Notes to Accounts of Jainam Ferro Alloys (I) Ltd.

Mar 31, 2025

PROVISIONS AND CONTINGENCIES

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 of the amount can be made. Provisions are

determined based on best estimate required to settle
the obligation at the Balance Sheet date. 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 the time value of the money is material). The
increase in the provisions due to passage of time is
recognized as interest expense. Provisions are
reviewed as at each reporting date and adjusted to
reflect the current estimate.

Contingent liabilities are disclosed when there is a
possible obligation arising from past events, the
existence of which will be confirmed only by the
occurrence or non-occurrence of one or more uncertain
future events not wholly within the control of the
Company or a present obligation that arises from past
events where it is either not probable thatan outflow of
resources will be required to settle or a reliable
estimate of the amount cannot be made.

Contingent assets are not disclosed in the financial
statements unless an inflow of economic benefits is
probable.

DIVIDEND

Final dividend on shares is recorded as a liability on
the date of approval by the shareholders and interim
dividends are recorded as a liability on the date of
declaration by the Company''s Board of Directors.

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Mar 31, 2024

THE MEMBERS OF JAINAM FERRO ALLOYS (I) LIMITED RAIPUR (C.G.)

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the accompanying Standalone Financial Statements of JAINAM FERRO ALLOYS (I) LIMITED ("the Company"), which comprise the Standalone Balance Sheet as at March 31, 2024, and the Standalone Statement of Profit and Loss (including other comprehensive income), Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows for the year then ended, and a summary of significant accounting policies and other explanatory information (hereinafter referred to as "the financial Statements"), which we have signed under reference to this report.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March, 2024 and its Profit, Changes in Equity and its Cash Flows for the year ended on that date.

Basis for opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the Standalone Financial Statements under the provisions of the Companies Act, 2013 and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the Standalone Financial Statements of the current period. These matters were addressed in the context of our audit of the Standalone Financial Statements as a whole, and informing our opinion thereon, and we do not provide a separate opinion on these matters.

We have determined that there are no key audit matters to be communicated in our report. Other Information

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Board of Director''s report for the year ended 31st March, 2024, but does not include the financial statements and our auditor''s report thereon. The Company''s annual report is expected to be made available to us after the date of this auditor''s report.

Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements, or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

Responsibility of Management for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these Standalone Financial Statements that give a true and fair view of the state of affairs, profit/loss (including other comprehensive income), changes in equity and cash flows of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards prescribed under Section 133 of the Act read with the companies (Indian Accounting Standards) Rules, 2015 as amended.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate implementation and maintenance of accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Financial Statements that gives true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are also Responsible for Overseeing the Company''s Financial Reporting Process.

Auditor''s Responsibilities for the Audit of the Standalone Financial Statement

Our objectives are to obtain reasonable assurance about whether the Standalone Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of the auditor''s responsibilities for the audit of the Standalone Financial Statements is included in Annexure A. This description forms part of our auditor''s report.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143 (3) of the Act, based on our audit, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) The Standalone Balance Sheet, and the Standalone Statement of Profit and Loss (including other comprehensive income), Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations received from the directors of the Company as on 31 March, 2024 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March, 2024 from being appointed as a director in terms of Section 164 (2) of the Act;

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B", our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s Internal financial controls over financial reporting, and

(g) With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:

(i) The Company did not have any pending litigations which would impact its financial positions.

(ii) The Company did not have any long-term contracts including derivative contracts for which there were any foreseeable losses.

(iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

(iv) With respect to reporting regarding advances, loans & investments, further lending or investing other than disclosed in the notes to financial statements: -

• The management has represented that, to the best of its knowledge and belief, 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, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

• The management has represented that, to the best of its knowledge and belief, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

• Based on such audit procedures that were considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.

(v) The company has not declared any dividend during the year under audit.

(vi) Based on our examination, which included test checks, the Company has used accounting softwares for maintaining its books of account for the financial year ended March 31, 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 softwares.

Further, during the course of our audit for the periods where audit trail (edit log) facility was enabled and operated, we did not come across any instance of the audit trail feature being tampered with.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from 01.04.2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31 2024.

(h) With respect to the matter to be included in the Auditors'' Report under Section 197(16) of the Act:

In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) of the Act which are required to be commented upon by us.

2. As required by the Companies (Auditor''s Report) Order, 2020 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the "Annexure C", a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable.

FOR, S M A G AND ASSOCIATES LLP (Formerly known as "Sunil Johri And Associates")

CHARTERED ACCOUNTANTS (Firm Reg. No. 005960C/C400353)

sd/-

CA. SUNIL JOHRI M.No. 074654 Partner

Date: 28-05-2024 Place: Raipur, C.G.

UDIN: 24074654BKLSXH2563

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Mar 31, 2023

During the year 2021-22, the Company has completed its Initial Public Offer (IPO) of 28,02,000 equity shares of face value Rs. 10/- each at an issue price of Rs. 70/-per share (including a share premium of Rs. 60/- per share). The Issue comprised of a fresh issue and allotment of 13,02,000 equity shares aggregating to Rs. 911.40 lakhs and offer for sale of 15,00,000 equity shares by selling shareholders aggregating to Rs. 1050.00 lakhs.

The Company has issued one class of shares referred to as equity shares having a par value of Rs. 10/- . Each holder of equity shares is entitled to one vote per share.

The Company has issued bonus equity shares during the Financial Year 2018-19 in the ratio of 7:5 i.e. 7 Bonus Equity Shares for every 5 Equity Shares held in the company. The "Record Date” for Bonus Issue was 13/07/2018.

In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company, after distribution of all prefrential accounts, in proportion to their shareholding.

Secured

I. Kotak Mahindra Bank has sanctioned a Cash Credit Limit (as Sub-limit of LC) of Rs. in lakhs 2100.00 Lakhs for the working capital requirements of the company.

The Securities pledged agains such CC Limit are as follows:

Primary Security:

First and Exclusive Charge on all existing and future current assets of the Borrower.

Collateral Security:

1. Equitable Mortgage over Lease Hold Land of the company (Address: PLOT NO. 103 TO 113 & 130 TO 136/A & 137, SECTOR-C URLA INDUSTRIAL AREA RAIPUR CT 492003 IN)

2. Lien Marked on Fixed Deposit of Rs. in lakhs 214.60 Lakhs with Kotak Mahindra Bank.

3. Equitable Mortgage over Plot No. A-25 at Wallfort City, Raipur owned by Mr. Arpit Parakh

4. Equitable Mortgage over Plot No. A-26 at Wallfort City, Raipur owned by Mr. Abhay Parakh

5. Unit No. B - 401 & Unit No. A -411, Second Floor, "Nahata Market Condominium" Ward No. - 57, Vivekanand Ward, Situated at Sadar Bazar, Raipur (C. G.) 492001 owned by Sanjay Parakh

6. Unit No. - 220, Second Floor, "Jairam Complex" Ward No - 17 Moudhapara Ward, Mouja Raipur Khas, Tahsil & Dist. Raipur, (C.G.) 492001 owned by Sanjay Parakh

7. Commercial Unit/Office No. 315, 3rd Floor. "Wallfort Ozone", Mauza - Raipur Khas, Shahid Hemu Kalyani Ward No. - 35, Kh. No. - 135, Sheet No. - 40, Plot No. - 01, R.n.m. - Raipur - 01, T ah. & Dist. - Raipur (C.G.) 492001 owned by Rita Parakh

Personal Guarantee: Mr. Archit Parakh, Mr. Arpit Parakh, Mr. Ajay Parakh and Mr. Abhay Parakh

II. Kotak Mahindra Bank has sanctioned a car loan of Rs. in lakhs 50.00 Lakhs for purchase of BMW 620D car of the company, repayble in 12 EMI’s of Rs. in lakhs 432800, Rate of Interest 7.53% p.a., First EMI Paid in September 2021 and Last EMI paid in August 2022.

Except for the above, the management is of the opinion that there are no claims against the company, which are not acknowledged as debts.

26. In opinion of the board

i) All known liabilities have been provided for.

ii) All material items have been disclosed in the financial statement.

iii) There are no material changes in accounting policies as compared to previous year.

iv) Prior period items and extra ordinary items which are material and if any are disclosed separately.

v) There is no such event occurred after the date of balance sheet, which needs disclosure in their account.

27. Confirmation letters have been issued in respect of trade receivables and other receivables, advances for capital goods, loans and advances, sundry debtors, and trade payables and other payables of the company but not responded to in most cases. Hence, unconfirmed balances are subject to reconciliation and consequent adjustments, if any, would be determined / made on receipt of confirmation. However, in the opinion of the Board, all assets other than fixed assets and non-current investments have a realizable value in the ordinary course of business, which is not different from the amount at which it is stated.

28. The outstanding balance as at 31^st March 2023 in respect of Secured Loans, Sundry Creditors, Loans and Advances, Deposits are subject to confirmation / reconciliation from the respective parties and the same have been reckoned in these accounts as per the balances appearing in the books. Any further adjustments arising out of reconciliation will be accounted for as and when such reconciliation is completed. The company however does not expect any material variance.

31. Employee Benefits

As required by Ind AS-19 ''Employee Benefits'' the disclosures are as under: a. Defined Contribution Plans

The Company offers its employees defined contribution plans in the form of Provident Fund (PF) and certain state plans such as Employees'' State Insurance (ESI). PF covers substantially all regular employees and the ESI covers certain workers. Contributions are made to the Government''s funds. Both the employees and the Company pay predetermined contributions into the Provident Fund and the ESI Scheme. The contributions are normally based on a certain proportion of the employee''s salary. During the year, the Company has recognized the following amounts in the Account.

33. Segment Information for the year ended 31^st March 2023.

* Business Segment - The Company has considered the present business segment as the primary segment to disclose. The company is engaged in Manufacturing and Sale of Ferro Manganese & Silico Manganese during the year which is considered as the only business segment.

* Geographical Segment - The Company sell its product within India. The condition prevailing in India being uniform, no separate geographical segment disclosure is considered necessary.

34. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure. Figures rounded off to nearest rupees.

38. In respect of Micro / Small / Medium Enterprises Development Act, 2006, certain disclosures are required to be made relating to Micro / Small / Medium Enterprises. The company is in the process of compiling relevant information''s from its suppliers about their coverage under the act. Few parties have not provided any details regarding their coverage under the said act. Hence, such parties have been considered as other than Micro / Small / Medium Enterprises and the interest payable to Parties who are registered as MSME could not be ascertained and has not been provided for in the books of accounts.

39. Disclosures in respect of Financial Assets in accordance with Ind AS - 107:

The management has made an irrevocable election to measure its investments in equity instruments at fair value through other comprehensive income since such investments, as informed by the management are not held for trading and the gains and losses on account of Fair Value Measurement & Derecognition of such equity instruments shall be recognized through Other Comprehensive Income and shall be transferred to Other Equity at the time of Derecognition.

The management decided to Derecognize certain Equity Instruments during the year due to several factors such as market conditions, liquidity, prevailing interest rate etc. which formed a basis of decision making while acquiring such equity instruments. Such Equity instruments Being Quoted at various stock exchanges in India were derecognised at Fair value as on the dates of Derecognition.

40. Corporate Social Responsibility Expenditure:

a. The Company earned a Net Profit of Rs. 28.02 Crores during the year ended on 31^st March 2022 and was required to make compliance of Section 135 of Companies Act'' 2013 by spending 2% of its Average Net Profit of past three year (Computed in accordance with Sections 198 of the Act) during the financial year ended on 31^st March 2023.

b. CSR amount required to be spent as per Section 135 of Companies Act'' 2013 read with Schedule VII thereof by the company during the year is Rs. 28.66 Lakhs (Previous Year - Nil). The required amount has been spent on eligible areas during the financial year.

41. In the year 2016, our Company took over the ferro alloy plant of M/s Raghuvir Ferro Alloys Private Limited vide Sale deed dated June 21, 2016. Pursuant to the sale deed the company acquired the entire factory of M/s Raghuvir Ferro Alloys Private Limited and the allotted manganese ore mines at K.H. No. 8/2, 9/1, 10/1, 10/2 and 14/1, Village Jagantola, Tehsil - Baihar, District Balaghat, Madhya Pradesh with valid lease period upto 2028 which was later extended upto 2058 by the State Government vide Extension Lease Deed dated April 11, 2018. The Manganese ore Mines are inoperative and have not been voluntarily transferred in the name of our Company. However, our Company has now appointed Soham Ferro Manganese Private Limited and Ashutosh Sanyashi, Geologist to prepare Mining Plan - DGPS Survey Report of the said Mines. Thus, once the mining plan is ready, we will submit it to the state government. Pursuant to approval of the said mining plan the mines shall get transferred in our name. Meanwhile the assessment of Royalty on Manganese Ore over the said mines was also conducted by the Collector of the Dist. Balaghat (M.P) on September 10, 2021, post which the mining plan can be submitted to the department.

42. The figures in Financial Statements are presented in Rs. In Lakhs and hence the totals at various pages may appear to be different from apparent total, but such anomaly is merely due to presentation of figures in Lakhs.

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

(iv) The Company has not traded or invested in Crypto Currency or Virtual Currency during the financial year.

(v) The Company have 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

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

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

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

(vii) 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 Ac, 1961 (such as search or survey or any other relevant provisions of Income Tax Act, 1961).

(viii) The Company has not been declared as Wilful Defaulter by any Banks, Financial Institutions or Other lenders.

(ix) The Company has been sanctioned working capital limits in excess of Rs. Five crores in aggregate from banks and/or financial institutions during the year on the basis of security of current assets of the Company. The quarterly returns/statements filed by the Company with such banks and financial institutions are in agreement with the books of account of the Company.