To The Members of DCM Shriram Limited
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of DCM Shriram Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2025, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year ended on that date, and notes to the financial statements, including a summary of material accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (the "Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2025, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing ("SA"s) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditors Responsibility for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India ("ICAI") together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIs Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
Sr. No. Key Audit Matter |
Auditors Response |
1. Capitalisation of Property, Plant and Equipment (PPE) related to projects The Company had various projects under implementation at the chemical and sugar businesses. During the year, the | Principal audit procedures performed: |
Company has capitalised PPE related to certain projects that were ready for its intended use as determined by the management and has started commercial production. | Our audit approach consisted evaluation of design and implementation of controls, and testing the operating effectiveness of controls related to capital expenditure and capitalization of assets. |
Inappropriate amount and timing of capitalization of the project could result in material misstatement of PPE with a consequent impact on depreciation charge and results for the year. We considered this to be a key audit matter due to significance of amount incurred on such items, judgement involved in determining the eligibility of costs; determining when the whole/partial project is ready for use as intended by the management and qualifies for capitalization as per the criteria set out in Ind AS 16 Property, Plant and Equipment. | We assessed the appropriateness of the accounting policy for property, plant and equipment as per the relevant accounting standard. |
(Refer to the accompanying notes 1.3(a), 1.4(i), 2.1 and 23 forming integral part of the standalone financial statements) | On a sample basis, we tested the source documentation to determine whether the cost incurred meets the criteria for capitalization as per Ind AS 16, appropriately classified and approved. |
We examined the useful life assessment made by the management based on their internal estimates and evaluation. | |
We physically verified existence of property, plant and equipment on test check basis through sites visit. |
|
We obtained the supporting calculations of borrowing costs capitalized for qualifying assets as per Ind AS 23, verified the inputs to the calculation and tested the arithmetical accuracy. | |
We obtained the commissioning certificate provided by the management and corroborated with underlying evidence to determine whether the asset is in the location and condition necessary for it to be capable of operating in the manner intended by the management. | |
Ensured adequacy of disclosures in the standalone financial statements. |
Information Other than the Financial Statements and Auditors Report Thereon
Responsibilities of Management and Board of Directors for the Standalone Financial Statements
The Companys Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including Ind AS specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management and Board of Directors are responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intend to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Companys Board of Directors is also responsible for overseeing the Companys financial reporting process.
Auditors Responsibility for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal financial controls that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
effectiveness of the Companys internal financial controls with reference to standalone financial statements.
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
As stated in note 51 to the standalone financial statements, the Board of Directors of the Company has proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. Such dividend proposed is in accordance with section 123 of the Act, as applicable.
ended March 31, 2025 which have the feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software systems. Further, during the course of our audit we did not come across any instance of the audit trail feature being tampered with and the audit trail has been preserved by the Company as per the statutory requirements for record retention.
For Deloitte Haskins & Sells
Chartered Accountants (Firms Registration No.015125N)
Vijay Agarwal
(Partner) (Membership No. 094468) UDIN: 25094468BMMIYK7494
Place: New Delhi Date: May 05, 2025
ANNEXURE "A" TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 1(f) under Report on Other Legal and Regulatory Requirements section of our report of even date)
Report on the Internal Financial Controls with reference to standalone financial statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls with reference to standalone financial statements of DCM Shriram Limited (the "Company") as at March 31, 2025, in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
Managements and Board of Directors Responsibilities for Internal Financial Controls
The Companys management and Board of Directors are responsible for establishing and maintaining internal financial controls with reference to standalone financial statements based on "the internal control with reference to standalone financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India". These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal financial controls with reference to standalone financial statements of the Company based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls with reference to standalone financial statements. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to standalone financial statements was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls with reference to standalone financial statements included obtaining an understanding of internal financial controls with reference to standalone financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the Companys internal financial controls with reference to standalone financial statements.
Meaning of Internal Financial Controls with reference to standalone financial statements
A companys internal financial control with reference to standalone financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control with reference to standalone financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with reference to standalone financial statements
Because of the inherent limitations of internal financial controls with reference to standalone financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to standalone financial statements to future periods are subject to the risk that the internal financial control with reference to standalone financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as at March 31, 2025, based on the criteria for internal financial control with reference to standalone financial statements established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For Deloitte Haskins & Sells
Chartered Accountants (Firms Registration No.015125N)
Vijay Agarwal
(Partner) (Membership No. 094468) UDIN: 25094468BMMIYK7494
Place: New Delhi Date: May 05, 2025
Annexure B to the Independent Auditors Report
(Referred to in paragraph 2 under Report on Other Legal and Regulatory Requirements section of our report of even date)
In terms of the information and explanations sought by us and given by the Company and the books of account and records examined by us in the normal course of audit and to the best of our knowledge and belief, we state that:
B. The Company has maintained proper records showing full particulars of intangible assets.
(ii) (a) The inventories except for goods-in-transit, were physically verified during the year by the Management at reasonable intervals. In our opinion and based on information and explanations given to us, the coverage and procedure of such verification by the Management is appropriate having regard to the size of the Company and the nature of its operations. Majority of the goods have been received subsequent to the year end. No discrepancies of 10% or more in the aggregate for each class of inventories were noticed on such physical verification of inventories performed, when compared with the books of account.
(b) According to the information and explanations given to us, the Company has been sanctioned working capital limits in excess of Rs. 5 crores, in aggregate, at points of time during the year, from banks on the basis of security of current assets. In our opinion and according to the information and explanations given to us, the quarterly returns or statements comprising stock statements, book debt statements and other stipulated financial information filed by the Company with such banks are in agreement with the unaudited books of account of the Company of the respective quarters (upto December 31, 2024). The Company is yet to submit the return/ statement for the quarter ended March 31, 2025 with the banks or financial institutions.
Description of property |
As at March 31, 2025 | Held in the name of | Whether promoter, director or their relative or employee | Period held | Reason for not being held in the name of the Company |
Gross carrying value (Rs. in Cr.) | |||||
Freehold land located at Plot No. 1, Phase-IV, I.P, Pashamylaram, Hyderabad admeasuring 20,378 sq mtr. |
1.56 | Andhra Pradesh Industrial Infrastructure Corporation Limited (now Telangana State Industrial Infrastructure Corporation [TSIIC]) | No | (since 2009-10) | In dispute* |
Leasehold Land located at Munder Pargana -Pali, Tehsil-Sawaljpur, District-Hardoi admeasuring 28 hectares |
0.40 (WDV Nil) | M/s Kitply Industries Limited | No | From November 22,2024 to till date | Renewal in progress |
*The Company has filed a writ petition before High Court of Telangana against cancellation of provisional allotment of the Land by TSIIC. The High Court has provided an interim stay against cancellation.
Particulars |
Amount (Rs. in cr.) |
A. Aggregate amount of loan granted during the year: |
|
- Subsidiaries | 7.31 |
- Employee loans | 29.26 |
B. Balance outstanding as at balance sheet date in respect of above cases:* | |
- Subsidiaries | 5.30 |
- Employee loans | 48.68 |
* The amounts reported are at gross amounts and no provisions made during the year.
The Company has not provided any guarantee or security to any other entity during the year.
186 of the Companies Act, 2013 in respect of loans granted, investments made and guarantees, and securities provided, as applicable.
Undisputed statutory dues, including Goods and Service tax, Provident Fund, Employees State Insurance, Income-tax, duty of Customs, duty of Excise, cess and other material statutory dues applicable to the Company have been regularly deposited by it with the appropriate authorities in all cases during the year.
There were no undisputed amounts payable in respect of Goods and Service tax, Provident Fund, Employees State Insurance, Income-tax, duty of Customs, duty of Excise, cess and other material statutory dues in arrears as at March 31, 2025 for a period of more than six months from the date they became payable.
(B) Details of statutory dues referred to in sub-clause (a) above which have not been deposited as on March 31, 2025 on account of disputes are given below:
Name of Statute |
Nature of Dues | Forum where the Dispute is Pending | Period to which the Amount Relates | Unpaid Amount (Rs. in Cr) # |
Central Excise Act, 1944 | Excise Duty | Customs, Excise and Service Tax Appellate Tribunal | 2002-03, 2015-16 to 2017-18 |
3.32 |
Central Excise Act, 1944 | Excise Duty | Appellate authority upto Commissioner level | 2007-08, 2008-09, 2015-16 |
0.43 |
Finance Act, 1994 | Service Tax | Customs, Excise and Service Tax Appellate Tribunal | 2015-16 | 0.04 |
Finance Act, 1994 | Service Tax | Appellate authority upto Commissioner level | 2016-17 | 0.21 |
Sales Tax Laws | Sales Tax | Rajasthan Tax Board | 2011-12 | - |
Customs Tax Act, 1962 | Customs Duty | Customs, Excise and Service Tax Appellate Tribunal | 2012-13 | 9.20 |
CGST Act, 2017 | Good and Services Tax | Appellate Authority, Delhi | 2017-18 | 0.25 |
CGST Act, 2017 | Good and services Tax | Appellate Authority, Andhra Pradesh | 2019-20 | 0.01 |
CGST Act, 2017 | Good and Services Tax | Deputy Commissioner of State Tax (GST Appeals), Chennai |
2022-23 | 0.04 |
CGST Act, 2017 | Good and Services Tax | Adjudicating Authority, Uttarakhand | 2018-19 | 0.27 |
WBGST Act, 2017 | Good and Services Tax | Adjudicating Authority, West Bengal | 2019-20 | 0.03 |
WBGST Act, 2017 | Good and Services Tax | Assistant Commissioner, West Bengal | 2020-21 | 0.05 |
CGST Act, 2017 | Good and Services Tax | Adjudicating Authority | July 2017 to 2019-20 | 0.07 |
Uttar Pradesh Sheera Niyantran (Dwitya Sanshodhan) Adhiniyam, 2021 | Regulatory Fee | Allahabad High Court | 2020-21 to 2024-25 | 3.51 |
TNGST Act 2017/ CGST Act, 2017 | Good and Services Tax | Adjudicating Authority, Chennai | 2020-21 | 0.03 |
The following matters have been decided in favour of the Company although departments have preferred appeal at higher levels:
Name of Statute |
Nature of Dues | Forum where the Dispute is Pending | Period to which the Amount Relates | Unpaid Amount (Rs. in Cr) # |
Central Excise Act, 1944 | Excise Duty | High Court | 2005-06, 2008-09 | 3.41 |
Finance Act, 1994 | Service Tax | Supreme Court | 2008-09 to 2012-13 | 31.66 |
Sales Tax Laws | Sales Tax | Supreme Court | 2000-01, 2003-04 | 16.75 |
Trade Tax | Entry Tax | High Court | 2004-05 to 2006-07 | 0.85 |
Customs Tax Act, 1962 | Customs Duty | Customs, Excise and Service Tax Appellate Tribunal | 2020-21 to 2021-22 | 0.36 |
# Net of amount paid under protest amounting to Rs. 0.04 Cr, Rs. 0.48 Cr, Rs. 0.65 Cr, Rs. 0.05 Cr and Rs. 19.10 Cr relating to Excise Duty, Sales Tax, custom duty, Goods and Services Tax and Regulatory Fee respectively.
favourable order received on April 23, 2025 dropping the demand.
(b) During the year the Company has not made any preferential allotment or private placement of shares or convertible debentures (fully or partly or optionally) and hence reporting under clause (x)(b) of the Order is not applicable to the Company.
(b) We have considered, the internal audit reports issued to the Company during the year and covering the period upto March 2025.
(b) The Group does not have more than one Core Investment Company (CIC) as part of the group.
For Deloitte Haskins & Sells
Chartered Accountants (Firms Registration No.015125N)
Vijay Agarwal
(Partner) (Membership No. 094468) UDIN: 25094468BMMIYK7494
Place: New Delhi Date: May 05, 2025
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