Related party transactions

Dealings between the company and people or entities connected to it: promoters, directors, their relatives, and companies those people control. The standard requires them to be disclosed in the notes, with amounts and balances outstanding.

A company with ₹4,800 crore of revenue disclosing ₹340 crore of sales to promoter-controlled entities is routing about 7% of its revenue through parties who are not at arm's length.

Most related party transactions are ordinary and harmless. The ones that are not tend to share a shape: money moving out of the listed company as loans, advances or purchases at prices nobody outside would pay, and moving back in as revenue that props up the reported growth.

Read the outstanding balances rather than only the transaction values. A large receivable from a promoter entity that never reduces is cash the shareholders have lent without deciding to.

Most are routine. The pattern is what matters.