Notes to Accounts of International Gemological Institute Ltd.

Mar 31, 2026

4.18 Provisions and contingencies

Provisions: A provision is recognised when the
Company has a present obligation as a result of past
events and 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.

The amount recognised as a provision is the best
estimate of the consideration required to settle the
present obligation at the end of the reporting period,

taking into account the risks and uncertainties
surrounding the obligation. When a provision is
measured using the cash flows estimated to settle the
present obligation, its carrying amount is the present
value of those cash flows (when the effect of time value
of money is material).

Contingent Liability: A contingent liability is

(a) a possible obligation arising from past events
and whose existence will be confirmed only by
the occurrence or non-occurrence of one or more
uncertain future events not wholly within the
control of the entity or

(b) a present obligation that arises from past events
but is not recognised because;

- ¹ it is not probable that an outflow of
resources embodying economic benefits will
be required to settle the obligation or

- the amount of the obligation cannot be
measured with sufficient reliability.

The Company does not recognise a contingent
liability but discloses the same as per the
requirements of Ind AS 37.

4.19 Earnings Per Share

Basic earnings per share are calculated by dividing
the profit or loss for the period attributable to equity
shareholders by the weightedaverage number
of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per
share, the profit or loss for the period attributable to
equity shareholders and the weighted average number
of shares outstanding during the period are adjusted
for the effects of all dilutive potential equity shares."''

4.20 Segment reporting

The operating segments have been identified based on
the conditions specified in paragraph 5 to Ind AS 108, i.e.
an operating segment is a component of the Company
that engages in business activities from which it may
earn revenues and incur expenses, whose operating
results are regularly reviewed by the Company''s Chief
Operating Decision Maker ("CODM") to make decisions
for which discrete financial information is available that
is evaluated regularly by the CODM, in deciding how to
allocate resources and assessing performance.

4.21 Events after the reporting period

If the Company receives information after the reporting
period, but prior to the date when the financial
statements are approved for issue, about conditions that

existed at the end of the reporting period, it will assess
whether the information affects the amounts that it
recognises in its consolidated financial statements.
The Company will adjust the amounts recognised
in its standalone financial statements to reflect any
adjusting events after the reporting period and update
the disclosures that relate to those conditions in light
of the new information. For non-adjusting events after
the reporting period, the Company will not change
the amounts recognised in its standalone financial
statements, but will disclose the nature of the non
adjusting event and an estimate of its financial effect,
or a statement that such an estimate cannot be made,
if applicable.

5 RECENT ACCOUNTING PRONOUNCEMENTS

The Ministry of corporate Affairs (""MCA"") notified
amendments on 7 May 2025 and 13 August 2025
under the Companies (Indian Accounting Standards)
Amendment Rules, 2025 and the Companies (Indian
Accounting Standards) Second Amendment Rules,
2025, respectively, which is effective from annual
reporting periods beginning on or after 1 April 2025.

(i) Amendment to Ind AS 7 and Ind AS 107 - Supplier
Finance Arrangement:

The amendments to Ind AS 7 ''Statement of Cash
Flows'' and Ind AS 107 ''Financial Instruments:

Disclosures'' clarify the characteristics of supplier
finance arrangements and require additional
disclosures for such arrangements. The
disclosure requirements in the amendments are
intended to assist users of financial statements
in understanding the effects of supplier finance
arrangements on an entity''s liabilities, cash flows
and exposure to liquidity risk.

The Company does not have any supplier finance
arrangements during the reporting period.

(ii) Amendment to Ind AS 1 - Classification of
liabilities as current or non-current and non¬
current liabilities with covenants:

The amendment specifies the requirements for
classifying liabilities as current or non-current in
the balance sheet, and clarifies the following:

a) An entity''s right to defer settlement of a
liability for at least twelve months after the
reporting period must have substance and
must exist at the end of the reporting period.
The classification of a liability as current or
non-current is unaffected by the likelihood

that the entity will exercise its right to defer
settlement.

b) If an entity''s right to defer settlement of
a liability is subject to covenants, such
covenants affect whether that right exists
at the end of the reporting period only if the
entity is required to comply with the covenant
on or before the end of the reporting period.

c) In case of a liability that can be settled, at the
option of the counterparty, by the transfer
of the entity''s own equity instruments,
such settlement terms do not affect the
classification of the liability as current or
non-current only if the option is classified as
an equity instrument.

These amendments have no effect on
the measurement of any items in the
consolidated financial statements of the
Company. The Company did not make
retrospective adjustments as a result of
adopting the amendments to Ind AS 1.

(iii) Amendment to Ind AS 12 - Pillar-Two Tax Reforms

The Company is not within the scope of the OECD
Pillar Two Model Rules, as Pillar Two legislation
has not yet been enacted in any of the jurisdiction
in which the Company operates.

(iv) Amendment to Ind AS 21-Lack of exchangeability

The Amendments introduces requirement
to assess when a currency is exchangeable
into another currency and when it is not. The
amendment requires an entity to estimate the spot
exchange rate when it concludes that a currency
is not exchangeable into another currency. These

amendments had no effect on the consolidated
financial statements of the Company.

The below amendments are notified but not yet
effective

Amendment to Ind AS 1 ''Presentation of Financial
Statements''- Classification of Liabilities as current
or non-current and non-current liabilities with
covenants:

The amendment includes specific provisions that
will take effect for reporting periods beginning on
or after 1 April 2026, retrospectively, as outlined
below:

i) Breach of material covenant for long¬
term loan arrangement on or before end
of reporting period with effect that liability
becomes payable on demand as on reporting
date, then it shall be classified as current
liability, if lender agreed after reporting period
and before approval of financial statements
to not demand payment as a consequence
of breach.

ii) Classify as non-current liability, if lender
agreed by end of reporting period to provide
grace period ending at least 12 months after
reporting period within which entity can
rectify the breach provided lender does not
demand immediate repayment.

iii) Disclose information about the timing of
settlement to understand the impact of the
liability on the financial statements.

The Company does not expect this amendment to
have an impact on its operations or consolidated
financial statements.

The recoverable amount is based on a value-in-use calculation using the discounted cash flow method. The value-in-use
calculation is made using cashflow projections for reasonable period which is considered by the Board. Key assumptions
for the value in use computations are those regarding the discount rates, market demand, revenue, EBITDA margins etc. The
projections are based on both past performance and the expectations of future performance and assumptions therein. The
Company estimates discount rates using post-tax rates that reflect the current market rate adjusted for specific company risk.
The weighted average post-tax discount rates used for discounting the cash flows projections is 14% and average revenue
growth considered is 15.81%, which is aligned to the average growth rate for the industry

The Company has conducted sensitivity analysis over key assumptions viz. revenue growth rates and discount rate used.
While it is unlikely for assumptions to move adversely together, it would require over an 18% change in revenue growth or a 18%
change in discount rate, for the recoverable amount of the investments to be equal to its carrying amount. These sensitivities
are carried in isolation and also do not take account of potential mitigating actions.

*Refer note 43

The Company has provided loan to its wholly owned subsidiary to carry out business operations. The movement in the
loan balance is on account of currency exchange fluctuation.

The Company has not entered with any Scheme(s) of arrangement in terms of sections 230 to 237 of the Companies Act, 2013.
No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources
or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries”) with
the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by
or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding
Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or
entities identified by or on behalf of the Company ("Ultimate Beneficiaries”) or provide any guarantee, security or the like
on behalf of the Ultimate Beneficiaries.

Notes:

15.1 Trade receivables from related parties (refer note 36 for details)

15.2 Trade receivables are non-interest bearing and are generally on credit terms of 0 to 60 days.

15.3 Movement in the allowance for expected credit losses of trade receivables is disclosed under Note 37.

15.4 There are no debts due by directors or other officers of the Company or any of them either severally or jointly with any
other person or debts due by firms or private companies respectively in which any director is a partner or director or a
member.

18.5 1. The Board of Directors passed a resolution at its meeting held on 25^th April, 2024 approving the sub-division of each
equity share of face value of Rs. 10 each fully paid up into face value of Rs. 2 each fully paid up.The members in its
Extra Ordinary General meeting dated 8^th May, 2024 have approved increase in the authorised share capital from Rs.
10 million divided into 5 million equity shares of Rs. 2 each (post split of shares) to Rs. 1,000 million divided into 500
million equity shares of Rs. 2 each. Further, the Board of Directors have also passed a resolution on 25^th April,2024
and approved the issue of bonus equity shares in its meeting which was further approved by shareholders in the
meeting held on 21^st May, 2024 in the ratio of 200 equity shares of Rs. 2 each for every 1 equity share of Rs. 2 each
by capitalisation of such sum standing to the credit of general reserves of the Company.

2. During the year ended 31^st December, 2024, the Nomination and Remuneration Committee in its meeting held on
18^th November, 2024 and 1^st December, 2024 had granted 20,951,824 options to the employees of the Company
under Employee Stock Option Plan 2024 ("ESOP 2024"). Further, the shareholders of the Company has also approved
to increase the authorised share capital from existing Rs. 1,000 million divided into 500 million equity shares Rs. 2
each to Rs. 1,100 million divided into 550 million equity shares of Rs. 2 each ranking pari passu in all respect with the
existing equity shares of the Company as per the Memorandum and Articles of Association of the Company.

Nature & Purpose of Reserves

Retained Earnings: Retained earnings are the profits that the Company has earned till date, less any transfers to general
reserves, dividends or other distributions paid to shareholders. It also includes re-measurement loss/gain on defined
benefit plans, net of taxes that will not be reclassified to statement of profit and loss.

General Reserve: General reserve is created from time to time by transferring profits from retained earnings and can be
utilised for purposes such as dividend payout, bonus issue, etc.

Share Premium: Share premium account comprises of premium on issue of shares. It is to be utilised in accordance with
the provisions of the the Companies Act, 2013.

34 EARNINGS PER SHARE

Basic EPS amount is calculated by dividing the profit/loss for the year attributable to ordinary equity holders by the weighted
average number of ordinary shares outstanding during the year.

Diluted EPS is calculated by dividing the profit/loss attributable to ordinary equity holders by the weighted average number
of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on
conversion of all the dilutive potential ordinary shares into ordinary shares.

The following table set forth the computation of basic earnings per share:

i) The Board of Directors at their meeting held on 25^th April, 2024 approved the sub-division of each equity share of face
value of Rs. 10 each fully paid up into face value of Rs. 2 each fully paid up.

ii) Further, the Board of Directors have also approved the issue of bonus equity shares in its meeting held on 21^st May, 2024
in the ratio of 200 equity shares of Rs. 2 each for every 1 equity share of Rs. 2 each by capitalisation of such sum standing
to the credit of free reserves of the Company.

iii) In line with the requirements of Ind AS 33, the basic and diluted earnings per share for the current and previous year
presented have been calculated after considering the share split and bonus issue.

35 EMPLOYEE BENEFITS(A) Defined contribution plans

The Company contributes to a defined contribution plan to Employee''s Provident Fund which are administered by the
Provident Fund authorities and has no further obligation beyond making its contribution which is expensed in the year to
which it pertains.

(B) Liabilities for compensated absences

The liabilities for compensated absences relate to the Company''s liabilities for earned leave which are classified as other
long-term employee benefits.

The liabilities for compensated absences not expected to be settled within the next 12 months amounts to Rs. 120.62
millions (31 December 2024: Rs. 100.89 millions)(Refer note 21).

Expense recognised in profit and loss for the year amounts to INR 23.46 millions (31 December 2024: Rs. 13.40 millions)
(Refer note no 29).

(C) Defined benefit plansI. Gratuity

The cost of providing defined benefits is determined using the projected unit credit method, with actuarial valuations being
carried out at each balance sheet date. Actuarial gains/losses are immediately recognised in the other comprehensive
income and are not deferred. The plan is a funded scheme.

The Gratuity scheme is a final salary Defined Benefit Plan that provides for a lump sum payment made on exit either
by way of retirement, death, disability or voluntary withdrawal. The benefits are defined on the basis of final salary
and the period of service and paid as lump sum at exit. The plan design means the risks commonly affecting the
liabilities and the financial results are expected to be:

1. Interest rate risk: A fall in the discount rate which is linked to the G.Sec. Rate will increase the present value of
the liability requiring higher provision.

2. Salary Risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries
of members. As such, an increase in the salary of the members more than assumed level will increase the plan''s
liability.

3. Asset Liability Matching Risk: The plan faces the ALM risk as to the matching cash flow. The entity has to
manage pay-out based on pay as you go basis from own funds.

4. Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only,
plan does not have any longevity risk.

37 FINANCIAL INSTRUMENTS RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company is exposed primarily to credit risk and liquidity risk. The management of the Company oversees the management
of these risks. The management is supported by a financial risk committee that advises on financial risks and the appropriate
financial risk governance framework for the Company. The financial risk committee provides assurance to the Companies
senior management that the Companies financial risk activities are governed by appropriate policies and procedures and that
financial risks are identified, measured and managed in accordance with the Companies policies and risk objectives. The Board
of Directors reviews and agrees policies for managing each of these risks which are summarised below.

(i) Interest rate risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in
market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to its bank
borrowings obtained with floating interest rates.

The Company is not exposed to the interest rate risk as there are no variable interest bearing borrowings/ investments.

(ii) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because
of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates
primarily to the Company''s operating activities (when revenue or expense is denominated in a different currency from the
Company''s functional currency).

(iii) 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. Credit risk arises principally from the Company''s trade receivables, security deposits, bank
balances and other financial assets. The objective of managing counterparty credit risk is to prevent losses in financial
assets. The Company assesses the credit quality of the counterparties, taking into account their financial position, past
experience and other factors.

Balances with banks as well as cash and cash equivalents are considered to have negligible risk or nil risk, as they are
maintained with high rated banks as approved by the Board of directors.

Other financial assets mainly includes security deposit given, term deposits, loan to related parties, interest accrued on
deposits, etc. Based on assessment carried by the Company, entire receivable under this category is classified as "Stage
1". There is no history of loss and credit risk and the amount of provision for expected credit losses on other financial
assets is negligible.

Trade receivables:

The Company applies the Ind AS 109 simplified approach for measuring expected credit losses which uses a lifetime
expected loss allowance (ECL) for trade receivables. The application of simplified approach does not require the Company
to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting
date, right from its initial recognition.

The Company uses past data and experience based on Company''s historical default rates to measure the ECL on trade
receivables. Based on evaluation carried out and to the best estimate of management, historical loss sufficiently covers
expected loss as well as future contingencies. Adjustment for forward looking factors are not considered significant,
hence no adjustment for forward looking factors is made.

(iv) Liquidity risk

Liquidity risk is the current and prospective risk arising out of an inability to meet financial commitments as they fall due,
through available cash flows or through the sale of assets at fair market value. Liquidity risk is the risk that the Company
will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring,
as far as possible, that it will always have sufficient liquidity to meet its liabilities when due.

The Company''s treasury department is responsible for liquidity, funding as well as settlement management. In addition,
processes and policies related to such risks are overseen by senior management. The management monitors the
Company''s net liquidity position through forecasts on the basis of expected cash flows.

(v) Fair value measurement hierarchy

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the
fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement
as a whole:

Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly
or indirectly observable

Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
unobservable

The fair value of cash and cash equivalents, trade receivables, trade payables, other financial liabilities and other financial
assets approximate their carrying amount largely due to short term nature of these instruments. The amortised cost using
effective interest rate (EIR) of non-current financial assets consisting of security deposits are not significantly different
from the carrying amount.

38 CAPITAL MANAGEMENT

The entity''s objectives when managing capital are to:

• safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and
benefits for other stakeholders, and

• Maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return
capital to shareholders, issue new shares or sell assets to reduce debt. Consistent with others in the industry, the Company
monitors capital on the basis of the following gearing ratio: Net debt (total borrowings net of cash and cash equivalents)
divided by Total ''equity'' (as shown in the statement of financial position). No changes were made in the objectives, policies
or processes for managing capital during the reporting periods. There are no Debts taken by the Company. Therefore, Capital
structure comprised of only equity as there are no external debts availed by company.

(a) Mr. Rohit Agarwal (ex-employee) had filed a case against the Company with the Labour Court. An order was passed by
Labour Court dated 11^th February, 2011 directing the Company to reinstate Mr. Agarwal as an employee and to pay back
wages to him to the extent of 25% along with continuity of service with effect from 9^th April, 2002. Against the order of
Labour court a writ petition was filed before the High court by the Company. By way of Order dated 10^th October, 2011,
the High Court granted a stay on the Labour Court''s orders on the condition that Company Deposit back the wages in
Court. An order dated 27^th January, 2012 recorded that Company has deposited Rs. 0.79 million i.e.100% back wages from
27^th February, 2009 to 31^st October, 2011, with the Prothonotary and Senior Master of the High Court. The Writ Petition has
been listed from time to time and is pending for final hearing.

(b) KS Trade LLC ("Complainant”) has filed a complaint dated 21^st December, 2017 ("Complaint”) against IGI International
Gemmological Institute Inc. (IGI USA), International Gemmological Institute DMCC (IGI UAE) along with the Company
(collectively, "IGI Entities”) and others (together with IGI Entities, "Defendants”), before the Supreme Court of the State
of New York. The Complainant has demanded USD 0.75 million and alleged inter alia that the Defendants conspired to
misrepresent the true value of diamonds by intentionally over-grading diamonds in IGI Entities'' affiliated laboratories
outside of New York, thereby allowing diamond dealers and wholesalers to re-sell diamonds at artificially inflated prices.
It has also been alleged that IGI USA''s grading standards differs substantially from those of other IGI Entities outside New
York and it offers to over-grade diamonds in line with Other IGI Entities'' grading standard for an illicit fee. The Company
have refuted these allegations and the matter is under litigation.

The Supreme Court of New York has passed an order 9^th December, 2025 granting dismissal of the same.

(c) Pursuant to the notice received by the Company from the Ministry of Corporate Affairs (MCA) for non compliances under
Companies Act, 2013, the Company has made an application for compunding for the non compliances as per applicable
provisions of Companies Act, 2013 and adequate provision has been made in the books in this regard, the matter is
currently pending adjudication.

(ii) Current Liabilities= Trade Payables Other financial Liabilities Current tax (Liabilities) Provisions Other Current
Liabilities Employee benefit obligations

(iii) Debt= long term borrowing and current maturities of long-term borrowing

(iv) Earning for Debt Service =Profit after taxes Non-cash operating expenses like depreciation and other amortizations
Interest

(v) Debt Service = Interest & Lease Payments Principal Repayments

(vi) Capital Employed= Tangible Net Worth Total Debt

(vii) Return on investment - Return on fixed deposit = Interest income earned during the year on average investment (fixed
deposits)

41 REVENUE FROM CUSTOMER41.1 Disaggregated revenue information

Set out below is the disaggregation of the Company''s revenue from contracts with customers:

42 SEGMENT REPORTING

The Company''s business activity primarily falls within a single business segment based on the nature of activity
involved, which is in line with the business risks attached with the segment having regard to the internal organisation and
management structure. The CODM reviews the Company''s performance as a single business segment and not at any
other disaggregated level. Hence, no separate financial disclosures provided in respect of its single business segment.

Operations of the Company are managed from India. Accordingly, the following have been identified as operating and
reportable segments: (a) "Within India”, and (b) "Outside India”. In presenting geographic information, segment revenue
has been based on the location of the customer and segment assets are based on geographical location of assets.

43 During the year ended 31^st December, 2024, the Company has completed the acquisition of 100% equity in IGI Netherland
B.V and International Gemmological Institute BV for a consideration of Rs. 7,523.62 million and Rs. 5,934.59 million,
respectively, out of which Rs. 13,000.00 million was paid out of the proceeds from IPO.

The Board of Directors of the Company, at its meeting held on 31^st January, 2026, approved an infusion of funds amounting
to Rs. 817.36 millions by way of investment in International Gemmological Institute BV ("IGI Belgium"), a wholly owned
subsidiary (""WOS"") of the Company. IGI Belgium, in turn, has invested the aforesaid funds in International Gemological
Institute Inc. (""IGI USA""), its wholly owned subsidiary and a step-down wholly owned subsidiary of the Company.

The funds so infused were utilised by IGI USA to acquire a 100% equity stake in AGL Holdco Inc., USA for a purchase
consideration of USD 13.2 millions. Consequently, AGL Holdco Inc. has become a wholly owned subsidiary of IGI USA and
a step-down wholly owned subsidiary of IGI Belgium and the Company.

44 During the year ended 31^st December, 2024, the Company has completed its Initial Public Offer (""IPO"") of 101,323,893
equity shares of face value of Rs. 2/- each comprising of fresh issue of 35,376,651 equity shares at an issue price of Rs.
417 per equity share aggregating to Rs. 14,750.00 million, except for 52,910 equity shares issued to eligible employees
under the "Employee Reservation Portion" of the IPO for which a discount of Rs. 39 per equity share was provided and
an offer for sale of 65,947,242 equity shares at an issue price of Rs. 417 per equity share aggregating to Rs. 27,500.00
million. Pursuant to IPO, equity shares of the Company were listed on BSE Limited and National Stock Exchange w.e.f.
20^th December, 2024.

The Company has received an amount of Rs. 14,097.40 million (net of IPO expenses of Rs. 652.60 million) from proceeds
out of fresh issue of equity shares. The IPO expenses incurred of Rs. 521.20 million (including deferred taxes) has been
adjusted against securities premium.

45 SHARE BASED PAYMENTSIGI Employee Stock Option Plan 2024 (ESOP 2024):

On 10^th August, 2024, the members of the Company approved the Employee Stock Option Plan 2024 ("ESOP 2024"). During
the previous year, the Nomination and Remuneration Committee in its meeting held on 18^th November, 2024 and 1^st December,
2024 had granted 20,951,824 options to the eligible employees of the Company under Employee Stock Option Plan 2024
("ESOP 2024")

46 CORPORATE SOCIAL RESPONSIBILITY

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least
2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR)
activities. A CSR committee has been formed by the Company as per the Act. The funds are utilised through the year on
these activities which are specified in Schedule VII of the Companies Act, 2013.

48 ADDITIONAL REGULATORY INFORMATION REQUIRED BY SCHEDULE IIIi) Details of benami property held

No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami
transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made there under.

ii) Borrowing secured against current assets

No such borrowings have been availed by the Company during the year.

iii) Wilful defaulter

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

iv) Relationship with struck off companies

The Company has no transactions with companies struck off under Companies Act, 2013 or Companies Act, 1956.

v) Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with Registrar of Companies.

vi) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013.

vii) Compliance with approved scheme(s) of arrangements

The Company has not entered into any scheme of arrangement which has an accounting impact in the current year.

viii) Undisclosed Income

The Company has not surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961, that
have not been recorded in the books of account.

ix) Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the reported year.

x) Valuation of PP&E, intangible asset and investment property

The Company has not revalued its property, plant and equipment or Investment Properties (including right-of-use assets)
or intangible assets.

xi) Utilisation of borrowed funds and share premium

The Company has not advanced or loaned 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 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

49 The Company has not entered into any agreements for loans or advances to the directors, promoters, KMP''s and related
parties where either loans and advances repayable on demand or without specifying any terms of period of payment

50.1 AUDIT TRAIL COMPLIANCE

The Company has used two accounting software systems for maintaining its books of account, both managed and
maintained by third-party service providers. These software systems have features for recording audit trails (edit logs)
facility, except that the audit trail feature at the application level for one of the software systems was enabled only from
June 20, 2025. Further, no audit trail feature was enabled at the database level in respect of one accounting software to
capture direct data changes. In respect of the other software, management were unable to comment on the audit trail at
the database level due to the absence of a SOC report or inadequate coverage in the available SOC report.

Further, where enabled, audit trail feature has operated throughout the period for all relevant transactions recorded in the
accounting softwares. Also, during the period, management did not come across any instance of audit trail feature being
tampered with in respect of such accounting softwares. Additionally, the audit trail has been preserved by the Company
as per the statutory requirements for record retention to the extent it was enabled and recorded in respective year.

The Company has used an accounting software for maintaining its books of accounts from September 01,2025 (managed
and maintained by a third-party software service provider) which has a feature of recording audit trail (edit log) facility
and the same has been operated throughout the period for all the relevant transactions recorded in the software. Further,
during the period and considering SOC report, management did not come across any instance of audit trail feature being
tampered with. Additionally, the said software was not maintained in the previous year and accordingly reporting under
Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail of such records as per the
statutory requirements for record retention is not applicable for the prior year"

50.2 Maintenance of books of account on server in India

As per the MCA notification dated August 5, 2022, the Central Government has notified the Companies (Accounts) Fourth
Amendment Rules, 2022. As per the amended rules, the Companies are required to maintain back-up of the books of
account and other relevant books and papers in electronic mode that should be accessible in India at all times. Also, the
Companies are required to maintain such back-up of accounts on servers which are physically located in India, on a daily
basis. The books of account along with other relevant records and papers of the Company are currently maintained in
electronic mode. These are readily accessible in India at all times and a back-up is maintained on a daily basis on servers
located in India.

51 CHANGE IN FINANCIAL YEAR

The Company had opted the period of 1^st day of January to 31^st day of December, each year as its financial year for the
purpose of preparation of financial statements under the provisions of Section 2(41) of the Companies Act, 2013, which
the Company Law Board had allowed. The Board of Directors on 5 November 2025 have approved the change of financial
year of the Company to uniform financial year commencing on 1^st April of every year and ending on 31^st March of the
following year. Consequently, as a transitional arrangement, the current financial year of the Company is for a period of 15
months commencing 1 January 2025 and ending 31 March 2026 while the previous financial year was of 12 months from
1 January 2024 to 31 December 2024.

52 On 21^st November, 2025, the Government of India notified the four Labour Codes - the Code on Wages, 2019, the Industrial
Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions
Code, 2020 (''Labour Codes'') - consolidating 29 existing labour laws. The Labour Codes, amongst other things introduced
changes, including a uniform definition of wages. The Company has estimated the financial implication of the change
in definition of wages based on certain estimates and assumptions including expected revisions to staff emoluments
which has resulted in an increase in the liability towards gratuity and compensated absences. The Company continues
to monitor the finalisation of Central/ State Rules and clarifications from the Government on other aspects of the Labour
Codes and impact estimates will be re-assessed and finalised based on the final Rules, industry practices, etc.

The total impact of past service cost arising out of change in definition of wages as per labour code is Rs. 30.18 millions
and toward long-term compensated absences is Rs. 25.32 millions.

53 EVENTS SUBSEQUENT TO BALANCE SHEET DATE

No significant subsequent events have been observed which may require an adjustments to the financial statements.

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Dec 31, 2024

The Company has provided loan to its wholly owned subsidiary to carry out business operations. The movement in the loan balance is on account of currency exchange fluctuation.

The Company has not entered with any Scheme(s) of arrangement in terms of sections 230 to 237 of the Companies Act, 2013.

No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries") with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

18.5 1. The Board of Directors passed a resolution at its meeting held on 25^th April, 2024 approving the sub-division of each equity share of face value of Rs. 10 each fully paid up into face value of Rs. 2 each fully paid up. The members in its Extra Ordinary General meeting dated 8^th May, 2024 have approved increase in the authorised share capital from Rs. 10 million divided into 5 million equity shares of Rs. 2 each (post split of shares) to Rs. 1,000 million divided into 500 million equity shares of Rs. 2 each. Further, the Board of Directors have also passed a resolution on 25^th April, 2024 and approved the issue of bonus equity shares in its meeting which was further approved by shareholder in the meeting held on 21^st May, 2024 in the ratio of 200 equity shares of Rs. 2 each for every 1 equity share of Rs. 2 each by capitalisation of such sum standing to the credit of general reserves of the Company.

2. During the year, the Nomination and Remuneration Committee in its meeting held on 18^th November, 2024 and 1^st December, 2024 had granted 20,951,824 options to the employees of the Company under Employee Stock Option Plan 2024 ("ESOP 2024"). Further, the shareholders of the Company has also approved to increase the authorised share capital from existing Rs. 1,000 million divided into 500 million equity shares Rs. 2 each to Rs. 1,100 million divided into 550 million equity shares of Rs. 2 each ranking pari passu in all respect with the existing equity shares of the Company as per the Memorandum and Articles of Association of the Company.

Nature & Purpose of Reserves

General Reserve: General reserve is created from time to time by transferring profits from retained earnings and can be utilised for purposes such as dividend payout, bonus issue, etc.

Retained Earnings: Retained earnings are the profits that the Company has earned till date, less any transfers to general reserves, dividends or other distributions paid to shareholders. It also includes re-measurement loss/gain on defined benefit plans, net of taxes that will not be reclassified to statement of profit and loss.

Share Premium: Share premium account comprises of premium on issue of shares. It is to be utilised in accordance with the provisions of the the Companies Act, 2013.

Share based payment reserve: The fair value of the equity-settled share based payment transactions with employees is recognised in Statement of profit and loss with corresponding credit to Share based payment reserve.

34. EARNINGS PER SHARE

Basic EPS amount is calculated by dividing the profit/loss for the period attributable to ordinary equity holders by the weighted average number of ordinary shares outstanding during the period.

Diluted EPS is calculated by dividing the profit attributable to ordinary equity holders by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.

35. EMPLOYEE BENEFITS (A) Defined contribution plans

The Company contributes to a defined contribution plan to Employee''s Provident Fund which are administered by the Provident Fund authorities and has no further obligation beyond making its contribution which is expensed in the year to which it pertains.

i) The Board of Directors at their meeting held on 25^th April, 2024 approved the sub-division of each equity share of face value of Rs. 10 each fully paid up into face value of Rs. 2 each fully paid up.

ii) Further, the Board of Directors have also approved the issue of bonus equity shares in its meeting held on 21^st May, 2024 in the ratio of 200 equity shares of Rs. 2 each for every 1 equity share of Rs. 2 each by capitalisation of such sum standing to the credit of free reserves of the Company.

iii) In line with the requirements of Ind AS 33, the basic and diluted earnings per share for the current and previous year presented have been calculated after considering the share split and bonus issue.

37. FINANCIAL INSTRUMENTS RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company is exposed primarily to credit risk and liquidity risk. The management of the Company oversees the management of these risks. The management is supported by a financial risk committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The financial risk committee provides assurance to the Company''s senior management that the Companies financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Companies policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks which are summarised below.

(i) Interest rate risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to its bank borrowings obtained with floating interest rates.

The Company is not exposed to the interest rate risk as there are no variable interest bearing borrowings/investments.

(ii) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s operating activities (when revenue or expense is denominated in a different currency from the Company’s functional currency).

Trade receivables:

The Company applies the Ind AS 109 simplified approach for measuring expected credit losses which uses a lifetime expected loss allowance (ECL) for trade receivables. The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.

The Company uses past data and experience based on Company’s historical default rates to measure the ECL on trade receivables. Based on evaluation carried out and to the best estimate of management, historical loss sufficiently covers expected loss as well as future contingencies. Adjustment for forward looking factors are not considered significant, hence no adjustment for forward looking factors is made.

(iii) 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. Credit risk arises principally from the Company’s trade receivables, security deposits, bank balances and other financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.

(iv) Liquidity risk

Liquidity risk is the current and prospective risk arising out of an inability to meet financial commitments as they fall due, through available cash flows or through the sale of assets at fair market value. Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due.

The Company’s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. The management monitors the Company’s net liquidity position through forecasts on the basis of expected cash flows.

Balances with banks as well as cash and cash equivalents are considered to have negligible risk or nil risk, as they are maintained with high rated banks as approved by the Board of directors.

Other financial assets mainly includes security deposit given, term deposits, loan to related parties, interest accrued on deposits, etc. Based on assessment carried by the Company, entire receivable under this category is classified as "Stage 1". There is no history of loss and credit risk and the amount of provision for expected credit losses on other financial assets is negligible.

(v) Fair value measurement hierarchy

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1- Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

The fair value of cash and cash equivalents, trade receivables, trade payables, other financial liabilities and other financial assets approximate their carrying amount largely due to short term nature of these instruments. The amortised cost using effective interest rate (EIR) of non-current financial assets consisting of security deposits are not significantly different from the carrying amount.

38. CAPITAL MANAGEMENT

The entity’s objectives when managing capital are to:

• safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

• Maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. Consistent with others in the industry, the Company monitors capital on the basis of the following gearing ratio: Net debt (total borrowings net of cash and cash equivalents) divided by Total ''equity’ (as shown in the statement of financial position). No changes were made in the objectives, policies or processes for managing capital during the reporting periods. There are no Debts taken by the Company. Therefore, Capital structure comprised of only equity as there are no external debts availed by Company.

(a) Mr. Rohit Agarwal (ex-employee) had filed a case against the Company with the Labour Court. An order was passed by Labour Court dated 11^th February, 2011 directing the Company to reinstate Mr. Agarwal as an employee and to pay back wages to him to the extent of 25% along with continuity of service with effect from 9^th April, 2002. Against the order of Labour court a writ petition was filed before the High court by the Company. By way of Order dated 10^th October, 2011, the High Court granted a stay on the Labour Court’s orders on the condition that Company Deposit back the wages in Court. An order dated 27^th January, 2012 recorded that Company has deposited Rs. 0.79 million i.e. 100% back wages from 27^th February, 2009 to 31^st October, 2011, with the Prothonotary and Senior Master of the High Court. The Writ Petition has been listed from time to time and is pending for final hearing.

(b) KS Trade LLC ("Complainant") has filed a complaint dated 21^th December, 2017 ("Complaint") against IGI International Gemmological Institute Inc. (IGI USA), International Gemmological Institute DMCC (IGI UAE) along with the Company (collectively, "IGI Entities") and others (together with IGI Entities, "Defendants"), before the Supreme Court of the State of New York. The Complainant has demanded USD 0.75 million and alleged inter alia that the Defendants conspired to misrepresent the true value of diamonds by intentionally over-grading diamonds in IGI Entities’ affiliated laboratories outside of New York, thereby allowing diamond dealers and wholesalers to re-sell diamonds at artificially inflated prices.

It has also been alleged that IGI USA’s grading standards differs substantially from those of other IGI Entities outside New York and it offers to over-grade diamonds in line with Other IGI Entities'' grading standard for an illicit fee. The Company have refuted these allegations and the matter is under litigation.

(c) Pursuant to the notice received by the Company from the Ministry of Corporate Affairs (MCA) for non compliances under Companies Act, 2013, the Company has made an application for compunding for the non compliances as per applicable provisions of Companies Act, 2013 and adequate provision has been made in the books in this regard, the matter is currently pending adjudication.

42. SEGMENT REPORTING

The Company’s business activity primarily falls within a single business segment based on the nature of activity involved, which is in line with the business risks attached with the segment having regard to the internal organisation and management structure. The CODM reviews the Company’s performance as a single business segment and not at any other disaggregated level. Hence, no separate financial disclosures provided in respect of its single business segment.

Operations of the Company are managed from India. Accordingly, the following have been identified as operating and reportable segments: (a) "Within India", and (b) "Outside India". In presenting geographic information, segment revenue has been based on the location of the customer and segment assets are based on geographical location of assets.

43. During the year, the Company has completed the acquisition of 100% equity in IGI Netherland B.V. and International Gemmological Institute BV for a consideration of Rs. 7,523.62 million and Rs. 5,934.59 million, respectively, out of which Rs. 13,000.00 million was paid out of the proceeds from IPO.

44. During the year ended 31^st December, 2024, the Company has completed its Initial Public Offer ("IPO") of 101,323,893 equity shares of face value of Rs. 2/- each comprising of fresh issue of 35,376,651 equity shares at an issue price of Rs. 417 per equity share aggregating to Rs. 14,750.00 million, except for 52,910 equity shares issued to eligible employees under the "Employee Reservation Portion" of the IPO for which a discount of Rs. 39 per equity share was provided and an offer for sale of 65,947,242 equity shares at an issue price of Rs. 417 per equity share aggregating to Rs. 27,500.00 million. Pursuant to IPO, equity shares of the Company were listed on BSE Limited and National Stock Exchange w.e.f. 20^th December, 2024.

The Company has received an amount of Rs. 14,097.40 million (net of IPO expenses of Rs. 652.60 million) from proceeds out of fresh issue of equity shares. The IPO expenses incurred of Rs. 521.20 million (including deferred taxes) has been adjusted against securities premium.

46. CORPORATE SOCIAL RESPONSIBILITY

As per Section 135 of the Companies Act, 2013, a Company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. A CSR committee has been formed by the Company as per the Act. The funds are utilised through the year on these activities which are specified in Schedule VII of the Companies Act, 2013.

48. ADDITIONAL REGULATORY INFORMATION REQUIRED BY SCHEDULE III

i) Details of benami property held

No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made there under.

ii) Borrowing secured against current assets

No such borrowings have been availed by the Company during the year.

iii) Wilful defaulter

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

iv) Relationship with struck off companies

The Company has no transactions with companies struck off under Companies Act, 2013 or Companies Act, 1956.

v) Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with Registrar of Companies.

vi) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013.

vii) Compliance with approved scheme(s) of arrangements

The Company has not entered into any scheme of arrangement which has an accounting impact in the current year.

viii) Undisclosed Income

The Company has not surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961, that have not been recorded in the books of account.

ix) Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the reported year.

x) Valuation of PP&E, intangible asset and investment property

The Company has not revalued its property, plant and equipment or Investment Properties (including right-of-use assets) or intangible assets.

xi) Utilisation of borrowed funds and share premium

The Company has not advanced or loaned 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 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

49 CONVERSION OF THE COMPANY FROM PRIVATE LIMITED TO PUBLIC LIMITED

Pursuant to resolution passed by the Members in the Extra odinary General Meeting dated 19^th June 2024 and as approved by Registrar of the Company w.e.f. 10^th July 2024, the Company has been converted from Private Limited Company into a Public Limited Company including adoption of new Memorandum of Association and new Articles of Association as applicable to Public Company in place of existing Memorandum of Association and Articles of Association of the Company.

50 CODE OF SOCIAL SECURITY, 2020

The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come in to effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period when the Code becomes effective

51 The Accounts of the Company have been prepared on "going concern basis". The Board of Directors are of the Opinion that the Current Assets, Loans and Advances have realisation value of an amount equivalent to their stated carrying values

52 The Company has not entered into any agreements for loans or advances to the directors, promoters, KMP’s and related parties where either loans and advances repayable on demand or without specifying any terms of period of payment

53.1 AUDIT TRAIL COMPLIANCE

The Company has used an accounting software for maintaining its books of account from 1^st January, 2024 to 31^st October, 2024 which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, there were no instance of audit trail feature being tampered with.

Further, the Company migrated to a new accounting software from 1^st November, 2024 for which used for maintaining its books of account, which and was managed and maintained by a third-party service provider. In the absence of sufficient and appropriate audit evidence, due to non availability of SOC report, the management was unable to determine whether the database of the software to log any direct changes has a feature of recording audit trail (edit log) facility and whether the same has been enabled and operated for the period from 1^st November, 2024 to 31^st Decemeber, 2024 for all relevant transaction recorded or whether there is is any instance of audit trail feature being tampered with.

The Company has used an accounting software for maintaining transactions for revenue which has a feature of recording the audit trail (edit log) facility, except that audit trail feature was not enabled throughout the year for certain relevant transactions recorded in the accounting software at the application level. Further, the audit trail feature was not enabled at the database level within the accounting software to log any direct changes.

Further, to the extent enabled, the audit trail feature has been operated for the relevant transactions recorded in the accounting software and there were no instance of the audit trail feature being tampered with. Additionally, the audit trail feature of previous year has been preserved by the Company as per the statutory requirements for record retention to the extent it was enabled and recorded in previous year.

53.2 MAINTENANCE OF BOOKS OF ACCOUNT ON SERVER IN INDIA

As per the MCA notification dated 5^th August, 2022, the Central Government has notified the Companies (Accounts) Fourth Amendment Rules, 2022. As per the amended rules, the Companies are required to maintain back-up of the books of account and other relevant books and papers in electronic mode that should be accessible in India at all times. Also, the Companies are required to maintain such back-up of accounts on servers which are physically located in India, on a daily basis. The books of account along with other relevant records and papers of the Company are currently maintained in electronic mode. These are readily accessible in India at all times and a back-up is maintained on a daily basis on servers located in India.

54 EVENTS SUBSEQUENT TO BALANCE SHEET DATE

The Board of Directors of the Company in its meeting held on 22^nd February, 2025 had declared the interim dividend of Rs. 2.44 per equity share of face value of Rs. 2/- each for the year ended 31^st December, 2024. The record date for the purpose of said interim dividend is 28^th February, 2025.