Notes to Accounts of Entero Healthcare Solutions Ltd.

Mar 31, 2025

3.10 Provisions And Contingent Liabilities

A provision is recognized when the Company has a
present obligation (legal or constructive) as a result of a
past event; it is probable that an outflow of resources
embodying economic benefits will be required to settle
the obligation and in respect of which a reliable
estimate can be made of the amount of the obligation.
Provisions are not discounted to its present value and
are determined based on best estimate required to
settle the obligation at the reporting date. These are
reviewed at each reporting date and adjusted to reflect
the current best estimates.

The Company creates a provision when there is a
present obligation as a result of a past event that
probably requires an outflow of resources embodying
economic benefits and a reliable estimate can be made
of the amount of the obligation.

A disclosure for a contingent liability is made when
there is a possible obligation or a present obligation
that probably will not require an outflow of resources
embodying economic benefits or where a reliable
estimate of the obligation cannot be made. When there
is a possible obligation or a present obligation in
respect of which likelihood of outflow of resources is
remote, no provision or disclosure is made.

Contingent assets are neither recorded nor disclosed in
the financial statements.

3.11 Cash And Cash Equivalents

Cash and cash equivalents in the balance sheet
comprise cash on hand , cash at banks and short-term
investments with an original maturity of three months
or less, which are subject to an insignificant risk of
changes in value and bank overdrafts are shown within
borrowings in current liabilities in the balance sheet.

Cash and cash equivalents for the purposes of cash flow
statement comprise cash on hand and cash at banks
and short-term investments with an original maturity of
three months.

3.12 Financial Instruments

A financial instrument is any contract that gives rise to a
financial asset of one entity and a financial liability or
equity instrument of another entity.

a) Financial assets

(i) Recognition and Initial measurement

At initial recognition, financial asset is measured at
its fair value plus or minus, in the case of a financial
asset not “at fair value through profit or loss" are
measured at transaction costs that are directly
attributable to the acquisition of the financial
asset. Transaction costs of financial assets carried
at fair value through profit or loss are expensed in
statement of profit and loss.

(ii) Classification and subsequent measurement

For purposes of subsequent measurement,
financial assets are classified in following
categories:

a) at amortized cost; or

b) at fair value through other comprehensive
income; or

c) at fair value through profit or loss.

The classification depends on the entity''s business
model for managing the financial assets and the
contractual terms of the related cash fiows.

Amortized cost: Assets that are held for collection
of contractual cash fiows where those cash fiows
represent solely payments of principal and interest
are measured at amortized cost. Interest income
from these financial assets is included in finance
income using the effective interest rate method
(EIR).

Fair value through other comprehensive
income (FVOCI): Assets that are held for collection

of contractual cash fiows and for selling the
financial assets, where the assets'' cash fiows
represent solely payments of principal and
interest, are measured at fair value through other
comprehensive income (FVOCI). Movements in the
carrying amounts are taken through Other
Comprehensive Income (''OCI''), except for the
recognition of impairment gains or losses, interest
income and foreign exchange gains and losses
which are recognized in statement of profit and
loss. When the financial asset is derecognized, the
cumulative gain or loss previously recognized in
OCI is reclassified from equity to statement of
profit and loss and recognized in other gains/
(losses). Interest income from these financial assets
is included in “Other income" using the effective
interest rate method.

Fair value through profit or loss (FVTPL): Assets
that do not meet the criteria for amortized cost or
FVOCI are measured at fair value through
statement of profit and loss. Interest and dividend
income from these financial assets is included in
“Other income" Net gains and losses, including any
interest or dividend income are recognized in
statement of profit and loss.

The Company enters into business combination
arrangements which may include terms where the
Group has purchased call option over the equity of
a subsidiary held by the non-controlling interest
which permit the Group to purchase the shares
held by the non-controlling interest at the exercise
price specified in the arrangement. The Group
analyses the terms of such arrangements to assess
whether they provide the Group or the non¬
controlling interest with access to the risks and
rewards associated with the actual ownership of
the shares.

The non-controlling interest is recognized in the
consolidated financial statements only if risks and
rewards associated with ownership have been
retained by the non-controlling interest. In such
case, the Company accounts for the call option as
derivative asset with corresponding credit to
investments / call option liability. Subsequent
changes in the fair value of derivative asset is
recognised in consolidated statement of profit or
loss.

Equity instruments: All equity investments in
scope of Ind AS 109 are measured at fair value.
Equity instruments which are held for trading and
contingent consideration recognised by an
acquirer in a business combination to which Ind

AS 103 applies are classified as FVTPL. For all other
equity instruments, the Company may make an
irrevocable election to present in OCI subsequent
changes in the fair value in other comprehensive
income. The Company makes such election on an
instrument-by-instrument basis. The classification
is made on initial recognition and is irrevocable.

If the Company decides to classify an equity
instrument as FVOCI, then all fair value changes on
the instrument, excluding dividends, are recognized
in the OCI. There is no recycling of the amounts
from OCI to statement of profit and loss, even on
sale of investment. However, the Company may
transfer the cumulative gain or loss within equity.

Equity instruments included within the FVTPL
category are measured at fair value with all
changes recognized in the statement of profit and
loss.

(iii) Impairment of financial assets

In accordance with Ind AS 109, Financial
Instruments, the Company applies expected credit
loss (ECL) model for measurement and recognition
of impairment loss on financial assets that are
measured at amortized cost and FVOCI.

For recognition of impairment loss on financial
assets and risk exposure, the Company determines
that whether there has been a significant increase
in the credit risk since initial recognition. If credit
risk has not increased significantly, 12-month ECL
is used to provide for impairment loss. However, if
credit risk has increased significantly, lifetime ECL
is used. If in subsequent years, credit quality of the
instrument improves such that there is no longer a
significant increase in credit risk since initial
recognition, then the entity reverts to recognizing
impairment loss allowance based on 12 months
ECL.

Life time ECLs are the expected credit losses
resulting from all possible default events over the
expected life of a financial instrument. The 12
months ECL is a portion of the lifetime ECL which
results from default events that are possible within
12 months after the year end.

ECL is the difference between all contractual cash
fiows that are due to the Company in accordance
with the contract and all the cash fiows that the
entity expects to receive (i.e. all shortfalls),
discounted at the original EIR. When estimating
the cash fiows, an entity is required to consider all

contractual terms of the financial instrument
(including prepayment, extension etc.) over the
expected life of the financial instrument. However,
in rare cases when the expected life of the financial
instrument cannot be estimated reliably, then the
entity is required to use the remaining contractual
term of the financial instrument.

In general, it is presumed that credit risk has
significantly increased since initial recognition if
the payment is more than 90 days past due.

ECL impairment loss allowance (or reversal)
recognized during the year is recognized as
income/expense in the statement of profit and
loss. In balance sheet ECL for financial assets
measured at amortized cost is presented as an
allowance, i.e. as an integral part of the
measurement of those assets in the balance sheet.
The allowance reduces the net carrying amount.
Until the asset meets write off criteria, the
Company does not reduce impairment allowance
from the gross carrying amount.

(iv) Derecognition of financial assets

A financial asset is derecognized only when

a) the right to receive cash fiows from the
financial asset is transferred or

b) retains the contractual rights to receive the
cash fiows of the financial asset but assumes
a contractual obligation to pay the cash fiows
to one or more recipients.

Where the financial asset is transferred then in that
case financial asset is derecognized only if
substantially all risks and rewards of ownership of
the financial asset is transferred. Where the entity
has not transferred substantially all risks and
rewards of ownership of the financial asset, the
financial asset is not derecognized.

b) Financial liabilities

(i) Recognition and Initial measurement

Financial liabilities are classified, at initial
recognition, as financial liabilities at fair value
through profit or loss and at amortized cost, as
appropriate.

All financial liabilities are recognized initially at fair
value and, in the case of borrowings and payables,
net of directly attributable transaction costs.

(ii) Subsequent measurement

The measurement of financial liabilities depends
on their classification, as described below:

Financial liabilities at fair value through profit or loss:
Financial liabilities at fair value through profit or loss
include financial liabilities held for trading and
financial liabilities designated upon initial recognition
as at fair value through profit or loss. Separated
embedded derivatives are also classified as held for
trading unless they are designated as effective
hedging instruments. Gains or losses on liabilities
held for trading are recognized in the statement of
profit and loss.

The Company enters into business combination
arrangements which may include terms where the
Company has written put options or a purchased
call option along with the written put, over the
equity of a subsidiary which permit the holder to
put their shares in the subsidiary back to the
Company at the exercise price specified in the
arrangement. The Company analyses the terms of
such arrangements to assess whether they provide
the Company or the non-controlling interest with
access to the risks and rewards associated with the
actual ownership of the shares.

The non-controlling interest is recognized in the
consolidated financial statements only if risks and
rewards associated with ownership have been
retained by the non-controlling interest. In such
cases, the Company accounts for the put option as
derivative liability with corresponding debit to
investments. Subsequent changes in the fair value
of derivative liability is recognised in the statement
of profit or loss.

(iii) Loans and borrowings

After initial recognition, interest-bearing loans and
borrowings are subsequently measured at
amortized cost using the EIR method. Gains and
losses are recognized in Statement of Profit and
Loss when the liabilities are derecognized as well
as through the EIR amortization process.
Amortized cost is calculated by taking into
account any discount or premium on acquisition
and fees or costs that are an integral part of the
EIR. The EIR amortization is included as finance
costs in the Statement of Profit and Loss.

(iv) Derecognition of Financial liability

A financial liability is derecognized when the
obligation under the liability is discharged or
cancelled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the
terms of an existing liability are substantially

modified, such an exchange or modification is
treated as the derecognition of the original liability
and the recognition of a new liability. The
difference in the respective carrying amounts is
recognized in the statement of profit and loss as
finance costs.

c) Embedded Derivatives

An embedded derivative is a component of a
hybrid (combined) instrument that also includes a
non-derivative host contract - with the effect that
some of the cash fiows of the combined
instrument vary in a way similar to a standalone
derivative. Derivatives embedded in all other host
contracts are separated if the economic
characteristics and risks of the embedded
derivative are not closely related to the economic
characteristics and risks of the host and are
measured at fair value through profit or loss.
Embedded derivatives closely related to the host
contracts are not separated.

Reassessment only occurs if there is either a
change in the terms of the contract that
significantly modifies the cash fiows that would
otherwise be required or a reclassification of a
financial asset out of the fair value through profit
or loss.

d) Offsetting financial instruments

Financial assets and liabilities are offset and the
net amount is reported in the balance sheet where
there is a legally enforceable right to offset the
recognized amounts and there is an intention to
settle on a net basis or realize the asset and settle
the liability simultaneously. The legally enforceable
right must not be contingent on future events and
must be enforceable in the normal course of
business and in the event of default, insolvency or
bankruptcy of the Company or the counterparty.

3.13 Employee Benefits

a) Short-term obligations

Liabilities for wages and salaries, including non¬
monetary benefits that are expected to be settled
wholly within 12 months after the end of the year
in which the employees render the related service
are recognized in respect of employees'' services
up to the end of the year and are measured at the
amounts expected to be paid when the liabilities
are settled. The liabilities are presented as current
employee benefit obligations in the balance sheet.

b) Other long-term employee benefit obligations

Post employment benefit plans

(i) Defined contribution plan

Provident Fund: Contribution towards provident
fund is made to the regulatory authorities, where
the Company has no further obligations. Such
benefits are classified as Defined Contribution
Schemes as the Company does not carry any
further obligations, apart from the contributions
made on a monthly basis which are charged to the
Statement of Profit and Loss.

Employee''s State Insurance Scheme:

Contribution towards employees'' state insurance
scheme is made to the regulatory authorities,
where the Company has no further obligations.
Such benefits are classified as Defined

Contribution Schemes as the Company does not
carry any further obligations, apart from the
contributions made on a monthly basis which are
charged to the statement of profit and loss.

The Company has no further obligations under
these plans beyond its monthly contributions.

(ii) Defined Benefit Plans

Gratuity: The Company provides for gratuity, a
defined benefit plan ( covering eligible employees
in accordance with the Payment of Gratuity Act,
1972. The Gratuity Plan provides a lump sum
payment to vested employees at retirement,
death, incapacitation or termination of
employment, of an amount based on the
respective employee''s salary. The Company''s
liability is actuarially determined (using the
Projected Unit Credit method) at the end of each
year. Actuarial losses/gains are recognized in the
other comprehensive income in the year in which
they arise.

Costs comprising service cost (including current
and past service cost and gains and losses on
curtailments and settlements) and net interest
expense or income is recognized in profit or loss.

The obligation recognized in the balance sheet
represents the actual deficit or surplus in the
Company''s defined benefit plans. Any surplus
resulting from this calculation is limited to the
present value of any economic benefits available
in the form of refunds from the plans or reductions
in future contributions to the plans.

Compensated Absences: Accumulated

compensated absences, which are expected to be

availed or encashed within 12 months from the
end of the year are treated as short term employee
benefits. The obligation towards the same is
measured at the expected cost of accumulating
compensated absences as the additional amount
expected to be paid as a result of the unused
entitlement as at the year end.

Accumulated compensated absences, which are
expected to be availed or encashed beyond 12
months from the end of the year end are treated as
other long term employee benefits. The

Company''s liability is actuarially determined (using
the Projected Unit Credit method) at the end of
each year. Actuarial losses/gains are recognized in
the statement of profit and loss in the year in
which they arise.

Leaves under define benefit plans can be
encashed only on discontinuation of service by
employee.

3.14 Foreign Currency Transactions

a) Functional and presentation currency

Items included in the financial statements are
measured using the currency of the primary
economic environment in which the entity
operates (''the functional currency''). The financial
statements are presented in Indian rupee (INR),
which is the Company''s functional and
presentation currency.

b) Transactions and balances

On initial recognition, all foreign currency
transactions are recorded by applying to the
foreign currency amount the exchange rate
between the functional currency and the foreign
currency at the date of the transaction.
Gains/Losses arising out of fluctuation in foreign
exchange rate between the transaction date and
settlement date are recognized in the Statement of
Profit and Loss.

All monetary assets and liabilities in foreign
currencies are restated at the year end at the
exchange rate prevailing at the year end and the
exchange differences are recognized in the
Statement of Profit and Loss.

Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated
using the exchange rates at the dates of the initial
transactions.

3.15 Earnings Per Share

Basic earnings per share are calculated by dividing the

net profit or loss for the period attributable to equity
shareholders by the weighted average number of
equity shares outstanding during the period.

The weighted average numbers of equity shares are
adjusted for events such as bonus issue, bonus element
in the rights issue, share split and reverse share split
(consolidation of shares) that have changed the number
of equity shares outstanding, without corresponding
change in resources.

For the purpose of calculating diluted earnings per
share, the net profit or loss for the year attributable to
equity shareholders and the weighted average number
of shares outstanding during the period are adjusted for
the effects of all potential dilutive equity shares.

3.16 Share Based Payments

Share-based compensation benefits are provided to the
employees via the Share based long term
incentive scheme.

The cost of equity-settled transactions is determined by
the fair value at the date when the grant is made using
an appropriate valuation model. That cost is recognised,
together with a corresponding increase in share options
outstanding account in equity, over the period in which
the performance and/or service conditions are fulfilled
in employee benefits expense. The cumulative expense
recognized for equity-settled transactions at each
reporting date until the vesting date represents the
extent to which the vesting period has expired and the
Company''s best estimate of the number of equity
instruments that will ultimately vest. Expense or credit
recorded In the statement of profit and loss for a period
represents the movement in cumulative expense
recognized as at the beginning and end of that period
and is recognized in employee benefits expense.

The dilutive effect of outstanding options is reflected as
additional share dilution in the computation of diluted
earnings per share.

3.17 Share capital

Incremental costs directly attributable to the issue of
ordinary equity shares are recognized as deduction
from equity.

4. RECENT INDIAN ACCOUNTING STANDARDS (IND AS)
AND PRONOUNCEMENTS

Ministry of Corporate Affairs (“MCA") notifies new
standards or amendments to the existing standards
under Companies (Indian Accounting Standards) Rules
as issued from time to time. Ministry of Corporate Affairs
(“MCA") vide notification no. G.S.R. 291 (E) dated
7th May, 2025 made amendments in the Companies
(Indian Accounting Standards) Rules, 2015.For the year
ended March 31, 2024, MCA has not notified any new
standards or amendments to the existing standards
applicable to the Company.

The notification explains the following:

• Exchangeable definition

• Estimating the spot exchange rate when a
currency is not exchangeable into another
currency.

• Disclosures requirements when an entity estimates
a spot exchange rate because a currency is not
exchangeable into another currency

• Recognition of effect of initially applying the
amendments

These amendments are applicable for annual reporting
periods beginning on or after 1st April 2025, with
specific transitional provisions outlined.

8.1 On March 4, 2025, the Board of Directors of Getwell Medicare Solution Private Limited ("Getwell") approved issue of 170,000,000 equity shares of
face value of ? 10 each at par to the Company pursuant to a rights issue by Getwell. The Company had written put option over the shares held by
the non-controlling shareholders of Getwell in accordance with the shareholders agreement (as amended). Pursuant to the exercise of put
option by the non-controlling shareholders during the year, the Company purchased 1,200,000 equity shares of ? 10 each at a price of ?12.22 per
share. Consequent to the rights issue and purchase of shares from the non -controlling shareholders, Getwell has become a wholly owned
subsidiary of the Company w.e.f March 28, 2025.

8.2 The Company enters into business combination arrangements with few entities which include terms where the Company has a call option over
shares held by the non-controlling shareholders to be exercised in accordance with the shareholders agreement. The call option provides right
to the Company to purchase the shares held by the non-controlling shareholders in accordance with the terms of the shareholders agreement.
The fair value of such call options has been recognised as a financial asset (refer Note 10 and Note 19) with a corresponding impact to
investments / call option liability (Refer Note 28).

8.3 The Company enters into business combination arrangements with few entities which include terms where non-controlling shareholders
have put option over shares held by them to be exercised in accordance with the shareholders agreement. The put option creates an
obligation on the Company to purchase the shares held by the non-controlling shareholders in accordance with the terms of the
shareholders agreement. The fair value of such put options has been recognised as a financial liability (Refer Note 25 and Note 28) with a
corresponding impact to investments.

8.5 The Company has applied for striking off its three non-operating subsidiaries i.e. Quromed Lifesciences Private Limited, Rimedio Pharma
Private Limited and Zennx Software Solutions Private Limited. Exceptional items include provision towards impairment of investment in
these subsidiaries amounting to Rs. 0.30 million (Refer Note 8.4). Subsequent to the Balance Sheet date, Zennx Software Solutions Private
Limited has been struck offfrom Registrar of Companies on 01 May 2025.

8.6 The Board of Directors in its meeting held on March 21,2025 have approved the transfer of the 100% of issued and outstanding equity share
capital held by the Company as on the date of transfer, of two of its wholly owned subsidiaries viz., Chethana Pharma Distributors Private
Limited (''CPDPL'') and CPD Pharma Private Limited (''CPD Pharma''), to its another wholly owned subsidiary, being Rada Medisolutions Private
Limited (''Rada''). CPDPL and CPD Pharma are wholly owned subsidiaries (''WOS'') of the Company. The consideration for the transfer of shares
is Rs. 100,000 each for CPDPL and CPD Pharma. Subsequent to the Balance Sheet date, the shares of aforementioned WOS have been
transferred to Rada on 15 April 2025.

10.1 The Company has right to purchase non-controlling interest in few subsidiaries as per the respective shareholder agreements. All such options are
have been recorded by the Company at fair value with a corresponding impact to investments / call option liability (Refer Note 8 / Note 28). Based on
the evaluation of terms of contracts, wherever the risk and rewards of ownership remain with the non-controlling shareholder, non-controlling
interest has been recognised. These call options are fair valued at each reporting date, with any resulting gain or loss recognized through Profit and
Loss.The amount disclosed above is non-current portion of call option asset.The current portion ofasset is disclsosed under Note 19.

g. No class of shares have been issued as bonus shares or for consideration other than cash by the Company during the year of two years
immediately preceding the current year end.

h. No class of shares have been bought back by the Company during the year of two years immediately preceding the current year end.

i. Fresh Issue of equity share through initial public offer

During the year ended 31 March 2024, the Company has completed its Initial Public Offer ("IPO") of 1,27,20,044 equity shares of face
value of ? 10/- each comprising of (i) fresh issue of 79,50,569 equity shares at an issue price of ? 1,258 per equity share (which includes
allotment of 15,268 equity shares under employees reservation at discount of ? 119 per equity shares); (ii) an offer for sale of 47,69,475
equity shares at an issue price of ? 1,258 per equity share.

c. Conversion to equity shares

During the year ended 31st march 2024, all outstanding compulsory convertible preference shares (series A1, A2, A3, A4 and A5) have
converted to equity shares as per the formula specified in subscription agreement on occurance of certain events specified in
agreement.

d. Right Issue

During the year ended 31 March, 2024, the Company has issued and allotted 5,09,84,559 preference shares (Series A5 CCPS) of face value
INR 10 each to the eligible preference shareholders at an issue price of INR 10 per preference share aggregating to INR 509.85 million.

38 EXCEPTIONAL ITEMS

i) The Company has applied for striking off its three non-operating subsidiaries i.e. Quromed Lifesciences Private Limited, Rimedio
Pharma Private Limited and Zennx Software Solutions Private Limited. Exceptional items include provision towards impairment of
investment in these subsidiaries amounting to ? 0.30 million (Refer Note 8.4). Subsequent to the Balance Sheet date, Zennx
Software Solutions Private Limited has been struck off from Registrar of Companies on May 1,2025.

ii) The Board of Directors in its meeting held on March 21,2025 have approved the transfer of the 100% of issued and outstanding
equity share capital held by the Company as on the date of transfer, of two of its wholly owned subsidiaries viz., Chethana Pharma
Distributors Private Limited (''CPDPL'') and CPD Pharma Private Limited (''CPD Pharma''), to its another wholly owned subsidiary, being
Rada Medisolutions Private Limited (''Rada''). CPDPL and CPD Pharma are wholly owned subsidiaries (''WOS'') of the Company. The
consideration for the transfer of shares is ? 100,000 each for CPDPL and CPD Pharma. Consequent to the above, the Company has
made a provision for impairment of its investment in CPD Pharma amounting to ? 10 million (Refer Note 8.4).

iii) Exceptional items also include impairment loss towards loan given to Curever Pharma Private Limited, wholly owned subsidiary of the
Company amounting to ? 364.69 million and interest receivable on the said loan amounting to ? 95.82 million (Refer Note 9 and 19).

43 COMMITMENTS

There are no commitments as at 31 March 2025 and 31 March 2024.

44 SEGMENT REPORTING

An operating segment is a component of Company that engages in business activities from which it earns revenues and incurs expenses,
including revenues and expenses that relate to transactions with any of the Company''s other components and for which discrete financial
information is available.

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker
("CODM") of the Company. The Chief Executive Officer and Chief Operating Officer of the Company acts as the (CODM). The Company
operates only in one business segment i.e. trading of pharmaceutical and surgical products and hence, the Company has only one separate
reportable segments as per Ind AS 108"Operating Segments".

45 CAPITAL MANAGEMENT

For the purpose of the Company''s capital management, capital includes issued equity capital and equity reserves attributable to the equity
holders of the Company. The primary objective of the Company''s capital management is to safeguard the Company''s ability to remain as a
going concern and maximise the shareholder value. The Company manages its capital structure and makes adjustments in light of changes
in economic conditions, annual operating plans and long term and other strategic investment plans. In order to maintain or adjust the
capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.
The current capital structure of the Company is equity based with no financing through borrowings. The Company is not subject to any
externally imposed capital requirement. No changes were made in the objectives, policies or processes for managing capital during the year
ended 31 March 2025 and 31 March 2024.

46 FAIR VALUE MEASUREMENTS

A. Accounting classification and fair values

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the
fair value hierarchy. It does not include fair value information for financial assets and financial liabilities not measured at fair value if
the carrying amount is a reasonable approximation of fair value.

B. The carrying amounts of trade receivables, trade payables, deposits, other receivables, cash and cash equivalent including other
current bank balances and other liabilities including deposits, creditors for capital expenditure, etc. are considered to be the same as
their fair values, due to current and short term nature of such balances.

The Company has engaged the services of experts for determining the fair valuation of call option asset and put option liability. The
fair value of call option and put option has been calculated by external valuation experts using ''Simulation'' method."

C. Fair Value Hierarchy

The fair value of financial instruments as referred to above have been classified into three categories depending on the inputs used
in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities
(Level 1 measurements) and lowest priority to unobservable inputs (Level 3 measurements).

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments and
mutual funds that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued using
the closing price as at the reporting year.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques
which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs
required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

47 FINANCIAL RISK MANAGEMENT

The company has in place comprehensive risk management policy in order to identify measure, monitor and mitigate various risks
pertaining to its business. Along with the risk management policy, an adequate internal control system, commensurate to the size and
complexity of its business, is maintained to align with the philosophy of the company. Together they help in achieving the business goals and
objectives consistent with the company''s strategies to prevent inconsistencies and gaps between its policies and practices. The Board of
Directors/committtees reviews the adequacy and effectiveness of the risk management policy and internal control system. The company''s
financial risk management is an integral part of how to plan and execute its business strategies.

The company has exposure to the following risks arising from financial instruments:

• Credit risk

• Liquidity risk and

• Market risk

(A) Credit Risk

Credit risk is the risk of financial loss to the company if a customer or counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the company''s trade and other receivables and cash and cash equivalents. The carrying
amounts offinancial assets represent the maximum credit risk exposure.
i) Trade and Other Receivables

Trade receivables are typically unsecured and are derived from revenue earned from customers located in India. Credit risk has
always been managed by the company through credit approvals, establishing credit limits and continuously monitoring the
creditworthiness of customers to which the company grants credit terms in the normal course of business.

The company uses Expected Credit Loss model to assess the impairment loss. The company computes the expected credit loss allowance as
per simplified approach for trade receivables based on available external and internal credit risk factors such as the ageing of its dues, market
information about the customer and the company''s historical experience for customers. The company has used a practical expedient by
computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account
historical credit loss experience and is based on the ageing of the receivable days and the rates as given in the provision matrix.

ii) Loans and financial assets measured at amortized cost: Loans and advances given comprises of inter company loans hence the
risk of default from these companies are remote. The Company monitors each loans and advances given and makes any specific
provision wherever required.

iii) Cash and cash equivalents and other bank balance: The company held cash and cash equivalent and other bank balance of ?
2,233.86 million as at 31 March 2025 (31 March 2024 : ? 7,923.52 million). The same are held with bank and financial institution
counterparties with good credit rating. Also, company invests its short term surplus funds in bank fixed deposit which carry no
market risks for short duration, therefore does not expose the company to credit risk.

iv) Others: Apart from trade receivables ,loans and cash and bank balances , the company has no other financial assets which carries
any significant credit risk.

(B) Liquidity risk: Liquidity risk is the risk that the company will encounter difficulty in meeting the obligations associated with its
financial liabilities that are settled by delivering cash or another financial asset. The company''s approach to managing liquidity is to
ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed
conditions, without incurring unacceptable losses or risking damage to the company''s reputation. Management monitors rolling
forecasts of the company''s liquidity position and cash and cash equivalents on the basis of expected cash flows.

(i) Maturities of financial liabilities: The following are the remaining contractual maturities of financial liabilities at the reporting
date. The amounts are gross and undiscounted, and include contractual interest payments.

(C) Market Risk

Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and equity prices - will affect the
company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control
market risk exposures within acceptable parameters, while optimising the return. The company''s exposure to, and management of, these
risks is explained below.

(i) Foreign currency risk

Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange
rates. The company caters mainly to the Indian Market . Most of the transactions are denominated in the company''s functional currency i.e.
Rupees. Hence the company is not materially exposed to Foreign Currency Risk.

51 EMPLOYEE STOCK OPTION PLAN (ESOP)

The board vide its resolution dated 26 August 2023 approved Entero Employee Stock Option Plan 2023 for granting Employee Stock Options
in form of equity shares linked to the completion of a minimum year of continued employment to the eligible employees of the Company,
monitored and supervised by the Board of Directors. The employees can purchase equity shares by exercising the options as vested at the
price specified in the grant. Once vested, the options remain exercisable for a year of 8 years during the course of employment with the
Company or within a year of 2 years from seperation subject to conditions mentioned in the plan. Options are granted under the plan for no
consideration and carry no dividend or voting rights. When exercisable, each option is convertible into one number of equity share. The
exercise price of the share options is equal to the market price of the underlying shares on the date of grant. The contractual term of the share
options is 4 years and there are no cash settlement alternatives for the employees.

57 OTHER STATUTORY INFORMATION:

(i) Details of benami property held: The Company do not have any Benami property, where any proceeding has been initiated or
pending against the Company for holding any Benami property.

(ii) Relationships with struck off companies: The Company do not have any transactions with companies struck off.

(iii) Registration of charges or satisfaction with Registrar of Companies: The Company do not have any charges or satisfaction
which is yet to be registered with ROC beyond the statutory period.

(iv) Details of crypto currency or virtual currency: The Company have not traded or invested in Crypto currency or Virtual Currency
during the financial year.

(v) Utilisation of borrowings availed from banks and financial institutions: The Company have not advanced or extended loan or
invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the
Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
company (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

The Company have not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the
understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the

Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(vi) Undisclosed Income: The Company does not have any undisclosed income which is not recorded in the books of account that has
been surrendered or disclosed as income during the year (previous year) in the tax assessments under the Income Tax Act, 1961
(such as, search or survey or any other relevant provisions of the I ncomeTax Act, 1961).

(vii) Wilfull defaulter: The Company has not been declared wilful defaulter by any bank or financial institution or by any government
authorities.

(viii) Compliance with number of layers of companies: The company has complied with the number of layers prescribed under clause
(87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017.

(ix) Compliance with approved scheme(s) of arrangements: The company has not entered into any scheme of arrangement which
has an accounting impact on current or previous financial year.

(x) Title deeds of immovable properties not held in name of the company: There are no immovable properties held by the
company (other than properties where the company is the lessee and the lease arrangements are duly executed in favour of the
lessee) .

(xi) Valuation of PPE, intangible assets and Investment property: The company has not revalued its property, plant and equipment
(Including Right of use assets) or intangible assets or both during the current or previous year.

(xii) Audit trail: The Ministry of Corporate Affairs (MCA) has prescribed a new requirement for companies under the proviso to Rule 3(1)
of the Companies (Accounts) Rules, 2014 inserted by the Companies (Accounts) Amendment Rules 2021 requiring companies,
which uses accounting software for maintaining its books of accounts, shall use only such accounting software which has a feature
of recording audit trail of each and every transaction, creating an edit log of each change made in the books of accounts along with
the dates when such changes were made and ensuring that the audit trail cannot be disabled.

The Company used four accounting softwares for maintaining its books of account, which has a feature of recording audit trail
facility, except that audit trail feature was not enabled throughout the year for one accounting software. In respect of two
accounting softwares, no audit trail feature was enabled at the database level to log any direct data changes
Further, where enabled, audit trail feature has been operated for all relevant transactions recorded in the accounting softwares.
Also, we did not come across any instance of audit trail feature being tampered with in respect of such accounting software.
Additionally, the audit trail of prior years has been preserved by the Company as per the statutory requirements for record retention
to the extent it was enabled and recorded in respective years.

(xiii) Backup of books of accounts: The company uses software / IT applications to maintain its books of accounts and other books and
papers in electronic mode ("Electronic records"). During the year, the Company has maintained backups of these electronic records
on server physically located in India on daily basis, as required by Companies (Accounts) Rules, 2014 (as amended).

58. The financial statements were authorised for issue by the company''s board of directors on 27 May 2025.

59 PREVIOUS YEAR FIGURES HAVE BEEN REGROUPED/ RECLASSIFIED, WHERE NECESSARY, TO CONFORM TO CURRENT

YEAR''S CLASSIFICATION.

As per our report of even date For and on behalf of the Board of Directors of

For M S K A & Associates Entero Healthcare Solutions Limited

Chartered Accountants CIN: L74999HR2018PLC072204

Firm Registration No.:105047W

Amrish Vaidya Prabhat Agrawal Prem Sethi Balakrishnan Natesan Kaushik Sanu Kapoor

Partner Managing Director & CEO Whole Time Director & COO Chief Financial Officer Company Secretary

Membership No: 101739 DIN: 07466382 DIN: 07077034 Membership No.: 109347 Membership No.: A14065

Place: Mumbai Place: Mumbai Place: Mumbai Place: Mumbai Place: Mumbai

Date: 27 May 2025 Date: 27 May 2025 Date: 27 May 2025 Date: 27 May 2025 Date: 27 May 2025

---

Mar 31, 2024

3.9 PROVISIONS AND CONTINGENT LIABILITIES

A provision is recognized when the Company has a present obligation (legal or constructive) as a result of a past event; it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and in respect of which a reliable estimate can be made of the amount of the obligation. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the reporting date. These are reviewed at each reporting date and adjusted to reflect the current best estimates. The Company creates a provision when there is a present obligation as a result of a past event that probably requires an outflow of resources embodying economic benefits and a reliable estimate can be made of the amount of the obligation.

A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that probably will not require an outflow of resources embodying economic benefits or where a reliable estimate of the obligation cannot be made.

Contingent assets are neither recorded nor disclosed in the financial statements.

3.10 CASH AND CASH EQUIVALENTS

Cash and cash equivalents in the balance sheet comprise cash on hand, cash at banks and short-term investments with an original maturity of three months or less, which are subject to an insignificant risk of changes in value and bank overdrafts are shown within borrowings in current liabilities in the balance sheet.

Cash and cash equivalents for the purposes of cash flow statement comprise cash on hand and cash at banks and short-term investments with an original maturity of three months.

3.11 FINANCIAL INSTRUMENTS

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

(A) Financial assets

(i) Recognition and Initial measurement

At initial recognition, financial asset is measured at its fair value plus or minus, in the case of a financial asset not "at fair value through profit or loss” are measured at transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in statement of profit and loss.

(ii) Classification and subsequent measurement

For purposes of subsequent measurement, financial assets are classified in following categories:

a) at amortized cost; or

b) at fair value through other comprehensive income; or

c) at fair value through profit or loss.

The classification depends on the entity''s business model for managing the financial assets and the contractual terms of the related cash flows.

Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortized cost. Interest income from these financial assets is included in finance income using the effective interest rate method (EIR).

Fair value through other comprehensive income (FVOCI): Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets'' cash flows represent solely

payments of principal and interest, are measured at fair value through other comprehensive income (FVOCI). Movements in the carrying amounts are taken through Other Comprehensive Income (''OCI''), except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognized in statement of profit and loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in OCI is reclassified from equity to statement of profit and loss and recognized in other gains/ (losses). Interest income from these financial assets is included in "Other income” using the effective interest rate method.

Fair value through profit or loss (FVTPL): Assets that do not meet the criteria for amortized cost or FVOCI are measured at fair value through statement of profit and loss. Interest and dividend income from these financial assets is included in "Other income”. Net gains and losses, including any interest or dividend income are recognized in statement of profit and loss.

Equity instruments: All equity investments in scope of Ind AS 109 are measured at fair value. Equity instruments which are held for trading and contingent consideration recognised by an acquirer in a business combination to which Ind AS 103 applies are classified as FVTPL. For all other equity instruments, the Company may make an irrevocable election to present in OCI subsequent changes in the fair value in other comprehensive income. The Company makes such election on an instrument-byinstrument basis. The classification is made on initial recognition and is irrevocable.

If the Company decides to classify an equity instrument as FVOCI, then all fair value changes on the instrument, excluding dividends, are recognized in the OCI. There is no recycling of the amounts from OCI to statement of profit and loss, even on sale of investment. However, the Company may transfer the cumulative gain or loss within equity.

Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in the statement of profit and loss.

(iii) Impairment of financial assets

In accordance with Ind AS 109, Financial Instruments, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on financial assets that are measured at amortized cost and FVOCI.

For recognition of impairment loss on financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If in subsequent years, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognizing impairment loss allowance based on 12 month ECL.

Life time ECLs are the expected credit losses resulting from all possible default events over the expected life of a financial instrument. The 12 month ECL is a portion of the lifetime ECL which results from default events that are possible within 12 months after the year end.

ECL is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the entity expects to receive (i.e. all shortfalls), discounted at the original EIR. When estimating the cash flows, an entity is required to consider all contractual terms of the financial instrument (including prepayment, extension etc.) over the expected life of the financial instrument. However, in rare cases when the expected life of the financial instrument cannot be estimated reliably, then the entity is required to use the remaining contractual term of the financial instrument.

In general, it is presumed that credit risk has significantly increased since initial recognition if the payment is more than 90 days past due.

ECL impairment loss allowance (or reversal) recognized during the year is recognized as income/expense in the statement of profit and loss. In balance sheet ECL for financial assets measured at amortized cost is presented as an allowance, i.e. as an integral part of the measurement of those assets in the balance sheet. The allowance reduces the net carrying amount. Until the asset meets write off criteria, the Company does not reduce impairment allowance from the gross carrying amount.

(iv) Derecognition of financial assets

A financial asset is derecognized only when

a) the right to receive cash flows from the financial asset is transferred or

b) retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual obligation to pay the cash flows to one or more recipients.

Where the financial asset is transferred then in that case financial asset is derecognized only if substantially all risks and rewards of ownership of the financial asset is transferred. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognized.

(B) Financial liabilities

(i) Recognition and Initial measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss and at amortized cost, as appropriate.

All financial liabilities are recognized initially at fair value and, in the case of borrowings and payables, net of directly attributable transaction costs.

(ii) Subsequent measurement

The measurement of financial liabilities depends on their classification, as described

Financial liabilities at fair value through profit or loss: Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments. Gains or losses on liabilities held for trading are recognized in the statement of profit and loss.

Loans and borrowings:

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in Statement of profit and loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the Statement of profit and loss.

(iii) Derecognition of Financial liability

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit and loss as finance costs.

(C) Embedded Derivatives

An embedded derivative is a component of a hybrid (combined) instrument that also includes a non-derivative host contract - with the effect that some of the cash flows of the combined instrument vary in a way similar to a standalone derivative. Derivatives embedded in all other host contracts are separated if the economic characteristics and risks of the embedded derivative are not closely related to the economic characteristics and risks of the host and are measured at fair value through profit or loss. Embedded derivatives closely related to the host contracts are not separated.

Reassessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss.

(D) Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the balance sheet where there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Company or the counterparty.

3.12 EMPLOYEE BENEFITS

(a) Short-term obligations

Liabilities for wages and salaries, including nonmonetary benefits that are expected to be settled wholly within 12 months after the end of the year in which the employees render the related service are recognized in respect of employees'' services up to the end of the year and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.

(b) Other long-term employee benefit obligations

(i) Defined contribution plan

Provident Fund: Contribution towards provident fund is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart from the contributions made on a monthly basis which are charged to the Statement of profit and loss.

Employee''s State Insurance Scheme:

Contribution towards employees'' state insurance scheme is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart

from the contributions made on a monthly basis which are charged to the statement of profit and loss.

The Company has no further obligations under these plans beyond its monthly contributions.

(ii) Defined Benefit Plans

Gratuity: The Company provides for gratuity, a defined benefit plan (covering eligible employees in accordance with the Payment of Gratuity Act, 1972. The Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee''s salary. The Company''s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year. Actuarial losses/gains are recognized in the other comprehensive income in the year in which they arise.

Costs comprising service cost (including current and past service cost and gains and losses on curtailments and settlements) and net interest expense or income is recognized in profit or loss.

The obligation recognized in the balance sheet represents the actual deficit or surplus in the Company''s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.

Compensated Absences: Accumulated

compensated absences, which are expected to be availed or encashed within 12 months from the end of the year are treated as short term employee benefits. The obligation towards the same is measured at the expected cost of accumulating compensated absences as the additional amount expected to be paid as a result of the unused entitlement as at the year end.

Accumulated compensated absences, which are expected to be availed or encashed beyond

12 months from the end of the year end are treated as other long term employee benefits. The Company''s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year. Actuarial losses/gains are recognized in the statement of profit and loss in the year in which they arise.

Leaves under define benefit plans can be encashed only on discontinuation of service by employee.

3.13 FOREIGN CURRENCY TRANSACTIONS

(a) Functional and presentation currency

Items included in the financial statements are measured using the currency of the primary economic environment in which the entity operates (''the functional currency''). The financial statements are presented in Indian rupee (INR), which is the Company''s functional and presentation currency.

(b) Transactions and balances

On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction. Gains/Losses arising out of fluctuation in foreign exchange rate between the transaction date and settlement date are recognised in the Statement of profit and loss.

All monetary assets and liabilities in foreign currencies are restated at the year end at the exchange rate prevailing at the year end and the exchange differences are recognised in the Statement of profit and loss.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions.

3.14 EARNINGS PER SHARE

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

The weighted average numbers of equity shares are

adjusted for events such as bonus issue, bonus element in the rights issue, share split and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all potential dilutive equity shares.

3.15 SHARE BASED PAYMENTS

Share-based compensation benefits are provided to the employees via the Share based long term incentive scheme.

The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model. That cost is recognised, together with a corresponding increase in share options outstanding account in equity, over the period in which the performance and/or service conditions are fulfilled in employee benefits expense. The cumulative expense

recognized for equity-settled transactions at each reporting date until the vesting date represents the extent to which the vesting period has expired and the Company''s best estimate of the number of equity instruments that will ultimately vest. Expense or credit recorded In the statement of profit and loss for a period represents the movement in cumulative expense recognized as at the beginning and end of that period and is recognized in employee benefits expense.

The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

NOTE 4 RECENT INDIAN ACCOUNTING STANDARDS (IND AS) AND PRONOUNCEMENTS_

Ministry of Corporate Affairs ("MCA”) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended 31st March, 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.

d. Rights, preferences and restrictions attached to shares

0.0001% Compulsory Convertible Preference shares (CCPS)

Terms of Conversion :

(a) The holders of the CCPS may convert the CCPS in whole or part into 1 (one) Equity Share at any time before the expiry of 19 (nineteen) years from the date of issue of the same subject to the adjustments as mentioned in Articles of Association, and the provisions of the Shareholders'' Agreement. In the event the conversion of CCPS entitles the holder of CCPS to any fraction of an Equity Share, then such fraction shall be rounded up to the nearest whole number.

(b) The holders of CCPS shall, at any time prior to 19 (nineteen) years from the date of issue of the same, be entitled to call upon the Company to convert all or any of the CCPS. The CCPS, or any of them, if not converted earlier, shall automatically convert into Equity Shares at the then applicable conversion rate.

Senior Rights: The holders of A1 CCPS, A2 CCPS and A3 CCPS shall rank senior to Series A4 CCPS and all other preference shares and other instruments that are outstanding and which may be issued by the Company from time to time.

Meeting and voting rights: The holders of CCPS shall be entitled to attend meetings of all Shareholders of the Company and entitled to such voting rights as If on a Converted Basis, as may be permissible under Applicable Law.Accordingly, but subject to adjustments as set forth herein, the holders of CCPS shall be entitled to the same number of votes for each CCPS as a holder of 1 (one) Equity Share would have on each Equity Share held, provided however that in the event of any adjustment in conversion the number of votes associated with each CCPS will change accordingly. The holders of CCPS shall be entitled to vote on all such matters which affect their rights directly or indirectly.

g. Conversion to equity shares

During the year ended 31st March, 2024, all outstanding compulsory convertible preference shares (series A1, A2, A3, A4 and A5) have converted to equity shares as per the formula specified in the amended subscription agreement on occurance of certain events specified in agreement.

h. Right Isuue

For the year ended 31st March, 2024, the Company has issued and allotted 5,09,84,559 compulsorily convertible preference shares (Series A5 CCPS) of face value '' 10 each to the eligible preference shareholders at an issue price of '' 10 per preference share aggregating to '' 509.85 million.

During the year ended 31st March, 2023, the Company has issued and allotted 4,46,23,974 compulsorily convertible preference shares ( Series A1 CCPS: 3,00,00,000, Series A2 CCPS: 1,02,43,898, Series A3 CCPS: 1,96,833 Series A4 CCPS: 41,83,243) of face value '' 10/- each to the eligible preference shareholders at an issue price of '' 10 per preference share aggregating to '' 1017.28 million.

Term Loan and Non convertible debentures:

(a) During the year, the Company issued 4,500 secured, unlisted, redeemable, non-convertible debentures of face value of Rs.

1.00. 000/- (Indian Rupees One Lakhs Only) each ("NCDs”) aggregating to Rs. 45,00,00,000/- (Indian Rupees Forty-Five Crores Only) in the month of April 2023. These were secured by first ranking and exclusive charge by way of pledge over shares of the following subsidiaries, held by the Company:

1. Saurashtra Medisolutions Private Limited

2. S.S. Pharma Traders Private Limited

3. SVS Lifesciences Private Limited

A first ranking and pari passu charge by way of hypothecation, over all, both present and future, of the movable assets, current assets, insurance policies, receivables and any amount owed from any source or person, all other assets held by the Company from time to time as more particularly described in detail in the relevant Transaction Documents;

The Non Convertible debentures bore a cash coupon rate of 12% pa (Implicit rate of return 14.09%) payable monthly commencing from 6th April, 2023 (Date of Allotment) and 50% each at the end of 30 Months and 36 Months respectively shall be redeemed from the date of allotment. These debentures are redeemed in the month of March 2024.

(b) During the year, the Company issued 4,500 secured, unlisted, redeemable, non-convertible debentures of face value of Rs.

1.00. 000/- (Indian Rupees One Lakhs Only) each ("NCDs”) aggregating to Rs. 45,00,00,000/- (Indian Rupees Forty-Five Crores Only) in the month of June 2023. These were secured by first ranking and exclusive charge by way of pledge over shares of the following subsidiaries, held by the Company:

1. Swami Medisolutions private Limited

2. Atreja Healthcare Solutions private Limited

3. City Pharma Distributors private limited

A first ranking and pari passu charge by way of hypothecation, over all, both present and future, of the movable assets, current assets, insurance policies, receivables and any amount owed from any source or person, all other assets held by the Company from time to time as more particularly described in detail in the relevant Transaction Documents;

The Non Convertible debentures bore a cash coupon rate of 8% pa (Implicit rate of return 16%) payable monthly commencing from 30th June, 2023 (Date of Allotment) and 50% each at the end of 30 Months and 36 Months respectively shall be redeemed from the date of allotment. These debentures are redeemed in the month of March 2024.

(c) The term loans included in the current borrowings of the Company were secured against the first charge on all current assets, movable fixed assets and Cash collateral ranging from 5.00% - 20.00% (31st March, 2023: 5.00% - 20.00%) in the form of a lien marked fixed deposit placed with bank. These loans carried interest from 12.00% to 14.00% p.a. and are repayable within one year and hence classified as current as on the reporting date.

These loans were repaid before 31st March, 2024.

Outstanding balance at 31st March 2024 - Nil (31st March, 2023, 635 Million).

(d) The Term loans included in the non-current borrowings of the Company were secured against the first charge on all current assets, movable fixed assets and Cash collateral of 10.00% (31st March, 2023: 10.00%) in the form of a lien marked fixed deposit placed in a bank. These loans carried interest from 13.50% p.a. and are repayable beyond one year and hence classified as noncurrent as on the reporting date.

These loans were repaid before 31st March, 2024

Outstanding balance at 31st March 2024 - Nil (31st March, 2023, 280 Million)

NOTE 4p| COMMITMENTS_

There are no capital commitments as at 31st March, 2024 and 31st March, 2023.

NOTE 4l| SEGMENT REPORTING_

An operating segment is a component of Company that engages in business activities from which it earns revenues and incurs expenses, including revenues and expenses that relate to transactions with any of the Company''s other components and for which discrete financial information is available.

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker ("CODM”) of the Company. The Chief Executive Office and Chief Operating Officer of the Company acts as the (CODM). The Company operates only in one business segment i.e. trading of pharmaceutical and surgical products and hence, the Company has only one separate reportable segments as per Ind AS 108 "Operating Segments”.

NOTE 42| CAPITAL MANAGEMENT_

For the purpose of the Company''s capital management, capital includes issued equity capital, compulsorily convertible preference shares (Converted to Equity share on 27th January, 2024) and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company''s capital management is to safeguard the Company''s ability to remain as a going concern and maximise the shareholder value. The Company manages its capital structure and makes adjustments in light of changes in economic conditions, annual operating plans and long term and other strategic investment plans. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares. The current capital structure of the Company is equity based with no financing

C. Fair Value Hierarchy

The fair value of financial instruments as referred to above have been classified into three categories depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs (Level 3 measurements).

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments and mutual funds that have quoted price. The fair value of all equity instruments which are traded on the stock exchanges are determined using the closing price of the respective instrument as at the reporting date.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities included in level 3.

NOTE 44| FINANCIAL RISK MANAGEMENT_

The Company has in place comprehensive risk management policy in order to identify measure, monitor and mitigate various risks pertaining to its business. Along with the risk management policy, an adequate internal control system, commensurate to the size and complexity of its business, is maintained to align with the philosophy of the Company. Together they help in achieving the business goals and objectives consistent with the company''s strategies to prevent inconsistencies and gaps between its policies and practices. The Board of Directors/committees reviews the adequacy and effectiveness of the risk management policy and internal control system. The Company''s financial risk management is an integral part of how to plan and execute its business strategies. The company has exposure to the following risks arising from financial instruments:

• Credit risk

• Liquidity risk and

• Market risk

(A) Credit Risk

Credit risk is the risk of financial loss to the company if a customer or a counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the company''s trade and other receivables and cash and cash equivalents. The carrying amounts of financial assets represent the maximum credit risk exposure.

i) Trade and Other Receivables

Trade receivables are typically unsecured and are derived from revenue earned from customers located in India. Credit risk has always been managed by the company through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the company grants credit terms in the normal course of business.

(B) Liquidity risk

Liquidity risk is the risk that the company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The company''s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the company''s reputation. Management monitors rolling forecasts of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash flows.

(C) Market Risk

Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return. The Company''s exposure to, and management of, these risks is explained below.

(i) Foreign currency risk

Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates. The Company caters mainly to the Indian Market . Most of the transactions are denominated in the company''s functional currency i.e. Rupees. Hence the Company is not materially exposed to Foreign Currency Risk.

(ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cashflows of a financial instrument will fluctuate because of changes in market interest rates.

NOTE 48| EMPLOYEE STOCK OPTION PLAN (ESOP)_

The board vide its resolution dated 26th August, 2023 approved Entero Employee Stock Option Plan 2023 ("The Plan”) for granting Employee Stock Options in the form of equity shares linked to the completion of a minimum year of continued employment to the eligible employees of the Company, monitored and supervised by the Board of Directors. The employees can purchase equity shares by exercising the options as vested at the price specified in the plan.

Once vested, the options remain exercisable for 8 years during the course of employment with the Company or within a period of 2 years from seperation subject to conditions mentioned in the Plan.

Options are granted under the plan for no consideration and carry no dividend or voting rights. When exercisable, each option is convertible into one number of equity share. The exercise price of the share options is equal to the market price of the underlying shares on the date of grant. The contractual term of the share options is 4 years and there are no cash settlement alternatives for the employees.

NOTE 49| UTILISATION OF MONEY RAISED THROUGH PUBLIC ISSUE_

During the year ended 31st March, 2024, the Company has completed its Initial Public Offer ("IPO”) of 12,720,044 equity shares of face value of '' 10/- each comprising of (i) fresh issue of 79,50,569 equity shares at an issue price of '' 1,258 per equity share (which includes allotment of 15,268 equity shares under employees reservation at discount of '' 119 per equity shares); (ii) an offer for sale of 47,69,475 equity shares at an issue price of '' 1,258 per equity share. The Company also listed 30,773,723 existing shares of face value of '' 10/- each. As a result 43,493,767 equity shares of the Company were listed on BSE Limited ("BSE”) and National Stock Exchange of India Limited ("NSE”) on 16th February, 2024. The utilization of the proceeds (net of IPO expenses) as on 31st March, 2024 is summarized as below:

NOTE 5p| DISCLOSURE REQUIRED FOR BORROWING BASED ON SECURITY OF CURRENT ASSETS_

The Company has not been sanctioned working capital limits in excess of '' 50 million, in aggregate from banks or financial institutions on the basis of security of current assets.

NOTE 5l| EVENTS OCCURRED AFTER THE BALANCE SHEET DATE_

The Company evaluates events and transactions that occur subsequent to the balance sheet date but prior to the approval of financial statements to determine the necessity for recognition and/or reporting of subsequent events and transactions in the financial statements. After the reporting date, The Company has entered into a share purchase agreement for purchase of 8000 equity shares at '' 10 each (80% stake) in Avenir Lifecare Pharma Private Limited (ALPPL) on 7th May, 2024, resulting in ALPPL becoming the subsidiary of the company.

NOTE 56| OTHER STATUTORY INFORMATION:_

(i) Details of benami property held

The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

(ii) Relationships with struck off companies

The Company does not have any transactions with companies struck off.

(iii) Registration of charges or satisfaction with Registrar of Companies

The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

(iv) Details of crypto currency or virtual currency

The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year ended 31st March, 2024.

(v) Utilisation of borrowings availed from banks and financial institutions

The Company has not advanced or extended loan or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries)

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

The Company have not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(vi) Undisclosed Income

The Company does not have any undisclosed income which is not recorded in the books of account that has been surrendered or disclosed as income during the year (previous year) in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

(vii) Wilful defaulter

The Company has not been declared wilful defaulter by any bank or financial institution or by any government authorities.

(viii) Compliance with number of layers of companies

The company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017.

(ix) Compliance with approved scheme(s) of arrangements

The company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.

(x) Title deeds of immovable properties not held in name of the company

The title deeds of all the immovable properties (other than properties where the company is the lessee and the lease arrangements are duly executed in favour of the lessee) are held in the name of the Company during the current and previous year.

(xi) Valuation of PPE, intangible assets and Investment property

The company has not revalued its property, plant and equipment (Including Right of use assets) or intangible assets or both during the current or previous year.

(xii) Audit trail

The Ministry of Corporate Affairs (MCA) has prescribed a new requirement for companies under the proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 inserted by the Companies (Accounts) Amendment Rules 2021 requiring companies, which uses accounting software for maintaining its books of accounts, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in the books of accounts along with the dates when such changes were made and ensuring that the audit trail cannot be disabled.

The Company used an accounting software for revenue, billing and receivables, purchase and payables and inventory management during the year ended 31st March, 2024, which has a feature of recording the audit trail (edit log) facility. The same has been enabled at the application as well as database level except that the database did not capture complete log of changes, wherein it did not capture one particular characteristics of the changes made.

Further, the audit trail feature operated throughout the year for all the relevant transactions recorded in the software application, except for the log of one particular characteristics of the changes made during the year for all the relevant transactions recorded therein. Further there were no instances of audit trail feature being tampered with in respect of this software.

(xiii) Backup of books of accounts

The company uses software applications to maintain its books of accounts and other books and papers in electronic mode ("Electronic records”). During the year, the Company has maintained backups of these electronic records on server physically located in India on daily basis, as required by Companies (Accounts) Rules, 2014 (as amended).

Previous year figures have been regrouped/ reclassified, where necessary, to conform to this year''s classification.

The accompanying notes are an integral part of the standalone financial statements.

As per our report of even date

For M S K A & Associates For and on behalf of the Board of Directors

Chartered Accountants Entero Healthcare Solutions Limited

Firm''s Registration No: 105047W CIN: L74999HR2018PLC072204

Vaijayantimala Belsare Prabhat Agrawal Prem Sethi

Partner Managing Director & CEO Whole Time Director & COO

Membership No: 049902 DIN: 07466382 DIN: 07077034

Jayant Prakash CV Ram

Company Secretary Chief Financial Officer

Membership No: FCS-6742 Membership No: 206013

Mumbai Mumbai Mumbai

29th May, 2024 29th May, 2024 29th May, 2024