219 HERITAGE FOODS LTD | 32ND ANNUAL REPORT 2023-24 Standalone STRATEGIC REVIEW STATUTORY REPORT FINANCIAL STATEMENTS (i) Key assumptions As at 31 March 2024 Weighted average cost of capital (WACC) 27.50% Terminal growth rate 5.00% Revenue growth - CAGR for 6 years ending FY30 84.20% (ii) Sensitivity analysis Reasonably possible changes as at 31 March 2024, holding other assumptions constant, can affect the impairment loss by the amounts shown below: As at 31 March 2024 Increase in assumption % Decrease in assumption % Impact on business value (HFL Share) Terminal growth rate (0.5% movement) 3.50 (4.00) WACC (1% movement) (22.50) 24.50 36. Fair value hierarchy (i) Financial assets and financial liabilities at fair value on a recurring basis as of the reporting dates are as follows: As at 31 March 2024 31 March 2023 Financial assets Fair value hierarchy (Level 1) Quoted equity shares 0.48 0.30 Fair value hierarchy (Level 2) Investments in mutual funds 1,130.08 - Fair value hierarchy (Level 3) Unquoted equity shares 2.60 2.60 There are no transfers between levels during the current and previous year ended 31 March 2024 and 31 March 2023 respectively. The Company’s policy is to recognise transfers into and transfers out of fair value hierarchy levels at the end of the reporting period. (ii) Valuation technique and inputs used for level 1 instruments: The fair value of equity shares is based on the traded price of the share at the reporting date. Valuation technique and inputs used for level 2 instruments: The fair value of mutual funds are based on price quotations at the reporting date. Valuation technique and inputs used for level 3 instruments: The fair value of the level 3 instruments has been estimated using the discounted cash flow model. The valuation requires management to make certain assumptions about the model inputs, including forecasting of cash flows, discount rate, credit risk and volatility. The probabilities of the various estimates within the range can be reasonably assessed and are used in the management’s estimate of the fair value for these level 3 instruments. The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy as at 31 March 2024 and 31 March 2023 are as shown below. Summary of the material accounting policies and other explanatory information (All amounts in ₹ millions, except share data and where otherwise stated)
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