greenply middle east limited and its subsidiary

GREENPLY MIDDLE EAST LIMITED

AND ITS SUBSIDIARY

Consolidated Financial Statements

31 March 2020

GREENPLY MIDDLE EAST LIMITED AND ITS SUBSIDIARY

Consolidated Financial Statements

31 March 2020

CONTENTS PAGES

Directors’ Report 1 – 2

Independent Auditors’ Report 3 – 4

Consolidated Statement of Financial Position 5

Consolidated Statement of Profit or Loss and Other Comprehensive Income 6

Consolidated Statement of Changes in Equity 7

Consolidated Statement of Cash Flows 8

Notes to the Consolidated Financial Statements 9 – 22

GREENPLY MIDDLE EAST LIMITED AND ITS SUBSIDIARY

Directors’ Report

The directors submit their report, along with the audited consolidated financial statements, for the year

ended 31 March 2020.

Results and appropriations

The results of the group and the appropriations made for the year ended 31 March 2020 are set out on

pages 6 and 7 of the consolidated financial statements.

In our opinion, the consolidated financial statements set out on pages 5 to 22 are drawn up so as to give a

true and fair view of the financial position of the group as at 31 March 2020 and the financial performance, changes in equity and cash flows of the group for the year then ended in accordance with

International Financial Reporting Standards.

At the date of the statement, there are reasonable grounds to believe that the group will be able to pay its

debts as and when they fall due.

Review of the business

Greenply Middle East Limited is the 100% subsidiary of Greenply Industries Limited, a public Listed

Company in India and it has a 100% Subsidiary Greenply Gabon SA. The Subsidiary is a manufacturer of Wood Veneer and Sawn Timber and also does trading of Round Logs, Veneer and Sawn Timber. During

2019-20, the Subsidiary has also started two additional big Peeling lines which made it capable of catering

to the European Markets and the requirements of South East Asian Markets. The Company’s marketing

efforts in South East Asia through its Representative office in Malaysia also led to increase in the sales to

Malaysia, Indonesia, Philippines, Taiwan etc. This has widened the market reach of the Company and in

spite of a slowdown in the Indian market the Company was able to increase its Sales in the European and

South East Asian Markets. Even during the Covid Lockdown, the Company continued to operate and

cater to the markets which were not under Lockdown.

Events since the end of the year

In view of pandemic relating to COVID-19, the group has considered internal and external information

available up to the date of approval of these consolidated financial results and has performed analysis

based on current estimates in assessing the recoverability of its assets including trade receivables, inventories and investments, other financial and non-financial assets, for possible impact on these

consolidated financial results. The group has also assessed the impact of this whole situation on its capital

and financial resources, profitability, liquidity position, etc. On the basis of its present assessment and

current indicators of future economic conditions, the group expects to recover the carrying amounts of

these assets and does not anticipate any material impact on these consolidated financial results. However,

the impact assessment of COVID-19 is a continuing process, given the uncertainties associated with its nature and duration. The group will continue to monitor any material changes to future economic

conditions and the consequent impact on its business, if any.

Directors

The directors who served during the year were as follows:

Mr. Rajesh Mittal

Mr. Sudeep Jain

GREENPLY MIDDLEEAST LIMITED AND ITS SUBSIDIARY

Notes to the consolidated financial statements for the year ended on 31 March 2020.

1. Legal status and activity

2. Basis of preparation

Statement of compliance

Basis of measurement

Functional and presentation currency

Basis of consolidation

% of % of

Ownership Ownership

Name of entity Country of Relation Activity 2020 2019

Incorporation

Greenply Gabon S.A. Republic of Gabon Subsidiary The principal activity of the company

is manufacturing of wood veneer,

lumber and panel.

100% 100%

Use of estimates and judgments

Application of new and revised International Financial Reporting Standards (IFRS)

The preparation of the consolidated financial statements requires management to make estimates and assumptions that may affect the

reported amount of financial assets and liabilities, revenue, expenses, disclosure of contingent liabilities and the resultant provisions and fair

values. Such estimates are necessarily based on assumptions about the several factors and actual results may differ from reported amounts.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in

which the estimate is revised and in any future periods affected. The areas involving a higher degree of judgment or complexity, or areas

where assumptions and estimates are significant to the consolidated financial statements is disclosed in note 4.

The group has adopted IFRS 16 – Leases which is effective for annual periods beginning on or after 1 April 2019:

IFRS 16 supersedes IAS 17 Leases and related interpretations. The standard sets out the principles for the recognition, measurement,

presentation, and disclosure of leases and requires lessees to account for most leases under a single on-balance sheet model. Lessor

accounting under IFRS 16 is substantially unchanged from IAS 17. Lessors will continue to classify leases as either operating or finance

leases using similar principles as in IAS 17. Therefore, IFRS 16 did not have an impact for leases where the company is the lessor. The group

elected to use the transition practical expedient allowing the standard to be applied only to contracts that were previously identified as leases

applying IAS 17 and IFRIC 4 at the date of initial application. The group also elected to use the recognition exemptions for lease contracts that,

at the commencement date, have a lease term of 12 months or less and do not contain a purchase option (‘short term leases’), and lease

contracts for which the underlying asset is of low value (‘low-value assets’).

The adoption of this new standard has no impact on the group’s consolidated financial statements. Further, the group has not early adopted

any other standard, interpretation or amendment that has been issued but are not yet effective.

GREENPLY MIDDLE EAST LIMITED (the “company”) is a private limited liability company incorporated as per the laws of Jebel Ali Free Zone

Authority Offshore Companies Regulations. The registered address of the company is BB11, Bay Square, Business Bay, P. O. Box 118767,

Dubai, United Arab Emirates.

GREENPLY MIDDLE EAST LIMITED has carried out the activity of third port trading in wood veneer during the year.

The consolidated financial statements comprise the financial statements of the company and its subsidiary as at 31 March 2020. This control

is evidenced when the company owns, either directly or indirectly, more than 50% of the voting rights of a company and is able to govern the

financial and operating policies of an enterprise so as to benefit from its activities. All intra-group balances, transactions, income and expenses

and profits and losses resulting from intra-group transactions are eliminated. The company and its subsidiary form the “Group”. The extent of

company’s shareholding and the principal activity of the subsidiary are set out below:

The company is a subsidiary of GREENPLY INDUSTRIES LIMITED, India, which is a public limited company registered under Indian

Companies Act 1956 and is listed on National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). It is engaged in the business of

manufacturing plywood, medium density fiber boards and allied products.

The company has a representative office located in Malaysia

The consolidated financial statements have been prepared under accrual basis of accounting and on the basis that the group will continue as a

going concern in accordance with International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards

Board (IASB) and interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC).

The consolidated financial statements have been prepared on historical cost basis.

The consolidated financial statements are prepared in US Dollars (USD), being the functional and presentation currency of the group.



2A. Summary of significant accounting policies

Property, plant and equipment

Factory land and building 5 – 20 years

Electrical installation 10 years

Plant and machinery 5 – 10 years

Motor vehicle 5 years

Furniture and fixtures 5 – 10 years

Office equipment 3 – 4 years

Inventories

Financial instruments

Financial assets

Trade receivables

Other current financial assets

Cash and cash equivalents

Cash and bank balance in the consolidated statement of financial position comprise cash and bank balance in call and current accounts that

are readily convertible to known amount of cash and which are subject to an insignificant risk of changes in value.

Cash and cash equivalents for the purpose of the consolidated statement of cash flows comprise cash and bank balance in current accounts

net of outstanding overdrafts as they are considered an integral part of the group’s cash management.

Assessment of net realizable value is made at each subsequent reporting date. When the circumstances that previously caused inventories to

be written down below cost no longer exist or when there is clear evidence of an increase in net realizable value because of changed

economic circumstances, the amount of the write-down is reversed.

Financial assets and financial liabilities are recognized when, and only when, the group becomes a party to the contractual provisions of the

instrument. Financial assets are de-recognized when, and only when, the contractual rights to receive cash flows expire or when substantially

all the risks and rewards of ownership have been transferred. Financial liabilities are de-recognized when, and only when, they are

extinguished, cancelled or expired.

The financial assets comprise trade and other receivables and cash and bank balance.

Trade receivables are stated at original invoice amount less a provision for any uncollectible amount. An estimate for doubtful debts is made

when collection of the full amount is no longer probable and provided for in the accounts. Bad debts are written off when there is no possibility

of recovery.

Other current financial asset represents refundable deposits and advance to others.

Property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is

calculated to write off cost of items of property, plant and equipment less their estimated residual value using straight-line method over their

estimated useful life as follows:

Inventories which comprise raw materials, work-in-progress, finished goods, stock-in-trade, packing materials, stores and spares are

measured at the lower of cost and net realizable value. The cost of inventories is ascertained on the 'weighted average' basis. Cost comprise

direct materials and, where applicable, direct labor costs and those overheads that have been incurred in bringing the inventories to their

present location and condition.

Raw materials, components and other supplies held for use in the production of finished products are not written down below cost except in

cases where material prices have declined and it is estimated that the cost of the finished products will exceed their net realizable value. The

comparison of cost and net realizable value is made on an item-by-item basis.

The net realizable value of work-in-progress is determined with reference to the selling prices of related finished products.

In the case of manufactured inventories and work-in-progress, cost includes an appropriate share of fixed production overheads based on

normal operating capacity. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of

completion and the estimated costs necessary to make the sale.

The accounting policies, which are consistent with those used in the previous year, except for new standards effective on 1 April 2019, in

dealing with items that are considered material in relation to the consolidated financial statements are as follows.



Impairment of financial assets

Financial liabilities

Borrowings

Bank overdraft

Trade and other payables

Revenue recognition

Sale of products

Insurance claim

Interest income

Foreign currency transactions

2B

2B.1 Significant judgment employed

Impairment of non-financial assets

Transactions in foreign currencies other than US Dollars are converted into US Dollars at the rate of exchange ruling as on the date of the

transaction.

Assets and liabilities expressed in currencies other than US Dollars are translated into US Dollars at the rate of exchange ruling on the date of

the consolidated statement of financial position. Resulting gain or loss is taken to the consolidated statement of profit or loss and other

comprehensive income

Significant judgment employed in applying accounting policies and key sources of estimation uncertainty

The significant judgment made in applying accounting policies that has the most significant effect on the amounts recognized in the

consolidated financial statements is as follows:

The group assesses whether there are any indicators of impairment for all non-financial assets at each reporting date. If any of such indication

exists, the group estimates the asset’s recoverable amount which is the higher of fair value less costs to sell and value in use. When value in

use calculations are undertaken, management must estimate the expected future cash flows from the asset or cash-generating unit and

choose a suitable discount rate in order to calculate the present value of those cash flows. Other non-financial assets are tested for

impairment when there are indicators that the carrying amounts may not be recoverable.

Bank overdraft is classified as current liability unless the group has an unconditional right to defer settlement of the liability for at least 12

months after the reporting period.

Liabilities are recognized for amounts to be paid in future for goods or services received, whether invoiced by the supplier or not.

The group derives revenue principally from sale of Veneer, Sawn timber, Timber Logs. Revenue from the sale of goods is recognized when

the significant risks and rewards of ownership have been transferred to the buyer. No revenue is recognized if there are significant

uncertainties regarding recovery of the amount due, associated costs or the possible return of goods. Provisions for discounts and rate

difference are estimated and provided for in the year of sales and recorded as reduction of revenue.

Insurance claim due to uncertainty in realization are accounted for on acceptance basis.

Revenue from interest income is recognized on accrual basis using the effective interest rate method.

For trade receivables, the group applies a simplified approach in calculating ECLs. Therefore, the group doesn’t track changes in credit risk,

but instead recognizes a loss allowance based on Lifetime ECLs at each reporting date. Loss allowance is based on the group’s historical

credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.

The financial liabilities comprise trade and other payables, working capital loan, term loan and bank overdraft.

Borrowings are initially recognized at proceeds received and are subsequently measured at amortized cost using effective interest method.

Finance charges, including interest payable on settlement are accounted for in the consolidated statement of profit or loss and other

comprehensive income using effective interest method.

Borrowings are removed from the consolidated statement of financial position when the obligation specified in the contract is discharged,

cancelled or expired. Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the

liability for at least 12 months after reporting period.

Bank overdraft is recognized initially at fair value, net of transaction costs incurred. Bank overdraft are removed from the consolidated

statement of financial position when the obligation specified in the contract is discharged, cancelled or expired.

The group recognizes an allowance for expected credit losses (ECLs) on its financial assets. ECLs are required to be measured through a

loss allowance at an amount equal to:

12-month ECL, which represents the portion of lifetime ECL that is expected to result from default events on a financial instrument that are

possible within 12 months after the reporting date.

Lifetime ECL, which represents the expected credit losses that will result from all possible default events over the expected life of a financial

instrument.



Significant increase in credit risk

2B.2 Key sources of estimation uncertainty

Useful lives of assets

Inventory provision

Impairment of trade and other receivables

The loss allowance for trade and other receivables are based on assumptions about risk of default and expected credit loss rates. The group

uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the group’s past history, existing

market conditions as well as forward-looking estimates at the end of each reporting period.

Any difference between the amounts actually collected in the future period and the amounts expected, will be recognized in the group’s

consolidated statement of profit or loss in that period. As at date of consolidated statement of financial position, management believes that the

recoverability of its trade and other receivables are certain, accordingly, the provision provided in the previous years are adequate.

ECL are measured as an allowance equal to 12-month ECL for stage 1 assets, or lifetime ECL assets for stage 2 or stage 3 assets. An asset

moves to stage 2 when its credit risk has increased significantly since initial recognition. IFRS 9 does not define what constitutes a significant

increase in credit risk. In assessing whether the credit risk of an asset has significantly increased the group takes into account qualitative and

quantitative reasonable and supportable forward-looking information.

As at date of consolidated statement of financial position, management believes that the recoverability of its long-term loans are certain,

accordingly, no expected credit losses are recognized.

Key assumptions made concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk

of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are as under:

The useful lives of the group’s assets with definite life are estimated based on the period over which the assets are expected to be available

for use. The estimated useful lives of group’s property, plant and equipment are reviewed periodically and are updated if expectations differ

from previous estimates due to physical wear and tear, technical or commercial obsolescence and legal or other limits on the use of the

group’s assets. In addition, the estimation of the useful lives is based on the group’s collective assessment of industry practice, internal

technical evaluation and experience with similar assets.

Management regularly undertakes a review of the group’s inventory in order to assess the likely realization proceeds, taking into account

purchase and replacement prices, age, likely obsolescence, the rate at which goods are being sold and the physical damage. Based on the

assessment assumptions are made as to the level of provisioning required.


Notes to the consolidated financial statements for the year ended 31 March 2020

( Amount in USD )

3. Property, plant and equipment

(a) Reconciliation of carrying amount

Freehold land Buildings Plant and

Machinery

Electrical

Installation

Furniture and

fixtures

Office

equipment

Computer

equipment Vehicles Heavy Vehicles Total

Cost (Gross carrying amount)

Balance at 1 April 2019 7,104,701 2,840,869 894,587 364,867 91,997 1,833 16,817 275,304 1,346,169 12,937,144

Additions 268,359 1,584,438 1,735,029 144,059 62,272 3,424 3,222 9,007 136,476 3,946,286

Disposals/ discard

Exchange differences on translation of

foreign operations

(121,982) (61,254) (29,731) (7,365) (1,943) (60) (290) (4,715) (23,835) (251,175)

Balance at 31 March 2020 7,251,078 4,364,053 2,599,885 501,561 152,326 5,197 19,749 279,596 1,458,810 16,632,255

Accumulated depreciation

Balance at 1 April 2019 - 232,494 135,852 73,083 15,933 169 4,652 69,238 346,108 877,529

Depreciation for the year - 208,548 147,695 43,251 14,720 1,139 4,832 58,352 172,272 650,809

Adjustments/ disposals - - - - - - - - - -


foreign operations

- (5,679) (3,536) (1,597) (391) (12) (104) (1,660) (7,288) (20,267)

Balance at 31 March 2020 - 435,363 280,011 114,737 30,262 1,296 9,380 125,930 511,092 1,508,071

Carrying amounts (net)

At 31 March 2019 7,104,701 2,608,375 758,735 291,784 76,064 1,664 12,165 206,066 1,000,061 12,059,615

At 31 March 2020 7,251,078 3,928,690 2,319,874 386,824 122,064 3,901 10,369 153,666 947,718 15,124,184

-

4. Capital work-in-progress^

31-Mar-20 31-Mar-19

At the beginning of the year 1,671,471 -

Additions during the year 25,295 1,718,471

Capitalised/ transfer during the year (1,522,664) -


foreign operations

(15,517) (47,000)

At the end of the year 158,585 1,671,471

-

5. Other intangible assets

(a) Reconciliation of carrying amount

Computer

Software Total

Cost (Gross carrying amount)

Balance at 1 April 2019 12,466 12,466

Additions - -

Disposals/ discard - -

Exchange differences on translation of foreign operations (210) (210)

Balance at 31 March 2020 12,256 12,256

Accumulated amortisation

Balance at 1 April 2019 12,191 12,191

Amortisation for the year 258 258

Adjustments/ disposals - -

Exchange differences on translation of foreign operations (208) (208)

Balance at 31 March 2020 12,241 12,241

Carrying amounts (net)

At 31 March 2019 275 275

At 31 March 2020 15 15


Notes to the consolidated financial statements for the year ended 31 March 2020 (continued)

(Amount in USD )

6. Loans 31 March 2020 31 March 2019

(Unsecured, considered good)

Security Deposit 44,006 39,487

44,006 39,487

7. Other non - current assets


Capital Advances 1,066,288 589,183

1,066,288 589,183

8. Inventories

Raw materials 587,478 442,015

Work-in-progress 329,752 -

Finished goods 1,966,174 614,396

Stock in transit 1,237,909 2,877,881

Stores and spares 400,137 158,961

4,521,450 4,093,253

9. Trade receivables

Current

Unsecured, Considered good

Trade receivables* 6,853,926 4,289,492

6,853,926 4,289,492

Total <30 Days 31-60 Days 61-120 Ddays

US $ US $ US $ US $

Outstanding 6,853,926 3,678,404 853,916 708,230

Recoveries (2,614,429) (1,834,097) (332,683) (105,782)

Net outstanding 4,239,497 1,844,307 521,233 602,448

121-180 Days 181-365 Days More than 365 days

US $ US $ US $

Outstanding 711,640 847,212 54,524

Recoveries (206,202) (132,958) (2,707)

Net outstanding 505,438 714,254 51,817

Location 2020 2019

(%) (%)

Bangladesh - 0.36%

China 0.56% 0.66%

Cyprus 0.09% -

France 5.03% -

Gabon 9.37% 18.28%

Greece 2.56% -

Holland - 0.17%

Hong Kong - 0.23%

India 50.55% 63.19%

Indonesia 3.74% 0.29%

Israel 0.31% 0.65%

ITALY 1.99% 0.06%

JAPAN 0.99% -

Kenya 0.16% -

Malaysia 5.43% 0.70%

Nepal - 0.60%

New Zealand 0.29% -

OMAN 0.30% 0.17%

Philippines 3.47% 8.46%

Portugal 0.18% -

Saudi Arabia 0.24% -

Singapore 0.32% -

Spain 8.15% 1.82%

Sri Lanka 0.48% 0.86%

TAIWAN 1.19% -

THAILAND 0.37% 0.71%

U K 0.19% -

UAE 2.88% 1.93%

USA 0.06% -

Vietnam 1.09% 0.86%

100% 100%

The group’s average credit period is 0-180 days after which trade receivables are considered to be past due. Unimpaired receivables are expected, on

the basis of past experience, to be fully recoverable.

Since the date of statement of financial position, the group has recovered USD 2,614,429 from trade receivables.

Geographical concentration of trade receivables as at 31 March 2020 was as follows:

*Trade receivables include USD 401,864 (31 March,2019 : USD 1,058,341) due from related parties on trade account. stated amount net of bills

discounted of USD 1,176,521 ( 31 March,2019 : USD 2,326,324) with banks without recource.



(Amount in USD )

10. Cash and cash equivalents 31 March 2020 31 March 2019

Cash on hand 40,346 6,297

Balances with banks

- On current accounts 28,919 321,829

- On call accounts - 11,098

69,265 339,224

11. Other financial assets


Current

TVA Receivable 52,592 -

52,592 -

12. Other current assets


Advances to Others 1,749 82,928

Advances to employees 21,206 -

Advances to Suppliers 493,051 885,537

Prepaid expenses 59,535 -

575,541 968,465

13. Equity share capital

Authorised

220 (31March 2019 : 220 ) equity shares of AED 100,000 each 5,994,550 5,994,550

(converted @ 1 USD = AED 3.67)

Issued, subscribed and fully Paid- up

100 (31March 2019 : 220) equity shares of AED 100,000 each 2,724,796 2,724,796

(converted @ 1 USD = AED 3.67)

2,724,796 2,724,796

Number Amount Number Amount

Balance at the beginning and at the end of the

Period 100 2,724,796 100 2,724,796

(b) Particulars of shareholders holding more than 5% shares of fully paid up equity shares

Equity shares of AED 100,000 each Number % Number %

Greenply Industries Limited 100 100% 100 100%

14. Other equity 31 March 2020 31 March 2019

Retained earnings

At the commencement of the year 870,606 (1,104,860)

Add: Profit for the year 2,099,902 1,975,466

2,970,508 870,606

Other comprehensive income (OCI)

At the commencement of the year 1,564 318,464 (103,302) (316,900)

(101,738) 1,564

2,868,770 872,170

Exchange differences in translating financial statements of foreign

subsidiary

(a) Reconciliation of equity shares outstanding at the beginning and at the end of the reporting period

31 March 2020 31 March 2019

31 March 2020 31 March 2019



(Amount in USD )

15 Borrowings 31 March 2020 31 March 2019

Non-current borrowings

Secured

Term loans

From banks

Foreign currency loans 6,711,900 8,612,172

Less: Current maturities of non-current borrowings (refer note 16) 2,181,800 2,207,779

4,530,100 6,404,393

Unsecured

From Related Party 2,800,000 3,200,000

2,800,000 3,200,000

7,330,100 9,604,393

Current borrowingsSecured

From banks

US $ Loan - WCL 2,800,000 2,800,000

US $ Loan - Overdraft 3,390,754 2,340,605

XAF Loan - Overdraft 2,367,361 -

Unsecured

Bank Overdrawn 475 -

8,558,590 5,140,605

Terms of Repayment & Security

16. Other financial liabilities 31 March 2020 31 March 2019

Current

Current maturities of non current borrowings (refer note 15) 2,181,800 2,207,779

Liability for capital goods 865,694 1,588,139

Interest payable to parent shareholder company 48,829 63,139

Interest Payable to Banks 91,587 -

Commission on SBLC payable 44,431 59,295

Accruals & provisions 90,711 366,905

3,323,052 4,285,257

17. Trade payables

Trade Payables 3,354,418 1,314,461

3,354,418 1,314,461

c) Working Capital Loan USD 2,800,000 ( 31 March 2019 : USD 2,800,000) from Axis Bank is secured against irrecovable and unconditional standby

letter of credit issued by Axis Bank, kolkata branch,India on request of Greenply Industries Ltd, India in favour of Axis Bank, DIFC Branch, Dubai,

U.A.E.This overseas bank Loan repayble on demand and bearing interest rate 3 months libor plus 225 bps p.a.

d) Bank Overdraft USD 3,390,754 (31 March 2019 : USD 2,340,606) from Citi Bank is secured against irrecovable and unconditional standby letter of

credit issued by Citi Bank, N.A., Kolkata Branch,India on request of Greenply Industries Ltd, India in favour of Citi Bank N.A.,Dubai Branch,U.A.E. This

overseas bank Loan repayble on demand and bearing interest rate 1 month libor plus 275 bps p.a.

(b) Term Loan USD 2,164,500 (31 March,2019 : USD 2,830,500) from Axis Bank is secured against irrecovable and unconditional standby letter of credit

issued by Axis Bank, kolkata branch,India on request of Greenply Industries Ltd, India in favour of Axis Bank, DIFC Branch, Dubai, U.A.E.This overseas

Bank Loan repayble in 20 equal instalments of USD 166,500 per quarter from the date of disbursement and bearing interest rate 3 months libor plus 275

bps p.a.

(a) Term Loan Euro 4,125,000 (31 March,2019 : Euro 5,156,250 ) from Exim Bank is secured against i) exclusive charge on the movable project assets

including current assets, both present & future of the company (GGSA) at Gabon,ii) Pledge of 100% shares of Greenply Gabon SA held by Greenply

middleeast Ltd, iii) Unconditional & Irrevocable Corporate Guarantee of Greenply Industries Ltd. This overseas Bank Loan repayble in 16 equal

instalments of EURO 343,750 per quarter from the date of disbursement and bearing interest rate 3 months euribor plus 325 bps p.a.

f) Unsecured loan from related party i.e. parent shareholder company and bearing interest rate 12 months libor plus 500 bps p.a.

e) Bank Overdraft USD 2,367,361 (31 March 2019 : USD NIL) from BGFI Bank is guaranteed by (i) an irrevocable domiciliation of receipts up to 60% of

turnover (ii) a pledge of goodwill. This bank Loan repayble on demand and bearing interest rate 9 % p.a.



(Amount in USD )

18. Other current liabilities 31 March 2020 31 March 2019

Statutory dues 40,023 11,075

Advance from customers 80,740 97,708

Advance from customers - related party 185,363 -

306,126 108,783

Year ended Year ended

19. Revenue from operations 31 March 2020 31 March 2019

Sale of products

Veneer Sales 21,748,389 16,859,952

Sawn Timber Sales 1,764,106 1,772,986

Logs Sales 2,107,851 3,520,729

Other Sales - 519

25,620,346 22,154,186

Revenue by geography:

- India 12,950,957 13,998,624

- Outside India 12,669,389 8,155,562

25,620,346 22,154,186

- -

20. Other income

Interest received 15,483 32

Insurance claim received 6,751 -

Rent Received 4,572 -

Misc. Income 2,347 43,830

29,153 43,862

21. Cost of materials consumed

Inventory of raw materials at the beginning of the

year454,445 899,156

Add: Purchases 11,222,880 8,711,414

Less: Inventory of raw materials at the end of the

year

587,478 454,445

11,089,847 9,156,125

22. Purchase of stock in trade

Purchase of stock-in-trade 2,262,087 3,258,631

2,262,087 3,258,631

23. Changes in inventories of finished goods,

work-in-progress and stock in trade

Opening inventories

Finished goods 631,673 1,055,247

Work-in-progress - -

Stock in trade 2,877,881 425,897

3,509,554 1,481,144

Closing inventories

Finished goods 1,966,174 631,673

Work-in-progress 329,752 -

Stock in trade 1,237,909 2,877,881

3,533,835 3,509,554

Effect of Foreign Exchange Fluctuations (42,043) -

(66,324) (2,028,410)

24. Employees benefits expense

Director's remuneration 110,406 49,108

Salaries,Wages and Bonus 1,628,998 768,073

Contractor’s Wages 403,773 1,343,457

Contribution to Employee benefit funds 124,103 31,989

Staff Welfare Expenses 155,716 52,272

2,422,996 2,244,899



(Amount in USD )


25. Finance costs 31 March 2020 31 March 2019

Interest on Loan - related party 213,470 257,922

Interest on Loan - Bank 298,514 432,399

Interest on bills discounting 66,483 27,958

Interest on bank overdraft 180,965 86,869

Guarantee Commission to related party 252,567 240,944

Loan Processing Fees 7,564 -

1,019,563 1,046,092

26. Depreciation and amortisation expense

Depreciation 650,809 523,460

Amortisation 258 7,315

651,067 530,775

27. Other expenses

Consumption of stores and spares 269,135 366,779

Job Work Charges 428,705 493,340

Power and fuel 131,580 95,927

Water Expense 6,915 9,392

Electric Expenses 12,586 8,703

Rent 35,734 28,506

Repairs & Maintenance 105,124 127,504

Insurance 96,733 67,139

Rates and taxes 198,644 6,610

Security Expenses 64,731 51,435

Legal & Professional 168,992 137,366

Accounting Charges 90,000 -

Auditor Remuneration 45,175 26,138

Travelling Exps (Foreign) 140,409 71,199

Travelling & Conveyance Expenses 65,545 18,188

Freight Outward 28,988 26,481

Transport charges 2,480 5,657

CHA Charges 2,478,302 1,881,966

Export Expenses 1,150,652 1,506,637

Pallet Expenses 96,233 87,712

Warehouse Expenses - 32,236

Sales Promotion Expenses 18,962 28,803

Printing & Stationery 3,914 4,719

Postage & Telegram 7,186 6,986

Telephone & Internet 21,885 23,076

Commission Charges 50,042 44,927

Bank Charges 125,236 99,901

Foreign exchange fluctuations(net) 140,974 568,500

Vehicles expenses 46,144 21,693

Visa & Immigration Expenses 71,202 52,829

Entertainment Expenses 24,671 12,264

Plantation at Site Expenses 1,034 7,625

General Expenses 2,052 4,290

Office Expenses 1,917 4,790

Guest House Expenses 27,817 34,479

Loading & Unloading Expenses 847 8,203

Miscellaneous expenses 9,815 42,470

6,170,361 6,014,470



(Amount in USD )

28. Cash and cash equivalents 31 March 2020 31 March 2019

(for the purpose of consolidated statement of cash flows)

Cash on Hand 40,346 6,297

Balances with banks

- On current accounts 28,919 321,829

- On call accounts - 11,098

69,265 339,224

Bank Overdraft (5,758,115) (2,340,605)

Bank Overdrawn (475) -

(5,689,325) (2,001,381)

29. Related party disclosure

a) Related parties with whom transactions have taken place during the year.

i) Greenply Industries Limited, Parent Shareholder Company

ii) Greenply Alkemal (Singapore) PTE Ltd, Joint Venture of Fellow Subsidiary

iii) Mr. Rajesh Mittal , Key management personnel

iv) Mr. Sudeep Jain , Key management personnel

b) Related party transactions


31 March 2020 31 March 2019

Name of the related party Nature of transaction

Greenply Industries Limited Sales 4,248,311 3,807,264

Loan received/ (repaid) (400,000) 700,000 Interest expense 213,470 257,922

Commission expense 252,567 240,944

Purchase of Machinery/ Stores &Spares 223,800 -

Greenply Alkemal (Singapore) PTE Ltd Advances received 200,000 -

Mr. Sudeep Jain Director's remuneration 110,406 49,108

C) Outstanding balances Dr/ (Cr) Dr/ (Cr)

Name of the related party Nature of transaction

Greenply Industries Limited Trade Receivable^ 4,01,864 1,058,341

Loan Account (2,800,000) (3,200,000)

Interest payable (48,829) (63,139)

Commission payable (59,547) (59,295)

Purchase of Machinery/ Stores & Spares 38,091 -

Greenply Alkemal (Singapore) PTE Ltd Advance from Customer (185,363) -

30. Earnings per share Year ended Year ended

31/Mar/20 31/Mar/19

USD USD

Basic and diluted earnings per share

(i) Profit for the year, attributable to the equity

shareholders 2,099,902 1,975,466

(ii) Weighted average number of equity shares

- Number of equity shares at the beginning of the

year 100 100

- Number of equity shares at the end of the year100 100

Weighted average number of equity shares 100 100

Basic and diluted earnings per share (₹) [(i)/(ii)]

20,999 19,755

^Trade receivables due from Greenply Industries Ltd is net of bills discounted of USD 11,62,660 (31 March,2019 : USD 16,40,038) with banks without recource.



(Amount in USD )

31. Contingent liabilities and capital commitments Year ended Year ended

(to the extent not provided for) 31 March 2020 31 March 2019

Contingent liabilities

(a) Claims against the group not acknowledged as debts: Nil Nil

(b) Guarantees outstanding Nil Nil

Capital and other commitments

(i) Estimated amount of contracts remaining to be executed

on capital account and not provided for (net of advances) 1,488,589 376,645

28. Capital management

29. Financial risk management: Credit, liquidity and market risk exposures.

Credit risk

Liquidity risk

31 March 2020Carrying amounts Payable within next

12 months

Between 1 to 5 years

USD USD USD

Term Loan (including current maturities)* 6,803,487 2,273,387 4,530,100

Working capital loan 2,800,000 2,800,000 -

Bank overdraft 5,758,115 5,758,115 -

Trade and other payables 4,710,684 4,710,684 -

20,072,286 15,542,186 4,530,100

31 March 2019 Carrying amounts Payable within next Between 1 to 5 years

USD USD USD

Term Loan (including current maturities)* 8,612,172 2,207,779 6,404,393

Working capital loan 2,800,000 2,800,000 -

Bank overdraft 2,340,605 2,340,605 -

Trade and other payables 3,500,722 3,500,722 -

17,253,499 10,849,106 6,404,393

* including estimated interest

Market risk

The group has derived its revenue from both domestic and overseas customers. Its 5 ( Five ) largest customers account for 37% (P.Y. 43%) of the sales.

As at 31 March 2020, the group had significant concentration of credit risk with 5 (five) customers accounting for 45% ( P.Y 63%) of the trade

receivables. The group seeks to limit its credit risk with respect to customers by setting credit limits for individual customers, monitoring outstanding

receivables and the terms of realization with the customers being letter of credit where available.

In this way, the customer balances are secured and considered good and recoverable by the management. There are no significant concentrations of

credit risk from receivables outside the industry in which the group operates.

Liquidity risk is the risk that the group will not be able to meet financial obligations as they fall due. The liquidity requirements are monitored on a regular

basis by the management and parent shareholder company who ensures that sufficient funds are made available to the group to meet the commitments

as they fall due. Although, short term payables are perceived as a liquidity risk, adequate steps are taken by the management and the parent company to

timely meet with the funding requirements.

The following are the contractual maturities of the company’s financial liabilities as at reporting date.

Market risk is the risk that changes in market prices, such as interest rate risk and currency risk, will affect the group’s income or the value of its holdings

of financial instruments.

The Group manages its capital to ensure that the Group will be able to continue as a going concern while maximizing the return to the parent shareholder

company through optimization of the debt and equity balance.The capital structure of the Group comprises net debt (interest bearing borrowings offset by

cash and bank balances) and equity (comprising paid up capital and loan account).

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. Financial

assets, which potentially expose the group to concentrations of credit risk comprise principally of bank balance and trade receivables. The group’s bank

balance in current and call accounts are placed with high credit quality financial institutions.



(Amount in USD )Interest rate risk

Exposure to interest rate risk

The interest rate profile of the Group 's interest bearing financial instruments at the end of the reporting period are as follows:

Particulars 31 March 2020 31 March 2019

Fixed rate instruments

Financial assets - -

Financial liabilities (2,367,361) -

(2,367,361) -

Variable rate instruments

Financial assets - -

Financial liabilities (15,702,654) (16,952,777)

(15,702,654) (16,952,777)

Sensitivity analysis

Particulars Nature Effect 31 March 2020 31 March 2019

Variable rate instruments Interest Expense (Dr)̂ Interest Rate Increase (157027) (169528)

Interest Expense (Cr)̂ Interest Rate Decrease 157027 169528

Profit or (loss) Interest Rate Increase (157027) (169528)

Interest Rate Decrease 157027 169528

Equity, net of tax Interest Rate Increase (157027) (169528)


^includes exposure of +/- USD 28000 ( P.Y. 32000) from loan received from a related party

Cash flow sensitivity (net) Profit or (loss) Interest Rate Increase (157027) (169528)


Equity, net of tax Interest Rate Increase (157027) (169528)


Currency risk

2020 2019

Equivalent Equivalent

Foreign currency financial assets: USD USD

Trade receivable

Euro (EUR) 1,719,453 315,771

Bank balance

Euro (EUR) 4,252 101

The group has no established policy in managing interest rate risk. Any favorable or unfavorable movements of interest rates are absorbed by the group.

A 1% sensitivity rate is used in reporting interest rate risk internally to key management personnel and represents management’s assessment of the

reasonably possible change in interest rates. For floating rates, the analysis is prepared assuming the amount of asset and liability outstanding at the end

of each reporting period was outstanding for the whole year.

In management’s opinion, the sensitivity analysis is unrepresentative of the inherent interest rate risk because the exposure at the end of the reporting

period does not reflect the exposure during the year.

The group has no established policy in managing foreign exchange risk. Any favorable or unfavorable movements of foreign currency exchange rates are

absorbed by the group.

The carrying amounts of the group’s foreign currency denominated monetary assets and monetary liabilities at the end of each reporting period are as

follows:

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The

group’s exposure to the risk of changes in market interest rates relates primarily to the group’s borrowings from banks towards working capital loan, term

loan and overdraft, loan from the parent shareholder company and loan to a subsidiary with fixed and floating interest rates.

The following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables held constant, on the group’s

profit (through the impact on floating rate borrowings and loans):

A reasonably possible change of 100 basis points in variable rate instruments at the reporting dates would have increased or decreased profit or loss by

the amounts shown below:

Currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in foreign currency rates. The

group’s exposure to the risk of changes in foreign exchange rates relates primarily to the group’s operating activities (when revenue or expense is

denominated in a foreign currency).

greenply middle east limited and its subsidiary

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