Bhakta Ranjan Deka EPGP-12B-038

FA Assignment#4
Statement of Changes in Equity
Company Name: Deepak Nitrite

1. Please state the summarized ‘state of changes in equity’ for the last two years with all figures in
Rs. Crores (as was done in our class on the four different companies and also for HDFC AMC and
Aavas Financiers) … Please comment within 100 words

Ans.: Statement of change of equity

Equity Other Total Dividend Surplus

Capital Equity Comprehensive (Inc. Div. Carried
Income tax) forward to
the “Other
Equity”
FY2017 end 26.14 688.72

FY2018 Operation 225.01 18.88 206.13

FY2018 after Operation 27.28 894.86
FY2018 equity offerings
FY2018 buybacks
FY2018 miscellaneous
FY2018 end 27.28 894.86

FY2019 Operation 170.82 21.38 149.44

FY2019 after Operation 27.28 1044.3
FY2019 equity offerings
FY2019 buybacks
FY2019 miscellaneous
FY2019 end 27.28 1044.3

In the FY2017, the Company offered Equity Shares to Qualified Institutional Buyers (“QIBs”),
56,81,775 Equity Shares of 2/- each at an issue price of 264/- per Equity Share (including premium of
262/- per Equity Share). This helps the raise of equity capital from 26.14 Crore to 27.28 Crore.

Deepak Nitrite has adopted the AS-115 standard on April 01, 2018 by using the cumulative catch-up
transition method and accordingly, comparatives for the year ending or ended March 31, 2018 had
not be retrospectively adjusted. There is no material impact on adoption of Ind AS 115.

Company’s other equity increased each financial year shows the expansion of the company and its
profitability. At the end of FY19, other equity is 1044.3 Crore compared to previous year FY2018,
which was 894.86 Crore.

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Bhakta Ranjan Deka EPGP-12B-038

2. Mention the five biggest ‘other equity’ items (along with their proportions) as mentioned in the
annual report (to the extent available) … Please give your comments within 100 words

Ans.: Other Equity details-

Particulars Amount %
FY2019 Retained Earning 525.01 50.27
FY2018 Retained Earning 380.61 42.53
FY2019 General Reserve 83.9 0.08
FY2018 General Reserve 78.9 0.09
FY2019 Security Premium 434.17 41.57
FY2019 Security Premium 434.17 48.52

Retained earnings for FY2019, increased by approximately 8% (144.4 Crore). Change in retain
earning caused by Profit of the year (170.77 Crore), Payment of dividend on equity share including
Tax (- 21.38 Crore) and Transferred to General Reserve (5 crore).

General reserve is increased by 5Crore for the FY2019. General reserve is 83.9 Crore compared to
78.9 Crore of FY2018.

Security Premium remain unchanged for FY2018 and FY2019 i.e. 434.17 Crore.
Overall growth of Other equity for the year 2019 is 14.31% which is very good sign for the business.

3. Referring to the format and discussion shared with you in the class on Profit and Loss
Appropriation account (and its being transformed into ‘statement of changes in equity’), mention
one item that is probably missing and mention one items that you have found interesting in the
‘statement of changes in equity’. Please give your comments within 100 words.

Ans.:

Missing Item: There is no mention about “Free Reserve”, which was discussed in our class.

Interesting Item: Deepak Nitrite used to contribute (as per last three financial year report) 5 crore
from retained earnings to General reserve. This general reserve is used for appropriation purposes
and will not reclassified subsequently to the statement of profit and loss.

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