Notes to Accounts of Holmarc Opto-Mechatronics Ltd.

Mar 31, 2025

B.13 Provisions

A provision is recognised when an enterprise has a present obligation as a result of past event; it is probable that an outflow
of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not
discounted to its present value and are determined based on best estimate required to settle the obligation at the balance
sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

B.14 Cash flow statement

Cash flows are reported using the indirect method, whereby profit/(loss) before extraordinary items and tax is adjusted for
the effects of transactions of non-cash nature and any deferrals or accruals of past or future receipts or payments. In the cash
flow statement, cash and cash equivalents consist of cash in hand, cheques on hand, balances with banks in current accounts
and demand deposits .

B.15 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 recognised 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 recognised
because it cannot be measured reliably. A disclosure is made for a contingent liability when there is a:

a) possible obligation, the existence of which will be confirmed by the occurrence/non-occurrence of one or more uncertain
events, not fully with in the control of the Company;

b) present obligation, where it is not probable that an outflow of resources embodying economic benefits will be required to
settle the obligation;

c) present obligation, where a reliable estimate cannot be made.

B.16 Borrowing costs

Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset are capitalised as
part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur .

Note: Contingent liabilities

a. The Company has not deposited an amount of Rs.17,75,790 towards building tax claimed by the Kalamassery Municipality on account of
dispute. The appeal filed by the Kalamassery Municipality is presently pending before the Honourable High Court of Kerala.

b. The Company has issued Performance Bank Guarantee to its customer worth Rs.72,92,790 for the satisfactory performance of their
products supplied.

31 Retirement benefits
Employee benefit plans

Gratuity

The Company has a defined benefit gratuity plan. Gratuity is computed as 15 days salary, for every completed year of service or part thereof
in excess of 6 months and is payable on retirement/termination/resignation. The benefit vests on the employees after completion of 5 years
of service. The Gratuity liability has been externally funded with Life Insurance Corporation. The present value obligation is determined
based on actuarial valuation using Projected Unit Credit Method.

The following tables summarise the components of net benefit expense recognized in the statement of profit and loss and the funded status
and amounts recognized in the balance sheet for gratuity.

The estimates of future salary increases, considered in actuarial valuation, take in to account of inflation, seniority, promotion and other
relevant factors, such as supply and demand in the employment market.

32 Obligations towards non cancellable operating leases

The company has not entered into any non cancellable operating lease during the year. The Company has taken godowns, office premises
and guest houses on cancellable operating leases. There are no restrictions imposed by the leasing arrangements.

33 Cash Flow

The Cash Flow Statement has been prepared under the "Indirect Method" as set out in Accounting Standard -3 ''Cash Flow Statement''.
Previous year''s figures have been regrouped / rearranged / recasted wherever necessary to make them comparable with those of current year

iv 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, and there are no companies beyond the specified layers.

37 Utilisation of Borrowed funds

A. The Company has not advanced or loaned or invested funds (either borrowed funds or any other sources or kind of funds) to
any other person(s) or entity(ies), including foreign entities (“Intermediaries”) with the understanding (whether recorded in
writing or otherwise) that the Intermediary shall:

(i) 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

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

B. 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:

(i) 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

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

38 Undisclosed Income

The Company does not have any transaction 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). Further, there was no previously unrecorded income and no additional assets were
required to be recorded in the books of account during the year.

39 Details of Crypto Currency or Virtual Currency

The Company has neither traded nor invested in Crypto currency or Virtual Currency during the financial year ended March 31,
2025. Further, the Company has also not received any deposits or advances from any person for the purpose of trading or
investing in Crypto Currency or Virtual Currency.

40 Previous year figures have been regrouped / reclassified wherever necessary to suit current year layout.

As per our audit report of even date

For, G Joseph & Associates For and Behalf of Board of Directors

Chartered Accountants HOLMARC OPTO MECHATRONICS LIMITED

Firm Reg. No: - 006310S

sd/-

Allen Joseph JOLLY CYRIAC Sd/-

Partner ^MANAGING m^RE^CT°^R I shACH SAINUDDIN

^DIN: 00409364 WHOLE TIME DIRECTOR AND CFO

M N_o. 228498 DIN: 00409402

sd/- sd/-

g unnikrishna kurup parvathy v

Place: - Kochi WHOLE-TIME DIRECTOR COMPANY SECRETARY &

_{Date :- 26}/₀5/₂₀₂5 DIN: 07622598 COMPLIANCE OFFICER

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Mar 31, 2024

1. The Company has only one class of equity shares of par value Rs 10/- each. Each equity shareholder is entitled to one vote per share held, and on liquidation entitled to receive balance of net assets remaining after settlement of all debts, creditors & preferential amounts, proportionate to their respective shareholding.

2. The company has issued 28,50,000 equity shares of face value Rs.10/- for cash at an issue price Rs.40/-per share on September 22, 2023 as Initial Public Offering on the National stock exchange.The equity shares allotted shall, rank pari-passu with the existing equity shares of the company and shall be entitled to dividend and corporate benefits,if any declared by company after allotment

I Canara Bank Limited

a The Company has availed Canara Bank - Loan in account No.170002829489 which is repayable in 60 monthly installement of Rs. 2,57,563 each till 15-Dec-2026, current rate of interest for the loan is 9.7%, this loan is secured by Plant and machinery.The company closed the loan on 21-Nov-2023.

b The Company has availed Canara Bank - Loan / GECL in A/c No.170002369836 which is repayable in 60 monthly installments of Rs. 41,667 each till 25-Nov-2026 , current rate of interest for the loan is 7.5%.This loan is primarly secured by Stock and Book debts.The company closed the loan on 05-April-2023.

c The Company has availed Canara Bank Loan in A/c No. 2339755000057 which is repayable in 60 monthly installments of Rs. 47,538 each till 4-Aug-2026 , current rate of interest for the loan is 7.5% . This loan is secured by stock and book debts.The company closed the loan on 05- April-2023.

II Vehicle loan from Kotak Mahindra Prime Ltd

a The Company has availed Vehicle Loan which is repayable in roughly 60 installments of Rs. 30,989 , each till 5 April 2024 , current rate of interest for the loan is 8.16% ,this loan is secured by the way of hypothication of vehicle.The company closed the loan on 30-sept-2023.

b The Company has availed a vehicle loan which is repayable in roughly 60 installements of Rs. 42,711 , each till 1 Feb 2026 , current rate of interest for the loan is 6.25% ,this loan is secured by the way of hypothication of vehicle.The company closed the loan on 30-sept-2023

Note : The Company was previously valuing its liability for gratuity based on a statement provided by Life Insurance Corporation, the Company’s gratuity fund manager. However, in FY 2022-23, the Company decided to approach an external actuarial valuer for the purpose of obtaining an actuarial valuation in compliance with the provisions of Accounting Standards - 15 on Employee Benefits issued by the Institute of Chartered Accountants of India. Accordingly, gratuity expense for FY 2022-23 and thereafter has been determined in accordance with the actuarial valuation and the balance amount to arrive at the net liability as at March 31, 2023 has been shown as prior period income.

Note: Contingent liabilities

a The Company has not deposited an amount of Rs.17,75,790 towards building tax claimed by the

Kalamassery Municipality on account of dispute. The appeal filed by the Kalamassery Municipality is presently pending before the Honourable High Court of Kerala. b The Company has issued Performance Bank Guarantee to its customer worth Rs. 62,50,214 for the satisfactory performance of their products supplied.

33 Retirement benefits

Employee benefit plans

Gratuity

The Company has a defined benefit gratuity plan. Gratuity is computed as 15 days salary, for every completed year of service or part thereof in excess of 6 months and is payable on retirement/ termination/resignation. The benefit vests on the employees after completion of 5 years of service.

The Gratuity liability has been externally funded with Life Insurance Corporation. The present value

obligation is determined based on

actuarial valuation using Projected Unit Credit Method.

The following tables summarise the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for gratuity.

The estimates of future salary increases, considered in actuarial valuation, take in to account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

³⁴ Obligations towards non cancellable operating leases

The company has not entered into any non cancellable operating lease during the year. The Company has taken godowns, office premises and guest houses on cancellable operating leases. There are no restrictions imposed by the leasing arrangements.

³⁵ Cash Flow

The Cash Flow Statement has been prepared under the “Indirect Method” as set out in Accounting Standard -3 ‘Cash Flow Statement’. Previous year’s figures have been regrouped / rearranged / recasted wherever necessary to make them comparable with those of current year

36 Statement of Related Parties & Transactions

The company has entered into following related party transactions for the periods covered under audit. Such parties and transactions are identified as per Accounting Standard 18 issued by Institute of Chartered Accountants of India.

38 Additional Regulatory Information

i There are no proceedings that have been initiated or pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 (as amended from time to time) (earlier Benami Transactions (Prohibition) Act, 1988) and the rules made thereunder.

ii The Company has not been declared wilful defaulter by any bank or financial institution or other lender.

iii Relationship with Struck off Companies

iv 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, and there are no companies beyond the specified layers

39 Utilisation of Borrowed funds

A The Company has not advanced or loaned or invested funds (either borrowed funds or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (“Intermediaries”) with the understanding (whether recorded in writing or otherwise) that the Intermediary shall:

i 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

ii provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

B 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 :

(i) 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

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries

40 Undisclosed Income

The Company does not have any transaction 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). Further, there was no previously unrecorded income and no additional assets were required to be recorded in the books of account during the year.

41 Details of Crypto Currency or Virtual Currency

The Company has neither traded nor invested in Crypto currency or Virtual Currency during the financial year ended March 31, 2024. Further, the Company has also not received any deposits or advances from any person for the purpose of trading or investing in Crypto Currency or Virtual Currency.

42 Previous year figures have been regrouped / reclassified wherever necessary to suit current

year layout.

---

Mar 31, 2023

a) The Company has availed Canara Bank - Loan in account No 170002829489which is repayable in 60 monthly installemcm of Rs. 2,57,563 each till l5-Dcc-2026, current rate of interest for the loan is 9 7%, this loan is secured by Plant and machinery.

b) The Company has availed Canara Bank - Loan / GECL in A/c No 170002369836 which is repayable in 60 monthly installments of Rs 41,667 each till 25-Nov-2026 . current rate of interest for the loan is 7 5% This loan is primarly secured by Stock and Book debts

c) The Company has availed C anara Bank Loan in A/c No 2339755000057 which is repayable in 60 monthly insiallcments of Rs 47,538 each till 4-Aug-2026 , current rate of interest for the loan is 7.5% . This loan is secured by stock and book debts.

II. Vehicle loan from Kotak Mahindia Prime Ltd

a) The Company has availed Vehicle Loan which is repayable in roughly 60 installments of Rs 30,989 . each till 5 April 2024 . current rate of interest for the loan is 8.16% .this loan is secured by the way of hypotliication of vehicle,

b) The Company has availed a vehicle loan which is repayable in roughly 60 installments of Rs 42,711 , each till I Feb 2026 current rate of interest for ihe loan is 6.25% .this loan is secured by the way of hypotliication of vehicle

a) Overdraft facility from Canara Bank Limited

Overdraft lacility sanctioned to tile tune of Ks. 150.00.000 from ( anara Bank is secured by way of charge on tire slock and book debts of the company This facility carries an interest rate of RLLR 6 90% 2 40%

b) Credit card facility from Canara Bank l imited

Credit facility sanctioned to the tunc of Rs 2.00.000 front Canara Bank is secured by way of charge on the stock and book debts of the company This facility carries an interest rate of I-MCLR-6M-»-l % i.e presently 8.25% per annum.

The Company was previously valuing its liability for gratuity based on a statement provided by Tile Insurance Corporation, the Company s gratuity lund manager However, in FY 2022-23. the Company decided to approach an external actuarial valuer for the purpose of obtaining an actuarial valuation in compliance with the provisions of Accounting Standards - 15 on Employee Benefits issued by the Institute of Chartered Accountants of India Accordingly, gratuity expense for the year has been determined in accordance with the actuarial valuation and the balance amount to arrive at the net liability as at March 31.2023 has been shown as prior-period income

a. The Company has not deposited an amount of Rs. 17,75.790 towards building tax claimed by the Kalantassery Municipality on account: of dispute The appeal hied by the Kalamassei v Municipality is presently pending before the Honourable High Court of Kerala.

b The Company has issued Performance Bank Guarantee to its customer worth Rs 29.83 Lakhs for the satisfactory performance of their products supplied

33 Retirement benefits Employee benefit plans

Gratuity

^ he Company has a defined benefit gratuity plan, Gratuity is computed as 15 days salary, for every completed year of service or part thereof in excess of 6 months and is payable on retiiemeni''termtnation/resignation The benefit vests on the employees after completion of 5 years of service The Gratuity liability has been externally landed with Life Insurance Corporation I lie present value obligation is determined based on actuarial valuation using Projected Unit Credit Method

The following tables summarise the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for gratuity

The estimates of future salary increases, considered in actuarial valuation, take in to account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market

34 Obligations towards non cancellable operating leases

The company has not entered into any non cancellable operating lease during the year The Company has taken godowns, office premises and guest houses on cancellable operating leases There arc no restrictions imposed by the leasing arrangements

35 Cash Flow

The Cash Flow Statement has been prepared under the "Indirect Method" as set out in Accounting Standard -3 ''Cash Flow Statement’ Previous year''s figures have been regrouped / rearranged / recastcd wherever necessary to make them comparable with those of current year

36 Estimation of uncertainties relating to the global health pandemic from COVID-19 ( ( OVID-19):

The Company has considered the possible effects that may result from the pandemic relating to COVID-19 on the carrying amounts of receivables, unbilled revenues and intangible assets In developing the assumptions relating to the possible future uncertainties in the global economic conditions because of this pandemic, the Company, as at the date of approval of these financial statements has used internal and external sources of information including credit reports and related information, economic forecasts and consensus estimates from market sources on the expected future performance of the Company. Based on current estimates the Company expects that the carrying amount of these assets will be recovered The impact of COVID-19 on the Company’s financial statements may differ from that estimated as at the date ot approval of these standalone financial statements.

IV 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. and there are no companies beyond the specified layers

40 Utilisation of Borrowed funds

A The Company has not advanced or loaned or invested funds (either borrowed funds or any other sources or kind of funds) to any other person(s) or entuy(ies), including foreign entities ("Intermediaries”) with the understanding (whether recorded in writing or otherwise) that the Intermediary shall

(i) directly or indirectly lend or invest in other persons or entitles identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”), or

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

B The Company has not received any fund from any person(s) or entity(ics), including foreign entities (“Funding Party”) with the understanding (whether recorded in writing or otherwise) that the Company shall

(t) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of ihe Funding Party ("Ultimate Beneficiaries”); or

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries

41 Undisclosed Income

The Company does nol have any transaction nol 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) Further, there was no previously unrecorded income and no additional assets were required to be recorded in the books of account during the year,

42 Details of Crypto Currency or Virtual Currency

The Company has neither traded nor invested in Crypto currency or Virtual Currency during the financial year ended March 31,2023, Further, the Company has also not received any deposits or advances from any person for the purpose of trading or investing in Crypto Currency or Virtual Currency

43 Previous year figures have been regrouped / reclassified wherever necessary to suit current year layout