquidity planning tool. The Companys objective is to maintain a balance between continuing of funding and flexibility through the use of bank overdrafts, bank loans, cash credits, and advance payment terms.

Unusual or Infrequent Events or Transactions

Except as described in this Draft Red Herring Prospectus, to our knowledge, there have been no unusual or infrequent events or transactions that have in the past or may in the future affect our business operations or future financial performance.

Significant Economic Changes and Known Trends or Uncertainties

Our business has been subject, and we expect it to continue to be subject, to significant economic changes arising from the trends identified in "- Significant Factors Affecting our Results of Operations" on page 385 and the uncertainties described in "Risk Factors" on page 30. To our knowledge, except as disclosed in this Draft Red Herring Prospectus, there are no known trends or uncertainties which we expect to have a material adverse effect on our income.

Future Relationship between Cost and Revenue

Other than as described in this section and "Risk Factors" and "Our Business" on pages 30 and 224, respectively, to our knowledge there are no known factors that may adversely affect our business prospects, results of operations and financial condition.

New Products or Business Segments

Other than as disclosed in this section and in "Our Business" on page 224, there are no new products or business segments that have or are expected to have a material impact on our business prospects, results of operations or financial condition.

Significant Dependence on Customers and Suppliers

While we do not significantly depend on a single customer or a single supplier, we are dependent on third party suppliers for the uninterrupted supply of key inputs and components including steel in various descriptions and thickness, including hot rolled plates, galvanized steel coil sheets, sheeting coils, hot rolled sections, bought outs and other consumables. A supply shortage may increase our costs if we are forced to pay higher prices for components or raw materials or both, or if we have to redesign or reconfigure products to accommodate a substitute component. When prices rise, they may impact our margins and results of operations if we are not able to pass the increases onto our customers or otherwise offset them.

For further information on our dependence on customers and suppliers, see "Risk Factors - We depend on third party suppliers for the uninterrupted supply of our raw materials and do not have continuing or exclusive arrangements with any of our suppliers. Loss of suppliers or any failure by our suppliers to make timely delivery of raw materials may have an adverse effect on our business, results of operations, financial condition and cash flows ." and "Risk Factors - We derive a significant portion of our revenues from repeat orders placed by our customers and customer groups (identified as customers forming part of the same corporate group) which we identify as orders placed by customers or customer groups (identified as customers forming part of the same corporate group) that have placed orders with our Company previously. Any loss of, or a significant reduction in the repeat orders received by us could adversely affect our business, results of operations, financial condition and cash flows." on pages31 and 32.

Segment Reporting

Our Company is involved in manufacturing, supply, erection and installation of pre- engineered buildings, metal roofing & cladding system and metal false ceilings. Considering the nature of Companys business and operations, there are no separate reportable segments (business and/or geographical) in accordance with the requirements of Ind AS 108 notified under Section 133 of Companies Act, 2013.

Seasonality of Business

Our revenues and results may be affected by seasonal factors. Further, some of our customers have businesses which are seasonal in nature and a downturn in demand for our products by such customers could reduce our revenue during such periods. Our operations may also be adversely affected by difficult working conditions during monsoon season. During periods of curtailed activity due to adverse weather conditions, we may continue to incur operating expenses, but our revenues from operations may be delayed or reduced. Although such adverse weather conditions do not typically have a material impact on our revenue from operations, abnormally rainy monsoon could have a material impact. Typically, our quarter wise net sales figures are lower during the monsoon quarter, i.e. June to September in comparison to the other quarters.

Competitive Conditions

We operate in a competitive environment. Please refer to "Our Business", "Industry Overview" and "Risk Factors" on pages 224, 168 and 30, respectively for further information on our industry and competition.

Recent Accounting Pronouncements

As of the date of this Draft Red Herring Prospectus, there are no recent accounting pronouncements, which would have a material effect on our financial condition or results of operations.

Significant developments subsequent to September 30, 2023

No circumstances have arisen since the date of the last financial statements disclosed in this Draft Red Herring Prospectus, which materially and adversely affect or are likely to affect, our trading, operations or profitability, or the value of our assets or our ability to pay our material liabilities within the next 12 months.