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Notes forming part of the Standalone Financial Statements as at 31 March, 2020
Credit risk:

Credit risk is the risk that counterparty will not meet its obligations under a nancial
instrument or customer contract, leading to a nancial loss. The Corporation is exposed to
credit risk from its operating activities [primarily trade receivables] and from its nancing
activities, including deposits with banks and nancial institutions, foreign exchange
transactions and other nancial instruments. (` in crore)

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Particulars As at 31 March 2020 As at 31 March 2019
Trade Receivables 138.03 242.26
Total 138.03 242.26

The Company evaluates the concentration of risk with respect to trade receivables as low
as they most of them are government entities.

Exposure to the Credit risk on the nancial guarantee:

I. Performance Guarantee is given to Gujarat Water Infrastructure Ltd. amounting to
` 0.10 Crore (` 0.10 Crore), NTPC Projects amounting to ` 0.26 Crores (` 2.25 Crores)
and NSCPCL Project amounting to ` 0.09 Crore (` 0.09 Crore) .Margin money has
been kept for these bank guarantees in the form of term deposits.

ii. Advance Bank Guarantee amounting to ` 10.49 Crore. towards advance received,
related to supply of 2 DEMU rakes to Nepal Government, has been issued by Nabil
Bank – Nepal on the basis of counter guarantee issued by the ICICI Bank Ltd during
the Financial year.

Financial instruments and cash deposits:

Credit risk from balances with banks and nancial institutions is managed by the
Corporation's Finance department in accordance with the Corporation's policy.
Investments of surplus funds are made only with approved counterparties and within credit
limits assigned to each counterparty. Counterparty credit limits are reviewed by the
Corporation's Board of Directors on an annual basis and may be updated throughout the
year subject to approval of the Corporation's Finance Committee. The limits are set to
minimize the concentration of risks and therefore mitigate nancial loss through
counterparty's potential failure to make payments.

The Corporation's maximum exposure to credit risk is 'Other deposits' illustrated in Note 14
of the balance sheet at March 31, 2020 and March 31, 2019.

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