Notes to Accounts of KPT Industries Ltd.

Mar 31, 2025

A Provision is recognized when the Company has a present obligation as a result of a past event and it is probable that an
outflow of resources is expected to settle the obligation, in respect of which a reliable estimate can be made.

Contingent liability is disclosed in case of:

• A present obligation arising from past events, when it is not probable that an outflow of resources will be required to
settle the obligation,

• Present obligation arising from past events, when no reliable estimate is possible, and

• Possible obligation arising from past events where the probability of outflow of resources is remote.

Contingent assets are neither recognized, nor disclosed.

Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.

Warranty provisions

Provisions for warranty-related costs are recognized when the product is sold to the customer. Initial recognition is based on
historical experience. The initial estimate of warranty-related costs is revised annually.

27.17Leases

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time
in exchange for consideration.

As a Lessee

A lessee is required to recognize assets and liabilities for all leases and to recognize depreciation of leased assets separately from
interest on lease liabilities in the statement of Profit and Loss. The Company uses the practical expedient to apply the requirements
of this standard to a portfolio of leases with similar characteristics if the effects on the financial statements of applying to the portfolio
does not differ materially from applying the requirement to the individual leases within that portfolio.

However, when the lessee and the lessor each have the right to terminate the lease without permission from the other party with no
more than an insignificant penalty the Company considers that lease to be no longer enforceable. Also, according to Ind AS 116,
for leases with a lease term of 12 months or less (short-term leases) and for leases for which the underlying asset is of low value,
the lessee is not required to recognize right-of-use asset and a lease liability. The Company applies both recognition exemptions.
The lease payments associated with those leases are generally recognized as an expense on a straight-line basis over the lease
term or another systematic basis if appropriate.

Right-of-use assets:

Right-of-use assets, which are included under property, plant and equipment, are measured at cost less any accumulated
depreciation and, if necessary, any accumulated impairment. The cost of a right-of-use asset comprises the present value of
the outstanding lease payments plus any lease payments made at or before the commencement date less any lease incentives
received, any initial direct costs and an estimate of costs to be incurred in dismantling or removing the underlying asset. In this
context, the Company also applies the practical expedient that the payments for non-lease components are generally recognized
as lease payments. If the lease transfers ownership of the underlying asset to the lessee at the end of the lease term or if the cost
of the right-of-use asset reflects that the lessee will exercise a purchase option, the right-of-use asset is depreciated to the end of
the useful life of the underlying asset. Otherwise, the right-of-use asset is depreciated to the end of the lease term.

Lease Liability:

Lease liabilities, which are assigned to financing liabilities, are measured initially at the present value of the lease payments.
Subsequent measurement of a lease liability includes the increase of the carrying amount to reflect interest on the lease liability
and reducing the carrying amount to reflect the lease payments made.

As a lessor

Lease income from operating leases where the Company is a lessor is recognized in income on a straight-line basis over the lease
term unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary
cost increases. The respective leased assets are included in the balance sheet based on their nature.

27.18lmpairment of non-financial assets

The company assesses at each balance sheet date whether there is any indication that an asset or cash generating unit
(CGU) may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. The
recoverable amount is the higher of an asset’s or CGU’s net selling price or its value in use. Where the carrying amount of
an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable
_amount._

The Company measures certain financial instruments such as Investments at fair value at each balance sheet date. Fair
value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an
arm’s length transaction. Quoted market prices, when available, are used as the measure of fair value. In cases where quoted
market prices are not available, fair values are determined using present value estimates or other valuation techniques,
for example, the present value of estimated expected future cash flows using discount rates commensurate with the risks
involved. Fair value estimation techniques normally incorporate assumptions that market participants would use in their
estimates of values, future revenues, and future expenses, including assumptions about interest rates, default, prepayment
and volatility. Because assumptions are inherently subjective in nature, the estimated fair values cannot be substantiated by
comparison to independent market quotes and, in many cases, the estimated fair values would not necessarily be realized in
an immediate sale or settlement of the instrument.

For cash and other liquid assets, the fair value is assumed to approximate to book value, given the short- term nature of these
instruments. For those items with a stated maturity exceeding twelve months, fair value is calculated using a discounted cash
flow methodology.

The financial instruments carried at fair value were categorized under the three levels of the Ind AS fair value hierarchy as
follows:

Level 1: Quoted market prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability
to access. This level of the fair value hierarchy provides the most reliable evidence of fair value and is used to measure fair
value whenever available.

Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e.
as prices) or indirectly (i.e. derived from prices).

Level 3: Inputs for the asset or liability that is not based on observable market data (unobservable inputs). These inputs
reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the asset
or liability (including assumptions about risk). These inputs are developed based on the best information available in the
circumstances, which include the Company’s own data. The Company’s own data used to develop unobservable inputs is
adjusted if information indicates that market participants would use different assumptions.

27.20Financial instruments

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

Financial assets

Initial recognition and measurement

All financial assets are recognized initially at fair value. Purchases or sales of financial assets that require delivery of assets
within a time frame established by regulation or convention in the market place (regular way trades) are recognized on the
trade date, i.e., the date that the Company commits to purchase or sell the asset.

Subsequent measurement

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

• Debt instruments at amortized cost

• Debt instruments at fair value through other comprehensive income (FVTOCI)

• Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)

• Equity instruments measured at fair value through other comprehensive income (FVTOCI)

Derecognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or
it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards
of ownership of the financial asset are transferred or in which the company neither transfers nor retain substantially all of the
risks and rewards of ownership and it does not retain control of the financial asset.

Impairment of financial asset

Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the following
financial assets and credit risk exposure:

• Financial assets that are debt instruments, and are measured at amortized cost e.g., loans, debt securities, deposits,
trade receivables and bank balance.

• Financial assets that are debt instruments and are measured as at FVTOCI.

• Lease receivables.

• Trade receivables or any contractual right to receive cash or another financial asset that result from transactions that
are within the scope of Ind AS 115.

• Loan commitments which are not measured as at FVTPL.

• Financial guarantee contracts which are not measured as at FVTPL.

The Company follows ‘simplified approach’ for recognition of impairment loss allowance on:

• Trade receivables or contract revenue receivables; and

• All lease receivables resulting from transactions within the scope of Ind AS 116

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. For recognition of impairment loss
on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the
credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss.
However, if credit risk has increased significantly, lifetime ECL is used.

Financial liabilities

Initial recognition and measurement

The company initially recognizes loans and advances, deposits, debt securities issued and subordinated liabilities on the date
on which they are originated. All other financial instruments (including regular-way purchases and sales of financial assets)
are recognized on the trade date, which is the date on which the company becomes a party to the contractual provisions of
the instrument.

A financial asset or financial liability is measured initially at fair value, for an item not at fair value through profit or loss,
transaction costs that are directly attributable to its acquisition or issue.

Derecognition

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

27.21 Earnings per share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by
the weighted average number of equity shares outstanding during the period as reduced by number of shares bought back, if
any. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue,
bonus element in a rights issue, share split, and reverse share split (consolidation of shares) that have changed the number
of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net 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.

27.22Borrowings

Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at
amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in
profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan
facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be
drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable
that some or all of the facility will be drawn down, the fee is capitalized as a prepayment for liquidity services and amortized
over the period of the facility to which it relates

Preference shares, which are mandatory redeemable on a specific date, are classified as liabilities. The dividends on these
preference shares are recognized in profit or loss as finance costs

Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or
expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to
another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in
profit or loss as other gains/(losses).

Borrowings are classified as current liabilities unless they have an unconditional right to defer settlement of the liability for at
least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on
or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date,
the entity does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of
the financial statements for issue, not to demand payment as a consequence of the breach.

27.23 Government grants

Government grants are recognized where there is reasonable assurance that the grant will be received and all attached conditions
will be complied with. When the grant relates to an expense item, it is recognized as income on a systematic basis over the periods
that the related costs, for which it is intended to compensate, are expensed. When the grant relates to an asset, it is recognized as
income in equal amounts over the expected useful life of the related asset

27.24 Standards issued but not effective

The Ministry of Corporate Affairs (“MCA”) has vide notification dated May 7, 2025 notified Companies (Indian Accounting Standards)
Amendment Rules, 2025 (the ‘Rules’) which amends certain accounting standards, and are effective from 1 April 2025 onwards.
The summary of amendments is as follows -

Ind AS 21, The Effects of Changes in Foreign Exchange Rates - These amendments provide guidance on when a currency
is considered as exchangeable, application guidance on determining exchangeability and estimating spot rates, disclosure
requirements when the currency is not exchangeable and references to matters contained in other Indian Accounting Standards.

Ind AS 101, First-time Adoption of Ind AS - Corresponding amendments are made to Ind AS 101 in line with the above mentioned
amendments in Ind AS 21 with respect to entity having functional currency that is subject to severe hyperinflation or lacking
exchangeability.

Company’s principal financial liabilities, comprises loans and borrowings, trade and other payables and other financial liabilities.
The main purpose of these financial liabilities is to finance company''s operations. Company’s principal financial assets include
investments, trade and other receivables, security deposits, cash and cash equivalents and other bank balances that derive
directly from its operations.

Company is exposed to certain risks which includes market risk, credit risk and liquidity risk.

Company''s senior management takes care of Company''s financial risk activities through appropriate policies and procedures.
The policies for managing these risks are summarised below.

1) Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a
financial loss. The company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing
activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
Company uses expected credit loss model for assessing and providing for credit risk.

a) Trade receivable

Customer credit risk is managed by the company under the guidance of the credit policy, procedures and control relating to customer
credit risk management. Credit quality of a customer is assessed based on financial position, past performance, business/economic
conditions, market reputation , expected business etc. Based on this evaluation, credit limit and credit terms are decided. Exposure on
customer receivables are regularly monitored and managed through credit lock and release. For export customers, credit insurance
is generally taken. An impairment analysis is performed at each reporting date on an individual basis for all the customers. The
impairment is based on expected credit model considering the historical data and financial position of individual customer at each
reporting period. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets. Trade
receivables are non-interest bearing and are generally on, 40 days to 180 days credit term. The company has low concentration of risk
as customer base in widely distributed both economically and geographically.

Credit risk from balances with banks and financial institutions is managed by the company’s finance department in accordance
with company’s policy. Investments of surplus funds are made only with approved counterparties and within credit limits
assigned to each counterparty. Company monitors rating, credit spreads and financial strength of its counter parties. Based on
ongoing assessment company adjust its exposure to various counterparties. Company''s maximum exposure to credit risk for
the components of statement of financial position is the carrying amount.

2) Liquidity risk

Liquidity risk is the risk that the company may not be able to meet its present and future cash flow and collateral obligations without
incurring unacceptable losses. Company''s objective is to, at all time maintain optimum levels of liquidity to meet its cash and collateral
requirements. Company closely monitors its liquidity position. It maintains adequate sources of financing including overdraft, debt
from domestic and international banks at optimized cost.

3) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market
prices. Market risk comprises three types of risk:- interest rate risk, currency risk and other price risk such as equity price risk and
commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits, investments.

Company''s activities expose it to variety of financial risks, including effect of changes in foreign currency exchange rate and interest
rate.

a) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in
market interest rates. The company has been availing the borrowings on variable rate of interest. The borrowings on a variable
rate of interest are subject to interest rate risk as defined in Ind AS 107.

b) Foreign Currency Exposure Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure 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, expense, assets & liabilities is denominated in a foreign currency).

45. Note on Undisclosed Income If any

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).

Also none of the previously unrecorded income and related assets have been recorded in the books of account during the year.

47. Disclosure related to reporting under rule 11(e) of the Companies (Audit and Auditors) Rules, 2014, as amended.

1) 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 any other person or entities, 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.

2) No funds have been received by the Company from any person or entity, 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.

49. Previous Years figures are rearranged and regrouped wherever necessary.

As per our report of even date

For and On behalf of Board of Directors

For P G BHAGWAT LLP Dilip Kulkarni Prabha Kulkarni

Chartered Accountants Managing Director Director

FRN: 101118W/W100682 DIN: 00184727 DIN: 00053598

Mr.Akshay B. Kotkar Suhas Kharote Ms. Aishwarya Toraskar

Partner Chief Finance Officer Company Secretary

M.No.: 140581 M. No.: A54931

Place : Kolhapur Place : Shirol

Date : 23^rd May, 2025 Date : 23^rd May, 2025

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Mar 31, 2024

27.16 Provisions

A Provision is recognized when the Company has a present obligation as a result of a past event and it is probable that an outflow of resources is expected to settle the obligation, in respect of which a reliable estimate can be made.

Contingent liability is disclosed in case of:

• A present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation,

• Present obligation arising from past events, when no reliable estimate is possible, and

• Possible obligation arising from past events where the probability of outflow of resources is remote.

Contingent assets are neither recognized, nor disclosed.

Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.

Warranty provisions

Provisions for warranty-related costs are recognized when the product is sold to the customer. Initial recognition is based on historical experience. The initial estimate of warranty-related costs is revised annually.

27.17 Leases

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

As a Lessee

A lessee is required to recognize assets and liabilities for all leases and to recognize depreciation of leased assets separately from interest on lease liabilities in the statement of Profit and Loss. The Company uses the practical expedient to apply the requirements of this standard to a portfolio of leases with similar characteristics if the effects on the financial statements of applying to the portfolio does not differ materially from applying the requirement to the individual leases within that portfolio.

However, when the lessee and the lessor each have the right to terminate the lease without permission from the other party with no more than an insignificant penalty the Company considers that lease to be no longer enforceable. Also, according to Ind AS 116, for leases with a lease term of 12 months or less (short-term leases) and for leases for which the underlying asset is of low value, the lessee is not required to recognize right-of-use asset and a lease liability. The Company applies both recognition exemptions. The lease payments associated with those leases are generally recognized as an expense on a straight-line basis over the lease term or another systematic basis if appropriate.

Right-of-use assets:

Right-of-use assets, which are included under property, plant and equipment, are measured at cost less any accumulated depreciation and, if necessary, any accumulated impairment. The cost of a right-of-use asset comprises the present value of the outstanding lease payments plus any lease payments made at or before the commencement date less any lease incentives received, any initial direct costs and an estimate of costs to be incurred in dismantling or removing the underlying asset. In this context, the Company also applies the practical expedient that the payments for non-lease components are generally recognized as lease payments. If the lease transfers ownership of the underlying asset to the lessee at the end of the lease term or if the cost of the right-of-use asset reflects that the lessee will exercise a purchase option, the right-of-use asset is depreciated to the end of the useful life of the underlying asset. Otherwise, the right-of-use asset is depreciated to the end of the lease term.

Lease Liability:

Lease liabilities, which are assigned to financing liabilities, are measured initially at the present value of the lease payments. Subsequent measurement of a lease liability includes the increase of the carrying amount to reflect interest on the lease liability and reducing the carrying amount to reflect the lease payments made.

As a lessor

Lease income from operating leases where the Company is a lessor is recognized in income on a straight-line basis over the lease term unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases. The respective leased assets are included in the balance sheet based on their nature.

27.18 Impairment of non-financial assets

The Company assesses at each balance sheet date whether there is any indication that an asset or cash generating unit (CGU) may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. The recoverable amount is the higher of an asset’s or CGU’s net selling price or its value in use. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

27.19 Fair value measurement

The Company measures certain financial instruments such as Investments at fair value at each balance sheet date. Fair value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction. Quoted market prices, when available, are used as the measure of fair value. In cases where quoted market prices are not available, fair values are determined using present value estimates or other valuation techniques, for example, the present value of estimated expected future cash flows using discount rates commensurate with the risks involved. Fair value estimation techniques normally incorporate assumptions that market participants would use in their estimates of values, future revenues, and future expenses, including assumptions about interest rates, default, prepayment and volatility. Because assumptions are inherently subjective in nature, the estimated fair values cannot be substantiated by comparison to independent market quotes and, in many cases, the estimated fair values would not necessarily be realized in an immediate sale or settlement of the instrument.

For cash and other liquid assets, the fair value is assumed to approximate to book value, given the short- term nature of these instruments. For those items with a stated maturity exceeding twelve months, fair value is calculated using a discounted cash flow methodology.

The financial instruments carried at fair value were categorized under the three levels of the Ind AS fair value hierarchy as follows:

Level 1: Quoted market prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. This level of the fair value hierarchy provides the most reliable evidence of fair value and is used to measure fair value whenever available.

Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: Inputs for the asset or liability that is not based on observable market data (unobservable inputs). These inputs reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). These inputs are developed based on the best information available in the circumstances, which include the Company’s own data. The Company’s own data used to develop unobservable inputs is adjusted if information indicates that market participants would use different assumptions.

27.20 Financial instruments

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

Financial assets

Initial recognition and measurement

All financial assets are recognized initially at fair value. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognized on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Subsequent measurement

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

• Debt instruments at amortized cost

• Debt instruments at fair value through other comprehensive income (FVTOCI)

• Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)

• Equity instruments measured at fair value through other comprehensive income (FVTOCI)

Derecognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retain substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

Impairment of financial asset

Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the following financial assets and credit risk exposure:

• Financial assets that are debt instruments, and are measured at amortized cost e.g., loans, debt securities, deposits, trade receivables and bank balance.

• Financial assets that are debt instruments and are measured as at FVTOCI.

• Lease receivables.

• Trade receivables or any contractual right to receive cash or another financial asset that result from transactions that are within the scope of Ind AS 115.

• Loan commitments which are not measured as at FVTPL.

• Financial guarantee contracts which are not measured as at FVTPL.

The Company follows ‘simplified approach’ for recognition of impairment loss allowance on:

• Trade receivables or contract revenue receivables; and

• All lease receivables resulting from transactions within the scope of Ind AS 116

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. For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used.

Financial liabilities

Initial recognition and measurement

The Company initially recognizes loans and advances, deposits, debt securities issued and subordinated liabilities on the date on which they are originated. All other financial instruments (including regular-way purchases and sales of financial assets) are recognized on the trade date, which is the date on which the Company becomes a party to the contractual provisions of the instrument.

A financial asset or financial liability is measured initially at fair value, for an item not at fair value through profit or loss, transaction costs that are directly attributable to its acquisition or issue.

Derecognition

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

27.21 Earnings per share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period as reduced by number of shares bought back, if any. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue, bonus element in a rights issue, share split, and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net 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.

27.22 Borrowings

Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the facility to which it relates

Preference shares, which are mandatorily redeemable on a specific date, are classified as liabilities. The dividends on these preference shares are recognized in profit or loss as finance costs

Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss as other gains/ (losses).

Borrowings are classified as current liabilities unless they have an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date, the entity does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.

27.23 Government grants

Government grants are recognized where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. When the grant relates to an expense item, it is recognized as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. When the grant relates to an asset, it is recognized as income in equal amounts over the expected useful life of the related asset

The fair value of financial assets and liabilities are included at the amount at which the instrument that would be received to sell an asset or paid to transfer in an orderly transaction between market participants at the measurement date.

The carrying amounts of financial assets and liabilities measured at amortised cost are a reasonable approximation of their fair values.

Fair value hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into three levels prescribed under the accounting standard. An explanation of each level is given in Note no 27.19 (Reference No) of Significant Accounting Policies.

35A Financial risk management policy and objectives

Company’s principal financial liabilities, comprises loans and borrowings, trade and other payables and other financial liabilities. The main purpose of these financial liabilities is to finance Company''s operations. Company’s principal financial assets include investments, trade and other receivables, security deposits, cash and cash equivalents and other bank balances that derive directly from its operations.

Company is exposed to certain risks which includes market risk, credit risk and liquidity risk.

Company''s senior management takes care of Company''s financial risk activities through appropriate policies and procedures. The policies for managing these risks are summarised below.

1) Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments. Company uses expected credit loss model for assessing and providing for credit risk.

a) Trade receivable

Customer credit risk is managed by the Company under the guidance of the credit policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on financial position, past performance, business/economic conditions, market reputation , expected business etc. Based on this evaluation, credit limit and credit terms are decided. Exposure on customer receivables are regularly monitored and managed through credit lock and release. For export customers, credit insurance is generally taken. An impairment analysis is performed at each reporting date on an individual basis for all the customers. The impairment is based on expected credit model considering the historical data and financial position of individual customer at each reporting period. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets. Trade receivables are non-interest bearing and are generally on, 40 days to 180 days credit term. The Company has low concentration of risk as customer base in widely distributed both economically and geographically.

b) Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company’s finance department in accordance with Company’s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Company monitors rating, credit spreads and financial strength of its counter parties. Based on ongoing assessment Company adjust it''s exposure to various counterparties. Company''s maximum exposure to credit risk for the components of statement of financial position is the carrying amount.

2) Liquidity risk

Liquidity risk is the risk that the Company may not be able to meet its present and future cash flow and collateral obligations without incurring unacceptable losses. Company''s objective is to, at all time maintain optimum levels of liquidity to meet its cash and collateral requirements. Company closely monitors its liquidity position. It maintains adequate sources of financing including overdraft, debt from domestic and international banks at optimized cost.

3) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk:- interest rate risk, currency risk and other price risk such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits, investments.

Company''s activities expose it to variety of financial risks, including effect of changes in foreign currency exchange rate and interest rate.

a) Interest rate risk

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

The Company has been availing the borrowings on variable rate of interest. The borrowings on a variable rate of interest are subject to interest rate risk as defined in Ind AS 107.

b) Foreign Currency Exposure Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure 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 assets & liabilities is denominated in a foreign currency).

43. Willful Defaulter

The Company has not been declared willful defaulter by any banks/Financial Institutions.

44. Crypto Currency or Virtual Currency

The Company has not traded or invested in Crypto Currency or Virtual Currency

45. Note on Undisclosed Income If any

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).

Also none of the previously unrecorded income and related assets have been recorded in the books of account during the year.

47. Disclosure related to reporting under rule 11(e) of the Companies (Audit and Auditors) Rules, 2014, as amended.

1) 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 any other person or entities, 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.

2) No funds have been received by the Company from any person or entity, 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.

48. Corporate Social Responsibility (CSR)

(a) CSR amount required to be spent by the Company as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof during the year is Rs. 14.46 Lakhs (Previous Year Rs. 9.68).

(b) Expenditure related to Corporate Social Responsibility is Rs.14.74 Lakhs (Previous Year Rs. 6.52).

Details of Amount spent towards CSR is given below:

As per our report of even date

For and On behalf of Board of Directors

For P G BHAGWAT LLP Dilip Kulkarni Prakash Kulkarni

Chartered Accountant Managing Director Executive Chairman

FRN: 101118W/W100682 DIN: 00184727 DIN: 00052342

Mr.Akshay B. Kotkar Suhas Kharote Ms. Aishwarya Toraskar

Partner Chief Finance Officer Company Secretary

M.No.: 140581 M. No.: A54931

Place : Kolhapur Place : Shirol

Date : 06^th May, 2024 Date : 06^th May, 2024

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Mar 31, 2015

1. General Information about KPT

Kulkarni Power Tools Ltd. [KPT], is a Public Limited Company incorporated on 30th July,1976, under the provisions of Companies Act,1956. Its shares are listed at Bombay Stock Exchange. The Company is mainly engaged in the business of Electric Power Tools and Roots (Positive Displacement) Blowers / Exhausters for a wide variety of applications.

2. Basis of Preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 2013. The financial statements have been prepared on an accrual basis and under the historical cost convention except free hold land which was revalued during the financial year 2003-04.

The estimates of future salary increase, considered in actuarial valuation, taking into account of inflation, seniority, relevant factors, such as supply and demand in the employment market.

Brief description of the nature of the obligation and the expected timing of any resulting outflows of economic benefits.

Product Warranty:

Accruals have been made in respect of warranties given by the Company for the sales made during the year based on past experience.

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Mar 31, 2014

1 General Information about KPT

Kulkarni Power Tools Ltd., [KPT] is a Public Limited Company incorporated on 30th July 1976 under the provisions of Companies Act, 1956. Its shares are listed at Bombay Stock Exchange. The Company is mainly engaged in the business of Electric Power Tools and Roots ( Positive Displacement) Blowers / Exhausters for a wide variety of applications.

2 Basis of Preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies ( Accounting Standards ) Rules, 2006 ( as amended ) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention except free hold land which was revalued during the financial year 2003-04.

In Rs. 2014 2013

3 Contingent Liabilities and Commitments (To The Extent Not Provided For)

A) Contingent Liabilites

Sales Tax 2,325,562 233,690

Central Excise 17,405,558 459,569

19,731,120 693,259

Signifcant Accounting Policies relating to Segment Reporting

a. Business Segments are determined on the basis of the goods manufactured and in accordance with Accounting Standard 17.

b. Segment report is prepared in conformity with accounting policies adopted for preparing and presenting financial statements.

Brief description of the nature of the obligation and the expected timing of any resulting outflows of economic benefits.

Product Warranty :

Accruals have been made in respect of warranties given by the Company for the sales made during the year based on past experience.

4 Previous year''s figures have been regrouped wherever necessary.

5 Figures in the brackets pertain to previous year.

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Mar 31, 2013

1 General Information about KPT

Kulkarni Power Tools Ltd., [KPT] is a Public Limited Company incorporated on 30th July,1976, under the provisions of Companies Act, 1956. Its shares are listed on the Bombay Stock Exchange. The Company is engaged in manufacturing of Electric Power Tools and Twin Lobe Blowers for a wide variety of applications. KPT exports its products to United Kingdom, Middle East, East Africa, Nigeria and South Africa, South East Asia and SAARC countries.

2 Basis of Preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies ( Accounting Standards ) Rules, 2006 ( as amended ) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention except free hold land which was revalued during the financial year 2003-04.

In Rs.

2013 2012

3 Contingent Liabilities and Commitments (To The Extent Not Provided For)

A) Contingent Liabilities

Sales Tax 233,690 57,282

Central Excise 459,569 -

693,259 57,282

4 Previous year''s figures have been regrouped wherever necessary.

5 Figures in the brackets pertain to previous year.

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Mar 31, 2012

(a) Rights of equity shareholders

The Company has only one class of equity shares, having par value of Rs. 5/- per share. Each holder of equity share is entitled for one vote per share and has a right to receive dividend as recommended by the Board of Directors, subject to the necessary approval from the shareholders. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

In Rs.

2012 2011

1 Contingent Liabilities and Commitments

(To The Extent Not Provided For)

A) Contingent Liabilities

Income Tax - 42,488

Sales Tax 57,282 157,282

B) Commitments

a) Estimated amount of contracts remaining to be executed on 3,468,955 17,499,862 capital account and not provided for

b) Other Commitments :

i) Please refer Note No.43 for Lease commitments. 6,456,368 5,518,480

ii) The Company has obtained sales tax payment deferral benefit under Package Scheme of Incentive 1988 and 1993 scheme. The Company is obliged to comply the conditions specified under the said scheme. The outstanding balance payable under the said scheme is - 64,787,477 66,234,949

2 Based on available information, presently, there are no amounts payable to parties covered under the Micro, Small and Medium Enterprises Development Act, 2006.

3 Leased Assets:

Disclosure as per Accounting Standard - 19 on Leases as per Companies Accounting Standard Rules.

a) i) The Company has taken certain premises on operating lease. The Agreements entered into provide for renewal and rent escalation clause.

b) i) The Company has given Land and Building under operating lease.

ii) Particulars of future minimum lease payments in respect of the same are as mentioned below:

Brief description of the nature of the obligation and the expected timing of any resulting outflows of economic benefits.

Product Warranty:

Accruals have been made in respect of warranties given by the Company for the sales made during the year based on past experience.

4 Previous year Figures

Till the year ended 31st March 2011, the Company was using pre-revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31st March, 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the Company. The Company has reclassified previous year figures to conform to this year's classification.

5 Figures in the brackets pertain to previous year.

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Mar 31, 2011

In Rs.

2011 2010

1. Contingent Liabilities not provided for

Sales Tax 157,282 157,282

Income Tax 42,488 42,488

Significant Accounting Policies relating to Segment Reporting

a. Business Segments are determined on the basis of the goods manufactured and in accordance with Accounting Standard 17.

b. Segment report is prepared in conformity with accounting policies adopted for preparing and presenting financial statements.

II. Defined Benefits Plan

Gratuity

Gratuity is payable to all eligible employee on retirement, death or termination in terms of provision of the Payment of Gratuity Act. The Company makes yearly contribution to a Gratuity Trust equal to premium of Group Gratuity Insurance with Life Insurance Corporation of India.

2. There are claims on the Company raised by an ex-dealer. The Company is advised that the claims are not tenable either on the facts or in law. The Company has not acknowledged them as debt and has already initiated legal action against the ex-dealer.

3. Leased Assets:

Disclosure as per Accounting Standard-19 on Leases as per Companies Accounting Standards Rules:

i) The Company has taken certain premises on operating lease. The Agreements entered into provide for renewal and rent escalation clause.

4. Based on available information, presently, there are no amounts payable to parties covered under the Micro, Small and Medium Enterprises Development Act, 2006.

5. Disclosure of Related Parties & Related Party Transactions :

Names of the related parties with whom transactions were carried out during the year and description of relationship :

1. Key Management Personnel (KMP) Designation

i. Shri Prakash A.Kulkarni Managing Director (M.D.)

ii. Shri Dilip B. Kulkarni Executive Director (E.D.)

2. Relatives of Key Management Personnel

Name of the transacting related party Nature of relationship

i. Late Smt. Malati A.Kulkarni Mother of M.D.

ii. Shri Ajit A. Kulkarni Brother of M.D.

iii. Shri Ashok A. Kulkarni Brother of M.D.

6. Figures of the previous year have been regrouped where necessary.

7. Figures in the brackets pertain to previous year.

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Mar 31, 2010

In Rs.

2010 2009

1. Contingent Liabilities not provided for

Sales Tax 157,282 157,282

Income Tax 42,488 --

2. Voluntary Retirement Scheme

Voluntary Retirement Scheme compensation Rs. 13,063,154 paid during 2006-07 has been treated as Deferred Revenue Expenditure to be written off over a period of four years. Amount written off during the year is Rs.3,483,513. (Previous year Rs.3,483,505).

Significant Accounting Policies relating to Segment Reporting

a. Business Segments are determined on the basis of the goods manufactured and in accordance with Accounting Standard 17.

b. Segment report is prepared in conformity with accounting policies adopted for preparing and presenting financial statements.

3. There are claims on the Company raised by an ex-dealer. The Company is advised that the claims are not tenable either on the facts or in law. The Company has not acknowledged them as debt and has already initiated legal action against the ex-dealer.

4. Leased Assets:

Disclosure as per Accounting Standard-19 on Leases issued by the Institute of Chartered Accountants of India:

i) The Company has taken certain premises on operating lease. The Agreements entered into provide for renewal clause and do not provide for escalation in rent (except in one case) and sub leasing.

5. Based on available information, presently, there are no amounts payable to parties covered under the Micro, Small and Medium Enterprises Development Act, 2006.

6. Disclosure of Related Parties & Related Party Transactions :

Names of the related parties with whom transactions were carried out during the year and description of relationship:

1. Key Management Personnel (KMP) Designation

i. Shri PrakashA.Kulkarni Managing Director (M.D.)

ii. Shri Ashok A.Kulkarni Ex-Joint Managing Director

(upto 24.06.2009) (Ex-Jt.M.D.)

iii. Shri Dilip B. Kulkami Whole Time Director (W.T.D.)

2. Relatives of Key Management Personnel

Name of the transacting related party Nature of relationship

i. Shri Sahil A.Kulkarni Son of Ex-Jt.M.D.

ii. Late Smt. Malati A.Kulkarni Mother of M.D. and Ex-Jt.M.D.

iii. Smt. Sunanda A.Kulkarni Wife of Ex-Jt.M.D.

iv. Shri Ajay A. Kulkarni Son of Ex-Jt.M.D.

v. Shri Ajit A. Kulkarni Brother of M.D. & Ex-Jt. M.D.

7. Figures of the previous year have been regrouped where necessary.

8. Figures in the brackets pertain to previous year.