IGC Pharma, Inc. Revenue Disclosure
NOTE 17 – REVENUE RECOGNITION
Revenue in the renting business when the equipment is rented, and the terms of the agreement have been fulfilled during the period. Revenue from the execution of infrastructure contracts is recognized on the basis of the output method as and when part of the performance obligation has been completed, and approval from the contracting agency has been obtained after a survey of the performance completion as of that date. The revenue from the wellness and lifestyle business is recognized once goods have been sold to the customer and the performance obligation has been completed. In retail sales, we offer consumer products through our online stores. Revenue is recognized when control of the goods is transferred to the customer. This generally occurs upon our delivery to a third-party carrier or to the customer directly. Revenue from white labelling services is recognized when the performance obligation has been completed, and output material has been transferred to the customer.
Net sales disaggregated by significant products and services for Fiscal 2025 and 2024 are as follows:
| (in thousands) Year ended March 31, | ||||||||
| 2025 ($) | 2024 ($) | |||||||
| Wellness and lifestyle (1) | 113 | 228 | ||||||
| White labeling services (2) | 1,158 | 953 | ||||||
| Other(3) | - | 164 | ||||||
| Total | 1,271 | 1,345 | ||||||
| (1) | Revenue from wellness and lifestyle consists of the sale of products such as gummies, hand sanitizers, bath bombs, lotions, beverages, hemp crude extract, hemp isolate, and hemp distillate. |
| (2) | Revenue from white labelling services consists of rebranding our formulations or the customer’s products as per the customer’s requirement. |
| (3) | Other consists of income from the rental of heavy construction equipment and the execution of contracts directly or through subcontractors. |
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.