Notes to Accounts of Hi-Klass Trading & Investment Ltd.

Mar 31, 2025

Note 2 : Disclosure pursuant to Note no. S(e) of Division III of Schedule III to the Companies Act, 2013 Terms and rights attached to equity shares

Equity Shares: The Company has issued one class of equity shares having face value of Rs. 5/- per share. Each shareholder is eligible for one vote per share held.

The dividend proposed by the Board of Directors, if any, is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of Interim Dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

The shareholders have all other rights as available to the Equity Shareholders as per the provisions of Companies Act, 2013 read together with the Memorandum of Association and Articles of Association of the Company, as applicable.

Note 3 : Disclosure pursuant to Note no. S(f) of Division III of Schedule III to the Companies Act, 2013

(i) No one is directly holding more than 50% of total paid up share capital of the Company.

Note 5 : Disclosures pursuant to Note no. S(h), (i), (j), (k) and (l) of Division III of Schedule III to the Companies Act, 2013 are not applicable to the Company and hence not given.

Note 6 : Disclosures pursuant to Note no. S(m) of Division III of Schedule III to the Companies Act, 2013 Capital Management

The objective of Company''s Capital Management is to ensure that the investment''s are made to enhance share holder value and results in healthy capital ratio, growth and continuity of business. No changes have been made to the objectives, policies and processes from the previous years.

Nature and purpose of each reserve:

Capital Reserve

Capital Reserve represents a reserve created out of capital profits which are not available for distribution as dividend.Capital Reserve has been created out of the forfeiture of equity shares due to non-payment of allotment or call money. The amount forfeited (to the extent not reissued) is transferred to Capital Reserve.

Statutory reserves

The Company is required to create a reserve in accordance with the provisions of Section 45-IC of the Reserve Bank of India Act, 1934. Accordingly 20% of the profits after tax for the year is transferred to this reserve at the end of every reporting period.

Securities premium

The amount received in excess of face value of the equity shares is recognised in Securities Premium.

Retained earnings

Retained earnings are the profits that the Company has earned till date, less any transfer to general reserves, dividends and other distributions made to the shareholders.

Other Comprehensive Income (OCI)

This represents the cumulative gains and losses arising on the revaluation of financial instruments measured at fair value through other comprehensive income, under an irrevocable option, net of amounts reclassified to Retained earnings when such assets are disposed off, if any.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised directly in other comprehensive income.

Note : The Company has undertaken derivative transactions (Futures & Options) during the year. The net loss of ^22.78 lakhs during the year from such transactions has been recognized under "Net loss on fair value changes" in the Statement of Profit and Loss, in accordance with the requirements of Ind AS 109 - Financial Instruments.

All derivative positions have been squared off during the year, and accordingly, there are no open positions as at 31st March 2025. Hence, no amounts are reported under derivative financial assets or liabilities in the financial statements as at the reporting date.

Speculative Transactions

During the year, the Company has incurred a loss of ^27.67 lakhs from speculative transactions, classified under ''Other Expenses''. These relate to transactions not forming part of the regular business activities and not intended for delivery.

Undisclosed Income

There are no transactions which are not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessment under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

Details of Crypto Currency or Virtual Currency

The Company has not traded or invested in Crypto currency or Virtual currency during the year.

(b) Fair value hierarchy

The Group determines fair values of its financial instruments according to the following hierarchy:

Level 1: Valuation based on quoted market price: Financial instruments with quoted prices for identical instruments in active markets that the Company can access at the measurement date.

Level 2: Valuation based on using observable inputs: Financial instruments with quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in inactive markets and financial instruments valued using models where all significant inputs are observable.

Level 3: Valuation technique with significant unobservable inputs: - financial instruments valued using valuation techniques where one or more significant inputs are unobservable.

(c) Fair value of assets and liabilities measured at cost/amortised cost

The carrying amount of financial assets and financial liabilities measured at amortised cost are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amount would be significantly different from the values that would be eventually received or settled. Management assessed that fair values of cash and cash equivalents, other bank balances, other financial assets and other financial liabilities approximate their carrying amounts of these instruments.

32 Financial risk management

The Company is a Non-Deposit taking Non-Banking Financial Company registered with the Reserve Bank of India (the ''RBI'') (classified as Middle Layer). On account of it''s business activities it is exposed to various financial risks associated with financial products such as credit or default risk, market risk, interest rate risk, liquidity risk and inflationary risk. However, the Company has a robust financial risk management system in place to identify, evaluate, manage and mitigate various risks associated with its financial products to ensure that desired financial objectives are met. The Company''s senior management is responsible for establishing and monitoring the risk management framework within its overall risk management objectives and strategies. Such risk management strategies and objectives are established to identify and analyse potential risks faced by the Company, set and monitor appropriate risk limits and controls, periodically review the changes in market conditions and assess risk management performance.

(a) Credit risk

This risk is common to all investors who invest in bonds and debt instruments and it refers to a situation where a particular bond issuer is unable to make the expected principal payments, interest rate payments, or both. Similarly, a lender bears the risk that the borrower may default in the payment of contractual interest or principal on its debt obligations, or both. The entity continuously monitors defaults of customers and other counterparties and incorporates this information into its credit risk controls.

Financial instruments

Risk concentration is minimized by investing in highly rated, investment grade bonds and debt instruments, which has the least risk of default. The Company lends to borrowers with a good credit score and generally most of the lending is secured against assets pledged by the borrower in favour of the Company. These investments and loans are reviewed by the Board of Directors on a regular basis.

(b) Market risk:

Market risk is a form of systematic risk associated with the day-to-day fluctuation in the market prices ofshares and securities and such market risk affects all securities and investors in the same manner. These daily price fluctuations follows its own broad trends and cycles and are more news and transaction driven rather than fundamentals and many a times, it may affect the returns from an investment. Market risks majorly comprises of two types - interest rate risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risks include borrowings and investments.

(i) Price risk

Price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price. It arises from financial assets such as investments in equity instruments, bonds, mutual funds etc. The Company is exposed to price risk arising mainly from investments carried at fair value through FVTPL or FVTOCI which are valued using quoted prices in active markets (level 1 investments). A sensitivity analysis demonstrating the impact of change in market prices of these instruments from the prices existing as at the reporting date is given below:

(ii) Interest rate risk

Interest rate risk is a type of systematic risk that particularly affects fixed rate debt instruments like bonds and debentures. The value of the fixed-rate debt instruments generally decline due to rise in interest rates and vice versa. The rationale is that a bond is a promise of a future stream of payments; an investor will offer less for a bond that pays-out at a rate lower than the rates offered in the current market. A rising interest rate scenario also affects the Company''s interest expenditure on borrowed funds

The Company monitors the interest rate scenarios on a regular basis and accordingly takes investments decisions.Further, the Company''s borrowings are short-term in nature and carry a fixed rate of interest and the company is in a position to pass on the rise in interest rates to its borrowers. However, the borrowings of the Company are not significant to the financial statements.

(c) Liquidity risk:

Liquidity refers to the readiness of the Company to sell and realise its financial assets. Liquidity risk is one of the most critical risk factors for Companies which is into the business of investments in shares and securities. It is the risk of not being able to realise the true price of a financial asset, or is not being able to sell the financial asset at all because of non-availability of buyers. Unwillingness to lend or restricted lending by Banks and Financial Institutions may also lead to liquidity concerns for the entities.

The Company maintains a well-diversified portfolio of investments in shares and securities which are saleable at any given point of time. A dedicated team of market experts are monitoring the markets on a continuous basis, which advises the management for timely purchase or sale of securities. The Company is currently having a mix of both short-term and long-term investments. The management ensures to manage it''s cash flows and asset liability patterns to ensure that the financial obligations are satisfied in timely manner.

For disclosures pursuant to master direction - RBI (NBFC scale based regulation) Direction 2023, Annex VI dated 19th October 2023 that enables the market participants to make an informed judgment about the soundness of its liquidity risk management framework and liquidity position, refer note no 37.

33 Capital management

For the purpose of Company''s capital management, capital includes issued equity share capital, other equity reserves and borrowed capital less cash and cash equivalents. The primary objective of capital management is to maintain an efficient capital structure to reduce the cost of capital, support corporate expansion strategies and to maximize shareholder''s value.

The entity manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the entity may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The entity monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The entity''s policy is to keep an optimum gearing ratio. The entity includes within net debt, interest bearing loans and borrowings less cash and cash equivalents.

3 Derivatives

The Company does not have any derivatives open exposure in the current and previous years.

4 Asset liability management

Disclosures relating to maturity pattern of certain items of assets and liabilities are given in note 37.

5 Exposures

A) Exposure to real estate sector Category

a) Direct exposure

i) Residential mortgages- _{- -}

Lending fully secured by mortgages on residential property that is or will be occupied by the borrower or that is rented

ii) Commercial real estate - -

Lending secured by mortgages on commercial real estates (office buildings, retail space, multi-purpose commercial premises, multi-family residential buildings, multi-tenanted commercial premises, industrial or warehouse space, hotels, land acquisition, development and construction, etc.). Exposure would also include non-fund based limits

iii) Investments in Mortgage Backed Securities (MBS) and other securitized exposures -

a) Residential - -

b) Commercial real estate _{- -}

b) Indirect exposure

Fund based and non-fund-based exposures on National Housing Bank and _{- -}

Housing Finance Companies.

B) Exposure to capital market

i) direct investment in equity shares, convertible bonds, convertible debentures and units of equity-oriented mutual funds the corpus of which is not exclusively invested in corporate debt;

ii) advances against shares / bonds / debentures or other securities or on clean basis to individuals for investment in shares (including IPOs / ESOPs), convertible bonds, convertible debentures, and units of equity-oriented mutual funds;

iii) advances for any other purposes where shares or convertible bonds or convertible debentures or units of equity oriented mutual funds are taken as primary security;

iv) advances for any other purposes to the extent secured by the collateral security of shares or convertible bonds or convertible debentures or units of equity oriented mutual funds i.e. where the primary security other than shares / convertible bonds / convertible debentures / units of equity oriented mutual funds does not fully cover the advances;

v) secured and unsecured advances to stockbrokers and guarantees issued on behalf of stockbrokers and market makers;

vi) loans sanctioned to corporates against the security of shares / bonds / debentures or other securities or on clean basis for meeting promoter''s contribution to the equity of new companies in anticipation of raising resources;

vii) bridge loans to companies against expected equity flows / issues;

viii) underwriting commitments taken up by the NBFCs in respect of primary issue of shares or convertible bonds or convertible debentures or units of equity oriented mutual funds

D) Details of Single Borrower Limit (SBL)/Group Borrower Limit (GBL) exceeded by the NBFC

There are no instances of exceeding the single and group borrowing limit by the Company during the current and previous year.

E) Unsecured Advances

The Company does not have any unsecured advances for which intangible securities such as charge over rights, license, authority, etc. has been taken.

6 Miscellaneous

A) Registration obtained from other financial sector regulators

The Company does not have any registrations obtained from other financial sector regulators.

B) Disclosure of Penalties imposed by RBI and other regulators

Note:

(a) Amounts for the current year and comparative years included above are based on the restated financial statements prepared under Ind AS.

9 Corporate Governance (refer Corporate Governance section in the annual

10 Breach of covenant

During the year ended March 31, 2025 and March 31, 2024 there is no breach of covenant.

Divergence in asset classification and provisioning

11

During the year ended March 31, 2025 and March 31, 2024 no divergence in asset classification and provisioning has been reported.

Note 35: Disclosures given pursuant to Annexure VII of the Master Direction - Reserve Bank of India (Non-Banking Financial Company -Scale Based Regulation) Directions, 2023

(i) Sectoral exposure: Reger Note 4

(ii) Intra-group exposures:Nil

(iii) Unhedged foreign currency exposure : The Company do not have any Unhedged foreign currency exposure in Current year & previous year.

(iv) Related Party Disclosures : Details of all related party disclosures are given in note 27

(v) Disclosure of Complaints : a) No Complaints has been received during the Current year & previous year.

b) Top five grounds of complaints received by the NBFCs from customers- Not Applicable

(vi) Miscellaneous - Additional disclosures pursuant to the RBI circular RBI/2021-22/112 DOR.CRE.REC.No.60/ 03.10.001/2021-22 dated October 22, 2021

a) Disclosures relating to Corporate Governance Report containing composition and category of directors, shareholding of non-executive directors, etc: - Details relating to Corporate Governance Report containing composition and category of directors, shareholding of nonexecutive directors etc are covered under Corporate Governance Report, which forms part of the Annual Report.

b) Disclosure on modified opinion, if any, expressed by auditors, its impact on various financial items and views of management on audit qualifications: - The Auditors has not expressed any modified opinion during the current financial year ended 31 March 2025.

c) Disclosures relating to items of income and expenditure of exceptional nature - During the financial year 2024-2025, the company sold its entire 100% stake in a wholly owned subsidiary to another company. This transaction is classified as exceptional in nature due to its onetime and significant impact on the financial results.

d) Disclosures relating to breaches in terms of covenants in respect of loans availed by the Company or debt securities issued by the Company including incidence/s of default -There are no such instance during the Financial Year 2024-2025.

e) Disclosures relating to Divergence in asset classification and provisioning above a certain threshold to be decided by the Reserve Bank: -There are no such instance during the Financial Year 2024-2025.

(vii) Institutional set-up for Liquidity Risk Management

The Board of Directors of the Company has an overall responsibility and oversight for the management of all the risks, including liquidity risk, to which the Company is exposed to in the course of conducting its business. The Board approves the governance structure, policies, strategy and the risk limits for the management of liquidity risk. The Board of Directors approves the constitution of the Risk Management Committee (RMC) for the effective supervision, evaluation, monitoring and review of various aspects and types of risks, including liquidity risk, faced by the Company. The meetings of RMC are held at quarterly interval. Further, the Board of Directors also approves constitution of Asset Liability Committee (ALCO), which functions as the strategic decision-making body for the asset-liability management of the Company from risk-return perspective and within the risk appetite and guard-rails approved by the Board. The main objective of ALCO is to assist the Board and RMC in effective discharge of the responsibilities of asset liability management, market risk management, liquidity and interest rate risk management and also to ensure adherence to risk tolerance/limits set up by the Board. ALCO provides guidance and directions in terms of interest rate, liquidity, funding sources, and investment of surplus funds. ALCO meetings are held once in a Quarterly or more frequently as warranted from time to time. The

Note 36 (i): Disclosures pursuant to Reserve Bank of India notification no. DOR (NBFC).CC.PD.No.109/22.10.106/2019-20 dated 13 March 2020 on implementation of IndAS by Non-Banking Financial Companies : Nil

38 Additional Regulatory Information (to the extent applicable and reportable) :

(i) The Company has complied with the number of layers prescribed under clause (87) of Section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017. - NA

39 Based on the information available with the Company and has been relied upon by the auditors, none of the suppliers have confirmed to be registered under "The Micro, Small and Medium Enterprises Development (''MSMED'') Act, 2006". Accordingly, no disclosure relating to principal amounts unpaid as at the period ended 31st March, 2024 together with interest paid/payable are required to be

40 No significant adjusting event occurred between balance sheet date and the date of the approval of these standalone financial statements by the Board of Directors requiring adjustments on disclosures.

41 Segment reporting

As per the requirement of Ind AS 108, Operating Segments, based on evaluation of financial information for allocation of resources and assessing performance, the Group identified as single segments, i.e., holding and investing with focus on earning income through dividends, interest and gains from investments and operates in India. Accordingly, there are no separate reportable segments as per the Standard.

42 Enhancing Accountability and Transparency: Implementation of Audit Trail

The company had implemented an audit trail system within our company''s software which has impact on books of accounts with

effect from 1st April 2023. This implementation underscores our commitment to transparency, accountability, and data integrity. Audit trail has been implemented for all transactions recorded in the software throughout the year. By capturing and documenting critical events and activities within our systems, we ensure a comprehensive

record that enhances security, facilitates compliance, and supports effective decision-making. In addition, audit trail data is preserved in the system as per statutory requirement for record retention. The company''s dedication to maintain a robust audit trail reflects ongoing efforts to uphold the highest standards of governance and security across all aspects of business operations.

43 Backup Schedule and Data Preservation

The company follows a well-defined backup schedule and data preservation protocol to ensure the integrity and availability of critical information assets. Regular and systematic backups are conducted to protect against potential data loss or corruption. This proactive approach ensures that vital data remains secure and accessible in the event of unforeseen incidents.

44 Other Regulatory Information :

(i) 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) The Company does not have any transactions with struck off Companies.

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

(iv) The Company has not advanced or given 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.

(v) The Company has 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 on behalf of the Ultimate Beneficiaries.

(vi) The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the 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) The Company has not been declared as wilful defaulter by any bank or financial institution or other lender.

(viii) There are no charges or satisfaction yet to be registered with ROC beyond the statutory period.

44 Amount shown as K 0.00 represents amount below K 500 (Rupees Five Hundred).

45 Figures or the previous year have been regrouped wherever necessary.

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Mar 31, 2024

Provisions

Provisions are recognised when, as a result of a past event, the Company has a legal or constructive
obligation; it is probable that an outflow of resources will be required to settle the obligation; and the
amount can be reliably estimated. The amount so recognised is a best estimate of the consideration required
to settle the obligation at the reporting date, taking into account the risks and uncertainties surrounding the
obligation. In an event when the time value of money is material, the provision is carried at the present
value of the cash flows estimated to settle the obligation.

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.

The company measures the expected credit loss associated with its assets based on historical trend, industry
practices and the business environment in which the entity operates or any other appropriate basis. The
impairment methodology applied depends on whether there has been a significant increase in credit risk.

Loans & Borrowings

This is the category most relevant to the Company. After initial recognition, interest-bearing loans and
borrowings are subsequently measured at amortised cost using the EIR method.

Amortised 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 amortisation is included as finance costs in the statement
of profit and loss.

Cash and Cash equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits
with an original maturity of three months or less, which are subject to an insignificant risk of changes in
value.

Contingent Liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed
by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the
company or a present obligation that is not recognized because it is not probable that an outflow of
resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases
where there is a liability that cannot be recognized because it cannot be measured reliably. The Company
does not recognize a contingent liability but discloses its existence in the financial statements.

Notes to the Financial Statements

18. In the opinion of the Board the current assets, loans and advances are not less than the stated value if realised in
ordinary course of business. The provisions for all known liabilities are adequate. There are no contingent
liabilities, as informed by the management.

19. The Business of the company falls under a single segment i.e. Financial Activities. In view of the general
classification notified by Central Government in exercise of powers conferred u/s 129 of Companies Act, 2013
for companies operating in single segment, the disclosure requirement as per Ind AS - 108 on “Segment
Reporting” are not applicable to the company. The company’s business is mainly concentrated in similar
geographical, political and economical conditions; hence disclosure for geographical segment is also not
required.

22. None of the sundry creditors are Micro and Small Enterprises under “Micro, Small and Medium Enterprises
Development Act, 2006”. Hence, disclosures related to amount unpaid etc., are not applicable.

23. There is no amount to be credited to Investors Education and Protection Fund as on 31^st March 2024.

24. The figures of previous year have been reclassified and regrouped wherever considered necessary.

Additional Regulatory Information :

25. No proceedings have been initiated or pending against the company for holding any benami property under the Benami Transactions
(Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.

26. The company has not borrowed any money from banks or financial institutions on the basis of security of current assets during the reporting
financial year.

27. The Company is not declared wilful defaulter by the bank or financial Institution or other lender.

For BISWAS DASGUPTA DATTA AND ROY For Hi-Klass Trading And Investments Limited

Chartered Accountants
Registration No : 302105E

Sanjay Kumar Jain Sonu Agarwal

Managing Director Director

(FCA Kakoli De Sarkar) DIN : 00415316 DIN : 09065415

Partner

Membership no : 302910 For Hi-Klass Trading And Investments Limited

UDIN: 24302910BKDTRW2866

Date : 28th May 2024 Pravin K Chopda Neha Kedia

Place : Mumbai CFO Company Secretary

PAN : AABPC1906< PAN : CFMPK6996Q