Notes to Accounts of Uniparts India Ltd.

Mar 31, 2025

2.20) Provisions and Contingencies

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past
events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle
the obligation and a reliable estimate of the amount can be made.

Provisions are measured at the present value of management''s best estimate of the expenditure required to settle
the present obligation at the end of the reporting period. The discount rate to determine the present value is a pre¬
tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.
The increase in the provision due to the passage of time is recognised as interest expense.

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 that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

2.21) Derivative financial instruments and hedge accounting

Cash Flow Hedge:

Any derivative that is either not designated a hedge, or is so designated but is ineffective as per Ind AS 109, is
categorized as a financial instruments at fair value through profit or loss.

2.22) Dividend to equity holders of the Company

The Company recognises a liability to make cash or non-cash distributions to equity holders of the Company
when the distribution is authorised and the distribution is no longer at the discretion of the Company. As per the
Corporate laws in India, a distribution is authorised when it is approved by the shareholders. A corresponding
amount is recognised directly in other equity.

2.23) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision-maker.

2.24) Earnings Per Share

Earning per share is calculated by dividing the profit attributable to owners of the company by the weighted
average number of equity shares outstanding during the financial year.

For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity
shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects
of all dilutive potential equity shares.

2.2 Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of H10 per share. Each holder of equity shares is
entitled to one vote per share. The shareholders of equity shares of the Company are entitled to receive dividends
as and when declared by the Company and enjoy proportionate voting rights in case any resolution is put to vote.
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 amount, if any. The distribution will be in proportion to the
number of equity shares held by the shareholders.

13.1 Securities premium account is used to record the premium on issue of equity shares. The same is utilised in
accordance with the provisions of The Companies Act, 2013

13.2 The employees stock option outstanding account represents the fair value of stock options granted by the
Company over the vesting period. The reserve will be utilised on exercise of the options by the employees.

13.3 Retained earnings and General Reserve are to be utilised for General purpose.

14.1 Working capital loans

Above loan is secured against (i) First pari passu charge on all existing and future current assets and moveable fixed
assets, and (ii) Equitable mortgage by way of first pari passu charge over the land and building situated at B208,
A1&2, Phase II, Noida, UP.

Rate of Interest

* Interest @ 3.54% ~ 5.63% p.a.

14.2 The monthly returns/statements of current assets filed by the Company with banks or financial institutions in
relation to secured borrowings wherever applicable, are in agreement with the books of accounts and there are no
material differences required to be reported in respect of all the years referred above.

14.3 The quarterly returns/statements of current assets filed by the Company with banks or financial institutions in
relation to secured borrowings wherever applicable, are in agreement with the books of accounts and there are no
material differences required to be reported in respect of all the years referred above.

Disclosure as required by Ind AS 7 - "Cash Flow Statements" - change in liabilities arising from financing
activities:-

35 DISCLOSURE ON EMPLOYEE SHARE BASED PAYMENT

Disclosure is hereby given in pursuant to Ind AS 102 "Share Based Payment".

1) Uniparts India Limited- Employee Stock Option Scheme, 2023'' (“ESOS 2023"/"Scheme")

(a) Scheme detail

During the year ended 31^st March 2024, the company implemented Uniparts India Limited-Employee Stock Option
Scheme, 2023'' ("ESOS 2023"/"Scheme") which was approved by the shareholders of the company by way of special
resolution on January 9, 2024, authorizing the Nomination and Remuneration committee ("committee") to grant
equity share of the company not exceeding 9,02,675, equivalent to 2.00 % of the paid up equity share capital of the
company as on 9^th January 2024. further, the stock options to any single employee under the Scheme shall not
exceed 5,00,000 shares of the company during the tenure of the Scheme, subject to compliance with applicable
laws.

The options granted under Scheme have a maximum vesting period of 4 years. The eligibility of the employees
will be based on grade, criticality, skills, potential contribution, and such other criteria as may be determined by the
committee at its sole discretion, from time to time. Scheme shall be applicable to the company, its group company
including its subsidiary companies), and associate company within or outside India and any successor company
thereof to the extent any options have been granted to the employees of such entities, to the extent required under
the Applicable Law. The employees shall be entitled to receive one equity share of the company on exercise of each
stock option Subject to continuation of employment over the vesting period. The exercise price per option shall

be determined by the committee which shall be up to a maximum of 25% (twenty-five percent) discount to market
price of share as of the date of grant.

Explanation: market price for this purpose shall mean the latest available closing price of shares on the stock
exchange having higher trading volume on the date immediately preceding the date of grant, as per SEBI SBEB &
SE Regulations.

As per the Scheme, the Company has granted options 92,099 @ H329.70/- per option (Grant - 1), 52,286 options @
H433.90/- per option (Grant - 2), 17,055 options @ H325.43/- per option (Grant - 3) in accordance with the provisions
of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021,
to the selected employees of the Company and its group companies. The method of settlement is by issue of equity
shares to the selected employees who have accepted the option.

Period within which options will vest to the participants

Grant-1

1 years from the date of Grant of Options 33%

2 years from the date of Grant of Options 33%

3 years from the date of Grant of Options 34%

Grant-2 to Grant-3

1 years from the date of Grant of Options 33% (November 13, 2025)

2 years from the date of Grant of Options 33% (October 29, 2026)

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2) Uniparts Employees Stock Option Plan, 2007

(a) Scheme detail

The Company''s ESOP scheme "Uniparts Employees Stock Option Plan, 2007" is administered through an ESOP
Trust, which subscribes to shares of the Company and holds them until issuance thereof based on vesting and
exercise of options by employees. The scheme provides that subject to continued employment with the Company,
specified employees of the Company and its subsidiaries are granted an option to acquire equity shares of the
Company that may be exercised within a specified period.

As per the Scheme, the Company has granted 1,14,833 options @ H135/- per option (Grant - 1), 42,764 options @
H135/- per option (Grant - 2), 25,000 options @ H135/- per option (Grant - 3), 86,592 Right Issue @ H45/- per share,
28,912 options @ H105/- per option (Grant - 4), 26,209 options @ H105/- per option (Grant - 5), 28,825 options @
H105/- per option (Grant - 6), 11,255 options @ H105/- per option (Grant - 7), 5,000 options @ H105/- per option
(Grant - 8), 21,465 options @ H105/- per option (Grant - 9), 324,637 Bonus Issue @ H Nil per share, 35,102 options @
H52.50 per option (Grant - 10), 52,948 options @ H52.50 per option (Grant - 11), 292,500 options @ H52.50 per option
(Grant - 12), 25,000 options @ H52.50 per option (Grant - 13), 102,948 options @ H52.50 per option (Grant - 14), 67,412
options @ H52.50 per option (Grant - 15), 2,500 options @ H52.50 per option (Grant - 16) and 46,792 options @ H52.50
per option (Grant - 17) in accordance with the provisions of the Securities and Exchange Board of India (Share
Based Employee Benefits) Regulations, 2014, to the selected employees of the Company. The method of settlement
is by issue of equity shares to the selected employees who have accepted the option.

Period within which options will vest to the participants

Grant-1 to Grant-10 and Grant-12, Grant-13, Grant- 15 and Grant- 16

2 years from the date of Grant of Options 33%

3 years from the date of Grant of Options 33%

4 years from the date of Grant of Options 34%

Grant-11 & Grant-14

12 months from the date of Grant of Options 100%

Grant-17

1 years from the date of Grant of Options 33%

2 years from the date of Grant of Options 33%

3 years from the date of Grant of Options 34%

37 DETAILS OF DUES TO MICRO AND SMALL ENTERPRISES AS DEFINED UNDER MICRO,
SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006 (MSMED, ACT 2006)

The Ministry of Corporate Affairs has issued notification no.G.S.R 1022(E) dated October 11, 2018 which prescribes
certain disclosures regarding amount payable to micro enterprises and small enterprises. Accordingly, the disclosure in
respect of the amounts payable to such enterprises has been made in the financial statements based on the information
received from the vendors. The necessary information in this regard has been given hereunder :-

39 GOVERNMENT GRANT

Uniparts India Limited has availed tax and duty benefit in the nature of exemption from payment of Customs Duty,
on its procurements with respect to Plant and Machinery. The said benefits were availed which entitled Uniparts India
Limited to procure goods without payment of taxes and duties of amount for H3.55 million under Zero Duty EPCG
Scheme.

In accordance with Ind AS 20 ""Accounting for Government Grants and Disclosure of Government Assistance"" Uniparts
India Limited has grossed up the value of property, plant and equipment by the amount of tax and duty benefit availed
considering the same as government grant. The amount of said government grant has been added to the value of
property, plant and equipment with corresponding credit to deferred government grant, the amount of grant shall be
amortized on a systematic basis in line with depreciation to be charged on property, plant and equipment.

(B) Enterprises over which Key Managerial Personnel and their relatives exercise significant influence:

SKG Engineering Pvt. Ltd.

SGA Trading Pvt. Ltd.

Tima Trading LLP (Formerely known as Tima Trading Pvt. Ltd.)

Amazing Estates Pvt. Ltd.

GKP Farm LLP (Formerly known as G.K.P. Farms Pvt. Ltd.)

Silveroak Estate LLP (Formerely known as Silveroak Estate Pvt Ltd.)

Bluebells Homes Pvt. Ltd. (Formerly known as Oilintec Pvt. Ltd.)

Sepoy Drinks Pvt Ltd

Charisma Homes LLP (Formerly known as Charisma Homes Pvt. Ltd.)

Avid Star LLP (Formerly known as Avid Maintenance LLP)

Sepoy Beverages LLP

Gripwel Fasteners (Partnership Firm)

Farmparts Company (Partnership Firm)

Soni Holdings (Partnership Firm)

Indento International (Partnership Firm)

P Soni Family Trust
Soni Foundation
Paramjit Singh (HUF)

Gurdeep Soni (HUF)

Leon India (Partnership Firm)

Paper Bag Entertainment Inc.

The Karan Soni 2018 CG-NG Nevada Trust

The Meher Soni 2018 CG-NG Nevada Trust

The Paramjit Soni 2018 CG-NG Nevada Trust

Gifting Trust of Karan Soni

Gifting Trust of Meher Soni

Paramjit Soni Gifting Trust

Sarabjit Soni Gifting Trust

Uniparts ESOP Trust

7 Days Film LLC

(C) Key Managerial Personnel / Individuals having significant influence on the Company:

Gurdeep Soni-Chairman & Managing Director
Paramjit Singh Soni- Vice Chairman & Executive Director
Herbert Klaus Coenen - Non-Executive Director
Rohit Maheshwari-Chief Financial Officer

Tanushree Bagrodia- Group Chief Operating Officer cum Whole time director (w.e.f : 25^th November 2024)
Sudhakar Simhachala Kolli - Group Chief Operating Officer (till: 31^st January 2025)

Jatin Mahajan (Company Secretary)

(D) Relatives of Key Managerial Personnel *

Angad Soni - Son of Gurdeep Soni
Pamela Soni - Wife of Gurdeep Soni
Arjun Soni - Son of Gurdeep Soni
Tanya Kohli- Daughter of Gurdeep Soni

*Relatives of Key Managerial Personnel with whom transactions have taken place during the year

^A ihe variation in Debt service coverage ratio and Debt equity ratio as at March 31, 2025 as compared to March 31, 2024
is primarily due to increases in current borrowing.

# Variation in Trade payable, Capital turnover and Capital employed ratios is primarily due to decreases in turnover and
profitabilty during the year ended March 31, 2025.

42 HEDGING ACTIVITIES AND DERIVATIVES

The Company uses foreign currency denominated borrowings and foreign exchange forward contracts for the purpose
of hedging its currency risks. These contracts are not intended for trading or speculation. The foreign exchange forward
contracts are designated as cash flow hedges.

Cash flow hedges

Foreign exchange forward contracts measured at fair value through OCI are designated as hedging instruments in cash
flow hedges of forecast sales in US dollar. These forecast transactions are highly probable.

While the Company also enters into other foreign exchange forward contracts with the intention to reduce the foreign
exchange risk of expected sales and purchases, these other contracts are not designated in hedge relationships and are
measured at fair value through profit or loss

The foreign exchange forward contract balances vary with the level of expected foreign currency sales and purchases
and changes in foreign exchange forward rates.

The terms of the foreign currency forward contracts match the terms of the expected highly probable forecast
transactions. As a result, no hedge ineffectiveness arise requiring recognition through profit or loss. Notional amounts

of outstanding forward contracts are as follows _:

The cash flow hedges of the expected future sales during the year ended March 31, 2025 were assessed to be effective and
a unrealised gain/(loss) of (H13.75 million), with a deferred tax assets of H3.46 million relating to the hedging instruments
is included in OCI. Comparatively, the cash flow hedges of the expected future sales during the year ended March 31,
2024 were assessed to be highly effective and a unrealised gain/(loss) of H25.35 million, with a deferred tax liability of
H6.38 million was included in OCI in respect of these contracts.

The amount removed from OCI during the year and recognised in the statement of profit & loss for the year ended
March 31, 2025 is detailed in Note 31 totaling H18.97 million (net of tax) [March 31, 2024: 25.13 million (net of tax)]. The
amounts retained in OCI at March 31, 2025 are expected to mature and affect the statement of profit and loss in the
subsequent years.

Reclassifications to profit or loss during the year gains or losses included in OCI are shown in Note 31.

43 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company''s principal financial liabilities other than derivatives, comprise loans and borrowings, trade payables,
employee related payables and other payables. The main purpose of these financial liabilities is to finance the Company''s
operations. The Company''s principal financial assets include loan to employees, trade receivables & other receivables
and cash and cash equivalents that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company''s senior management oversees
the management of these risks. The Company''s senior management is supported by a Audit committee that advises
on financial risks and the appropriate financial risk governance framework for the Company. The Audit committee
provides assurance that the Company''s financial risk activities are governed by appropriate policies and procedures
and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk
objectives. All derivative activities for risk management purposes are carried out by experienced members from the
senior management who have the relevant expertise, appropriate skills and supervision. It is the Company''s policy
that no trading in derivatives for speculative purposes may be undertaken. The Board of Directors reviews and agrees
policies for managing each of these risks, which are summarised as below.

a) 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 prices are subject to commodity price risk, foreign exchange risk and interest rate
risk.

The financial instruments that are affected by these include loans and borrowing, deposits, available-for-sale
investments and derivative financial instruments. We, from time to time, undertake analysis in relation to the
amount of our net debt, the ratio of fixed to floating interest rates of our debt and our financial instruments that are
in foreign currencies. We use derivative financial instruments such as foreign exchange contracts to manage our
exposures to foreign exchange fluctuations.

b) 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''s exposure to the risk of changes in market interest rates relates
primarily to the Company''s long-term debt obligations with floating interest rates. The interest rate on remaining
loans (except vehicle loans), although fixed, is subject to periodic review by lending banks / financial institutions in
relation to their respective base lending rates, which may vary over a period result of any change in the monetary
policy of the Reserve Bank of India.

d) Commodity price risk

Commodity price risk is the possibility of impact from changes in the prices of raw materials such as steel, which
we use in the manufacture of our products. While we seek to pass on input cost increases to our customers, we may
not be able to fully achieve this in all situations or at all times.

Commodity price sensitivity

As the Company has a back to back pass through arrangements for volatility in raw material prices there is no
impact on the profit and loss and equity of the Company.

e) 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, investment
in mutual funds, other receivables and deposits, foreign exchange transactions and other financial instruments.

In relation to credit risk arising from financing activities, we monitor our credit spreads and financial strength on
a regular basis, and based on our on-going assessment of counterparty risk, we adjust our exposure to various
counterparties.

f) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with
its financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to
managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they
are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to
the Company''s reputation and ongoing business.

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing
facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of
financial assets and liabilities.

The management assessed that the fair value of cash and cash equivalent, trade receivables, derivative instruments,
trade payables and other current financial assets and liabilities approximate their carrying amounts largely due to the
short term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged
in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and
assumptions were used to estimate the fair values: .

(i) Long-term fixed-rate and variable-rate receivables are evaluated by the Company based on parameters such as
individual creditworthiness of the customer. Based on this evaluation, allowances are taken into account for the
expected credit losses of these receivables.

(ii) The fair value of other non-current financial liabilities and security deposits, is estimated by discounting future
cash flows using 10 year government bond rates. In addition to being sensitive to a reasonably possible change in
the forecast cash flows or the discount rate, the fair value of the equity instruments is also sensitive to a reasonably
possible change in the growth rates.

(iii) Further the management assessed that the fair value of loan to employees approximate their carrying amounts
largely due to discounting at rates which are an approximation of current lending rates.

(iv) The Company enters into derivative financial instruments with various counterparties, principally financial
institutions with investment grade credit ratings. Foreign exchange forward contracts are valued using valuation
techniques, which employs the use of market observable inputs. The most frequently applied valuation techniques
include forward pricing using present value calculations. The models incorporate various inputs including the
credit quality of counterparties, foreign exchange spot and forward rates, yield curves of the respective currencies,
currency basis spreads between the respective currencies and forward rate curves of the underlying. All derivative
contracts are fully cash collateralised, thereby eliminating both counterparty and the Company''s own non¬
performance risk. As at March 31, 2025 the marked-to-market value of derivative asset positions is net of a credit
valuation adjustment attributable to derivative counterparty default risk. The changes in counterparty credit risk
had no material effect on the hedge effectiveness assessment for derivatives designated in hedge relationships and
other financial instruments recognised at fair value.

Reconciliation of fair value measurement of financial assets classified as FVTOCI:

46 Other Disclosure

(i) There were no transaction which have not been 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)

(ii) There was no Immovable Property during the year (other than properties where the Company is the lessee and the
lease agreements duly executed in favour of the lessee) whose title deeds are not held in name of the Company.

(iii) There were no proceedings initiated or pending against the Company for holding any Benami property under the
Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

(iv) There were no transactions and / or outstanding balances with struck off Companies under section 248 of the
Companies Act 2013 or section 560 of the Companies Act 1956.

(v) The Company does not have any charge which is yet to be registered with the Registrar of Companies beyond the
statutory period.

(vi) The Company has invested funds in subsidiaries directly or through its wholly owned subsidiaries. The Company
has complied with the number of layers prescribed under section 2 (87) of the Companies Act, 2013 read with the
Companies (Restriction on number of Layers) Rules, 2017.

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

(viii) During the year ended March 31, 2025, the Company was not a party to any approved scheme which needs approval
from a competent authority in terms of Sections 230 to 237 of the Companies Act, 2013.

(ix) The Company has not been declared a wilful defaulter by any bank or financial institution or government or any
government authority.

47 Previous Year figures have been re-grouped/ re-arranged/ re-classified wherever necessary to correspond with the
current year''s classification/ disclosure.

As per our report of even date attached. For and on behalf of Board of Directors of

For S.C. VARMA AND CO. Uniparts India Limited

Chartered Accountants

Firm Registration No.000533N

S.C. Varma Gurdeep Soni Tanushree Bagrodia

Partner, (Chairman & Managing Director) (Whole time Director)

Membership No.011450 [DIN: 00011478] [DIN: 06965596]

Rohit Maheshwari Jatin Mahajan

Place : New Delhi (Chief Financial Officer) (Company Secretary)

Date : 27^th May 2025 [FCA: 093127] [FCS: 6887]

---

Mar 31, 2024

2.20) Provisions and Contingencies

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount can be made.

Provisions are measured at the present value of management''s best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate to determine the present value is a pretax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense.

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 that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made."

2.21) Derivative financial instruments and hedge accounting

Cash Flow Hedge:

The Company enters into derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures.

The effective portion of changes in the fair value of the hedging instruments is recognized in other comprehensive income and accumulated in the cash flow hedging reserve. Such amounts are reclassified in to the statement of profit or loss when the related hedge items affect profit or loss. Any ineffective portion of changes in the fair value of the derivative or if the hedging instrument no longer meets the criteria for hedge accounting, is recognized immediately in the statement of profit and loss.

Any derivative that is either not designated a hedge, or is so designated but is ineffective as per Ind AS 109, is categorized as a financial instruments at fair value through profit or loss.

2.22) Dividend to equity holders of the Company

The Company recognises a liability to make cash or non-cash distributions to equity holders of the Company when the distribution is authorised and the distribution is no longer at the discretion of the Company. As per the Corporate laws in India, a distribution is authorised when it is approved by the shareholders. A corresponding amount is recognised directly in other equity.

2.23) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker.

2.24) Earnings Per Share

Earning per share is calculated by dividing the profit attributable to owners of the company by the weighted average number of equity shares outstanding during the financial year.

For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

12.2 Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of H 10 per share. Each holder of equity shares is entitled to one vote per share. The shareholders of equity shares of the Company are entitled to receive dividends as and when declared by the Company and enjoy proportionate voting rights in case any resolution is put to vote. 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 amount, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

14.1 Working capital loans

Above loan is secured against (i) First pari passu charge on all existing and future current assets and moveable fixed assets, and (ii) Equitable mortgage by way of first pari passu charge over the land and building situated at B208, A1&2, Phase II, Noida, UP.

Rate of Interest

# Ranges from 5.57% ~ 5.97%

14.2 The monthly returns/statements of current assets filed by the Company with banks or financial institutions in relation to secured borrowings wherever applicable, are in agreement with the books of accounts and there are no material differences required to be reported in respect of all the years referred above.

30 EARNINGS PER EQUITY SHARE OF FACE VALUE OF H 10 EACH

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity share holders of the parent by the weighted average number of equity shares outstanding during the year.

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

35 DISCLOSURE ON EMPLOYEE SHARE BASED PAYMENT

Disclosure is hereby given in pursuant to Ind AS 102 "Share Based Payment".

(a) Scheme detail:

The Company''s ESOP scheme "Uniparts Employees Stock Option Plan, 2007" is administered through an ESOP Trust, which subscribes to shares of the Company and holds them until issuance thereof based on vesting and exercise of options by employees. The scheme provides that subject to continued employment with the Company, specified employees of the Company and its subsidiaries are granted an option to acquire equity shares of the Company that may be exercised within a specified period. Each option comprises of one equity share which will vest on annual basis in equal proportion over a period of three years (except Grant-11 and Grant-14 which shall vest 100% on the expiry of 12 months from the grant date) and shall be capable of being exercised within a period of fifteen years from the date of the specified grant. Each option granted under the above plan entitles the holder to one equity share of the Company at an exercise price, which is approved by the Nomination and Remuneration Committee. The Company has provided an interest free loan amounting to H55.20 million to the Trust to subscribe to 350400 Shares issued at H135 per share and right issue of 175200 Shares at H45 per share. The ESOP Trust has since subscribed to the Company''s shares. As per IND AS 102 "Share-based Payment" and the Guidance Note on Accounting for Employee Share Based payments issued by the Institute of Chartered Accountants of India, the amount of loan equivalent to the face value of securities subscribed H5.14 million has been deducted from share capital account and the balance part of the loan representing the amount of share premium paid for the shares subscribed H50.06 million has been deducted from the share premium account. The balance of such loan as at March 31, 2024 is H Nil.

As per the Scheme, the Company has granted 1,14,833 options @ H135/- per option (Grant - 1), 42,764 options @ H135/- per option (Grant - 2), 25,000 options @ H135/- per option (Grant - 3), 86,592 Right Issue @ H45/- per share, 28,912 options @ H105/- per option (Grant - 4), 26,209 options @ H105/- per option (Grant - 5), 28,825 options @ H105/- per option (Grant - 6), 11,255 options @ H105/- per option (Grant - 7), 5,000 options @ H105/- per option (Grant - 8), 21,465 options @ H105/- per option (Grant - 9), 324,637 Bonus Issue @ HNil per share, 35,102 options @ H52.50 per option (Grant - 10), 52,948 options @ H52.50 per option (Grant - 11), 292,500 options @ H52.50 per option (Grant - 12), 25,000 options @ H52.50 per option (Grant - 13), 102,948 options @ H52.50 per option (Grant - 14), 67,412 options @ H52.50 per option (Grant - 15) and 2,500 options @ H52.50 per option (Grant - 16) in accordance with the provisions of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, to the selected employees of the Company. The method of settlement is by issue of equity shares to the selected employees who have accepted the option.

38 CSR EXPENDITURE

As per Section 135 of the Companies Act, 2013, a corporate social responsibility (CSR) committee has been formed by the Company. The Company has spent the funds allocated for CSR activities primarily on promoting health aid program, education program, community developments projects which are specified in Schedule VII of the Companies Act, 2013 as follows:

39 GOVERNMENT GRANT

Uniparts India Limited has availed tax and duty benefit in the nature of exemption from payment of Customs Duty, on its procurements with respect to Plant and Machinery. The said benefits were availed which entitled Uniparts India Limited to procure goods without payment of taxes and duties of amount for INR 3.15 million under Zero Duty EPCG Scheme.

In accordance with Ind AS 20 ""Accounting for Government Grants and Disclosure of Government Assistance"" Uniparts India Limited has grossed up the value of property, plant and equipment by the amount of tax and duty benefit availed considering the same as government grant. The amount of said government grant has been added to the value of property, plant and equipment with corresponding credit to deferred government grant, the amount of grant shall be amortized on a systematic basis in line with depreciation to be charged on property, plant and equipment.

42 HEDGING ACTIVITIES AND DERIVATIVES

The Company uses foreign currency denominated borrowings and foreign exchange forward contracts for the purpose of hedging its currency risks. These contracts are not intended for trading or speculation. The foreign exchange forward contracts are designated as cash flow hedges.

Cash flow hedges

Foreign exchange forward contracts measured at fair value through OCI are designated as hedging instruments in cash flow hedges of forecast sales in US dollar. These forecast transactions are highly probable.

While the Company also enters into other foreign exchange forward contracts with the intention to reduce the foreign exchange risk of expected sales and purchases, these other contracts are not designated in hedge relationships and are measured at fair value through profit or loss

The foreign exchange forward contract balances vary with the level of expected foreign currency sales and purchases and changes in foreign exchange forward rates.

The terms of the foreign currency forward contracts match the terms of the expected highly probable forecast transactions. As a result, no hedge ineffectiveness arise requiring recognition through profit or loss. Notional amounts of outstanding forward contracts are as follows :

The cash flow hedges of the expected future sales during the year ended March 31, 2024 were assessed to be effective and a unrealised gain/(loss) of H25.35 million, with a deferred tax liability of H6.38 million relating to the hedging instruments is included in OCI. Comparatively, the cash flow hedges of the expected future sales during the year ended March 31, 2023 were assessed to be highly effective and a unrealised gain/(loss) of (H33.58 million), with a deferred tax asset of H8.45 million was included in OCI in respect of these contracts.

The amount removed from OCI during the year and recognised in the statement of profit & loss for the year ended March 31, 2024 is detailed in Note 31 totaling H25.13 million (net of tax) [March 31, 2023: 6.00 million (net of tax)]. The amounts retained in OCI at March 31, 2024 are expected to mature and affect the statement of profit and loss in the subsequent years.

Reclassifications to profit or loss during the year gains or losses included in OCI are shown in Note 31.

43 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company''s principal financial liabilities other than derivatives, comprise loans and borrowings, trade payables, employee related payables and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal financial assets include loan to employees, trade receivables & other receivables and cash and cash equivalents that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company''s senior management oversees the management of these risks. The Company''s senior management is supported by a Audit committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The Audit committee provides assurance that the Company''s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. All derivative activities for risk management purposes are carried out by experienced members from the senior management who have the relevant expertise, appropriate skills and supervision. It is the Company''s policy that no trading in derivatives for speculative purposes may be undertaken. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised as below.

a) 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 prices are subject to commodity price risk, foreign exchange risk and interest rate risk.

The financial instruments that are affected by these include loans and borrowing, deposits, available-for-sale investments and derivative financial instruments. We, from time to time, undertake analysis in relation to the amount of our net debt, the ratio of fixed to floating interest rates of our debt and our financial instruments that are in foreign currencies. We use derivative financial instruments such as foreign exchange contracts to manage our exposures to foreign exchange fluctuations.

b) 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''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates. The interest rate on remaining loans (except vehicle loans), although fixed, is subject to periodic review by lending banks / financial institutions in relation to their respective base lending rates, which may vary over a period result of any change in the monetary policy of the Reserve Bank of India.

c) Foreign currency 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 export revenue and long term foreign currency borrowings.

The Company have long term agreements with its major customers, the company face foreign exchange risk in respect of (I) our foreign currency loans, in respect of which selectively hedge currency exchange rate risk, (ii) currency mismatches between income and expenditures, which the company seek to manage as much as possible by matching income currency to expenditure currency, and (iii) currency translation for the purpose of preparing consolidated financial statements, on account of global operations.

d) Commodity price risk

Commodity price risk is the possibility of impact from changes in the prices of raw materials such as steel, which we use in the manufacture of our products. While we seek to pass on input cost increases to our customers, we may not be able to fully achieve this in all situations or at all times.

Commodity price sensitivity

As the Company has a back to back pass through arrangements for volatility in raw material prices there is no impact on the profit and loss and equity of the Company.

e) 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, investment in mutual funds, other receivables and deposits, foreign exchange transactions and other financial instruments.

In relation to credit risk arising from financing activities, we monitor our credit spreads and financial strength on a regular basis, and based on our on-going assessment of counterparty risk, we adjust our exposure to various counterparties.

f) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company''s reputation.

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The management assessed that the fair value of cash and cash equivalent, trade receivables, derivative instruments, trade payables and other current financial assets and liabilities approximate their carrying amounts largely due to the short term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values: .

(i) Long-term fixed-rate and variable-rate receivables are evaluated by the Company based on parameters such as individual creditworthiness of the customer. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

(ii) The fair value of other non-current financial liabilities and security deposits, is estimated by discounting future cash flows using 10 year government bond rates. In addition to being sensitive to a reasonably possible change in the forecast cash flows or the discount rate, the fair value of the equity instruments is also sensitive to a reasonably possible change in the growth rates.

(iii) Further the management assessed that the fair value of loan to employees approximate their carrying amounts largely due to discounting at rates which are an approximation of current lending rates.

(iv) The Company enters into derivative financial instruments with various counterparties, principally financial institutions with investment grade credit ratings. Foreign exchange forward contracts are valued using valuation techniques, which employs the use of market observable inputs. The most frequently applied valuation techniques

include forward pricing using present value calculations. The models incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates, yield curves of the respective currencies, currency basis spreads between the respective currencies and forward rate curves of the underlying. All derivative contracts are fully cash collateralised, thereby eliminating both counterparty and the Company''s own nonperformance risk. As at March 31, 2024 the marked-to-market value of derivative asset positions is net of a credit valuation adjustment attributable to derivative counterparty default risk. The changes in counterparty credit risk had no material effect on the hedge effectiveness assessment for derivatives designated in hedge relationships and other financial instruments recognised at fair value.

45 Capital management

The capital includes issued equity capital and other equity reserves attributable to the equity holders of the company. The primary objective of the company''s capital management is to maintain optimum capital structure to reduce cost of capital and to maximize the shareholder value. The company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants which otherwise would permit the banks to immediately call loans and borrowings.In order to maintain or adjust the capital structure, the company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares.

46 Other Disclosure

(i) There were no transaction which have not been 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)

(ii) There was no Immovable Property during the year (other than properties where the Company is the lessee and the lease agreements duly executed in favour of the lessee) whose title deeds are not held in name of the Company.

(iii) There were no proceedings initiated or pending against the Company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

(iv) There were no transactions and / or outstanding balances with struck off Companies under section 248 of the Companies Act 2013 or section 560 of the Companies Act 1956.

(v) The Company does not have any charge which is yet to be registered with the Registrar of Companies beyond the statutory period.

(vi) The Company has invested funds in subsidiaries directly or through its wholly owned subsidiaries. The Company has complied with the number of layers prescribed under section 2 (87) of the Companies Act, 2013 read with the Companies (Restriction on number of Layers) Rules, 2017.

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

(viii) During the year ended March 31, 2024, the Company was not a party to any approved scheme which needs approval from a competent authority in terms of Sections 230 to 237 of the Companies Act, 2013.

(ix) The Company has not been declared a wilful defaulter by any bank or financial institution or government or any government authority.

47 Previous Year figures have been re-grouped/ re-arranged/ re-classified wherever necessary to correspond with the current year''s classification/ disclosure.

As per our report of even date attached.

For S.C. VARMA AND C0. For and on behalf of the Board of Directors

Chartered Accountants Uniparts India Limited

Firm Regn. No.000533N

S.C. Varma Gurdeep Soni Sanjeev Kumar Chanana

Partner, Membership No.011450 (Chairman & Managing (Independent Director)

Director)

[DIN: 00011478] [DIN: 00112424]

Rohit Maheshwari Jatin Mahajan

Date : 28 May 2024 (Chief Financial Officer) (Company Secretary)

Place : New Delhi [FCA: 093127] [FCS: 6887]

---

Mar 31, 2023

Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of H10 per share. Each holder of equity shares is entitled to one vote per share. The shareholders of equity shares of the Company are entitled to receive dividends as and when declared by the Company and enjoy proportionate voting rights in case any resolution is put to vote. 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 amount, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

The Board of Directors of the Company at its meeting held on 25th May, 2023, has declared Second interim Dividend of H6.00/- per share on Equity Share of H10 each for the financial Year 2022-23. The same will be payable to those shareholders who hold the equity shares of the Company on the record date i.e. 07 June, 2023. This alongwith first interim dividend of H8.25/- per share, works out to a total dividend of H14.25/- per share for the year 2022-23.

13.1 Securities premium account is used to record the premium on issue of equity shares. The same is utilised in accordance with the provisions of The Companies Act, 2013

13.2 The employees stock option outstanding account represents the fair value of stock options granted by the Company over the vesting period. The reserve will be utilised on exercise of the options by the employees.

13.3 Retained earnings is to be utilised for General purpose.

14.1 Rupee Term Loans:

From Citibank N.A.

Balance outstanding Nil (For March 31, 2022 H33.33 million)

Above loan is secured against (i) exclusive charge on the moveable fixed assets funded from the term loan. (ii) plant and machinery and corporate guarantee of Gripwel Fasteners Pvt. Ltd.

Moratorium of 12 months from the date of drawdown and repayable in 48 equal monthly instalments along with fixed interest @ 5.25% ~ 6.25% p.a. on outstanding monthly balance.

14.2 Working capital loans

Above loan is secured against (i) First pari passu charge on all existing and future current assets and moveable fixed assets, and (ii) Equitable mortgage by way of first pari passu charge over the land and building situated at B208, A1&2, Phase II, Noida, UP.

Rate of Interest

# Ranges from LIBOR/SOFR 100 bps to 200 bps

14.3 The quarterly returns/statements of current assets filed by the Company with banks or financial institutions in relation to secured borrowings wherever applicable, are in agreement with the books of accounts and there are no material differences required to be reported in respect of all the years referred above.

30 EARNINGS PER EQUITY SHARE OF FACE VALUE OF H 10 EACH

Basic EPS amounts are calculated by dividing the profit for the period/year attributable to equity share holders of the parent by the weighted average number of equity shares outstanding during the period/year.

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

The following reflects the income and share data used in the basic and diluted EPS computations:

32 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR): (H in millions)
Particular	As at 31st March 2023	As at 31st March 2022
(i) Contingent liabilities:
(a) Claims against the company not acknowledged as debt:
Sales Tax Matters	2.33	2.33
Excise Matters	0.21	0.21
GST Matters	0.36	0.36
Labour Matters	Not Ascertainable	Not Ascertainable
(b) Income Tax Demands	130.10	46.61
(c) Others
a) Guarantees given on behalf of the company by the Banks:
Sales Tax Matters	0.03	0.03
Pollution Control Board	0.05	0.05
BSE Limited	5,360.00	-
Gas Connections	5.79	2.68
b) Other money for which the company is contingently liable:
Corporate Guarantee given to Banks against financial assistance to subsidiary	225.00	225.00
(ii) Capital Commitments
Estimated amount of contracts remaining to be executed on Capital Accounts and not provided for (Net of Advances)	31.59	11.08

Sensitivity analysis is an analysis which will give the movement in liability if the assumptions were not proved to be true on different count. This only signifies the change in the liability if the difference between assumed and the actual is not following the parameters of the sensitivity analysis.

Defined Benefit Plan - Leave Encashment (Unfunded)

The leave obligations cover the Company''s liability for sick and earned leaves. The Company does not have an unconditional right to defer settlement for the obligation shown as current provision balance above. However based on past experience, the Company does not expect all employees to take the full amount of accrued leave or require payment within the next 12 months, therefore based on the independent actuarial report, only a certain amount of provision has been presented as current and remaining as non-current. Amount for the period/year ended March 31, 2023 is H9.25 million and for the year ended March 31, 2022 is H10.72 million has been recognised in the statement of profit and loss.

35 DISCLOSURE ON EMPLOYEE SHARE BASED PAYMENT

Disclosure is hereby given in pursuant to Ind AS 102 "Share Based Payment".

(a) Scheme detail:

The Company''s ESOP scheme "Uniparts Employees Stock Option Plan, 2007" is administered through an ESOP Trust, which subscribes to shares of the Company and holds them until issuance thereof based on vesting and exercise of options by employees. The scheme provides that subject to continued employment with the Company, specified employees of the Company and its subsidiaries are granted an option to acquire equity shares of the Company that may be exercised within a specified period. Each option comprises of one equity share which will vest on annual basis in equal proportion over a period of three years (except Grant-11 and Grant-14 which shall vest 100% on the expiry of 12 months from the grant date) and shall be capable of being exercised within a period of fifteen years from the date of the specified grant. Each option granted under the above plan entitles the holder to one equity share of the Company at an exercise price, which is approved by the Nomination and Remuneration Committee. The Company has provided an interest free loan amounting to H55.20 million to the Trust to subscribe to 350400 Shares issued at H135 per share and right issue of 175200 Shares at H45 per share. The ESOP Trust has since subscribed to the Company''s shares. As per IND AS 102 "Share-based Payment" and the Guidance Note on Accounting for Employee Share Based payments issued by the Institute of Chartered Accountants of India, the amount of loan equivalent to the face value of securities subscribed H5.14 million has been deducted from share capital account and the balance part of the loan representing the amount of share premium paid for the shares subscribed H50.06 million has been deducted from the share premium account.

The balance of such loan as at March 31, 2023 is H32.13 million The repayment of loan is primarily dependent upon the exercise of options by the employees, the price at which fresh or reissued options are granted and dividend income earned thereon till exercise of options. The Company believes that the options would be exercised by the employees and the ESOP Trust would be able to repay the loan based on the price received by the Trust there against. On that basis, the loan to the ESOP Trust is considered good of recovery.

As per the Scheme, the Company has granted 1,14,833 options @ H135/- per option (Grant - 1), 42,764 options @ H135/- per option (Grant - 2), 25,000 options @ H135/- per option (Grant - 3), 86,592 Right Issue @ H45/- per share, 28,912 options @ H105/- per option (Grant - 4), 26,209 options @ H105/- per option (Grant - 5), 28,825 options @ H105/- per option (Grant - 6), 11,255 options @ H105/- per option (Grant - 7), 5,000 options @ H105/- per option (Grant - 8), 21,465 options @ H105/- per option (Grant - 9), 324,637 Bonus Issue @ HNil per share, 35,102 options @ H52.50 per option (Grant - 10), 52,948 options @ H52.50 per option (Grant - 11), 292,500 options @ H52.50 per option (Grant - 12), 25,000 options @ H52.50 per option (Grant - 13), 102,948 options @ H52.50 per option (Grant - 14), 67,412 options @ H52.50 per option (Grant - 15) and 2,500 options @ H52.50 per option (Grant - 16) in accordance with the provisions of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, to the selected employees of the Company. The method of settlement is by issue of equity shares to the selected employees who have accepted the option.

Period within which options will vest to the participants

Grant-1 to Grant-10 and Grant-12, Grant-13, Grant- 15 and Grant- 16

2 years from the date of Grant of Options 33%

3 years from the date of Grant of Options 33%

4 years from the date of Grant of Options 34%

Grant-11 & Grant-14

12 months from the date of Grant of Options 100%

36 SEGMENT INFORMATION

The Company operates primarily in the business of manufacturing of Linkage Parts and Components for Off-Highway Vehicles.

Chief Operating Decision Maker (CODM), evaluates the company''s performance, based on the analysis of the various performance indicators of the company, the Chief Operating Decision Maker (CODM) has decided that there is no reportable segment for the Company.

37 DETAILS OF DUES TO MICRO AND SMALL ENTERPRISES AS DEFINED UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006 (MSMED, ACT 2006)

The Ministry of Corporate Affairs has issued notification no.G.S.R 1022(E) dated October 11, 2018 which prescribes certain disclosures regarding amount payable to micro enterprises and small enterprises. Accordingly, the disclosure in respect of the amounts payable to such enterprises has been made in the financial statements based on the information received from the vendors. The necessary information in this regard has been given hereunder :-

39 GOVERNMENT GRANT

Uniparts India Limited has availed tax and duty benefit in the nature of exemption from payment of Customs Duty, on its procurements with respect to Plant and Machinery. The said benefits were availed which entitled Uniparts India Limited to procure goods without payment of taxes and duties of amount for INR 3.15 million under Zero Duty EPCG Scheme.

In accordance with Ind AS 20 ""Accounting for Government Grants and Disclosure of Government Assistance"" Uniparts India Limited has grossed up the value of property, plant and equipment by the amount of tax and duty benefit availed considering the same as government grant. The amount of said government grant has been added to the value of property, plant and equipment with corresponding credit to deferred government grant, the amount of grant shall be amortized on a systematic basis in line with depreciation to be charged on property, plant and equipment.

Notes:

* The Company has international and specified domestic transactions with related parties. The management believes that it maintains documents as prescribed by the Income Tax Act, 1961 to prove that these transactions are at arm''s length and the aforesaid legislation will not impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

** Excludes contribution to employee retirement/post retirement and other employee benefits which are based on actuarial valuation done on an overall Company basis

*** Based on ESOP valuation on the date of grant, the fair value of grant is charged to statement of profit & loss on the basis of vesting period.

42 HEDGING ACTIVITIES AND DERIVATIVES

The Company uses foreign currency denominated borrowings and foreign exchange forward contracts for the purpose of hedging its currency risks. These contracts are not intended for trading or speculation. The foreign exchange forward contracts are designated as cash flow hedges.

Cash flow hedges

Foreign exchange forward contracts measured at fair value through OCI are designated as hedging instruments in cash flow hedges of forecast sales in US dollar. These forecast transactions are highly probable.

While the Company also enters into other foreign exchange forward contracts with the intention to reduce the foreign exchange risk of expected sales and purchases, these other contracts are not designated in hedge relationships and are measured at fair value through profit or loss

The foreign exchange forward contract balances vary with the level of expected foreign currency sales and purchases and changes in foreign exchange forward rates.

The terms of the foreign currency forward contracts match the terms of the expected highly probable forecast transactions. As a result, no hedge ineffectiveness arise requiring recognition through profit or loss. Notional amounts of outstanding forward contracts are as follows :

The cash flow hedges of the expected future sales during the year ended March 31, 2023 were assessed to be effective and a unrealised gain/(loss) of (H33.58 million), with a deferred tax assets of H8.45 million relating to the hedging instruments is included in OCI. Comparatively, the cash flow hedges of the expected future sales during the year ended March 31, 2022 were assessed to be highly effective and a unrealised gain/(loss) of (H8.02 million), with a deferred tax asset of H2.02 million was included in OCI in respect of these contracts.

The amount removed from OCI during the year and recognised in the statement of profit & loss for the year ended March 31, 2023 is detailed in Note 31 totaling H6.00 million (net of tax) [March 31, 2022: (H45.28) million (net of tax)]. The amounts retained in OCI at March 31, 2023 are expected to mature and affect the statement of profit and loss till the year ended March 31, 2024.

Reclassifications to profit or loss during the year gains or losses included in OCI are shown in Note 31.

43 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company''s principal financial liabilities other than derivatives, comprise loans and borrowings, trade payables, employee related payables and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal financial assets include loan to employees, trade receivables & other receivables and cash and cash equivalents that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company''s senior management oversees the management of these risks. The Company''s senior management is supported by a Audit committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The Audit committee provides assurance that the Company''s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. All derivative activities for risk management purposes are carried out by experienced members from the senior management who have the relevant expertise, appropriate skills and supervision. It is the Company''s policy that no trading in derivatives for speculative purposes may be undertaken. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised as below.

a) 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 prices are subject to commodity price risk, foreign exchange risk and interest rate risk.

The financial instruments that are affected by these include loans and borrowing, deposits, available-for-sale investments and derivative financial instruments. We, from time to time, undertake analysis in relation to the amount of our net debt, the ratio of fixed to floating interest rates of our debt and our financial instruments that are in foreign currencies. We use derivative financial instruments such as foreign exchange contracts to manage our exposures to foreign exchange fluctuations.

b) 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''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates. The interest rate on remaining loans (except vehicle loans), although fixed, is subject to periodic review by lending banks / financial institutions in relation to their respective base lending rates, which may vary over a period result of any change in the monetary policy of the Reserve Bank of India.

* Holding all other variable constant

The assumed movement in basis points for the interest rate sensitivity analysis is based on the currently observable market environment, showing a significantly higher volatility than in prior years.

c) Foreign currency 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 export revenue and long term foreign currency borrowings.

The Company have long term agreements with its major customers, the company face foreign exchange risk in respect of (I) our foreign currency loans, in respect of which selectively hedge currency exchange rate risk, (ii) currency mismatches between income and expenditures, which the company seek to manage as much as possible

by matching income currency to expenditure currency, and (iii) currency translation for the purpose of preparing consolidated financial statements, on account of global operations.

d) Commodity price risk

Commodity price risk is the possibility of impact from changes in the prices of raw materials such as steel, which we use in the manufacture of our products. While we seek to pass on input cost increases to our customers, we may not be able to fully achieve this in all situations or at all times.

Commodity price sensitivity

As the Company has a back to back pass through arrangements for volatility in raw material prices there is no impact on the profit and loss and equity of the Company.

e) 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, investment in mutual funds, other receivables and deposits, foreign exchange transactions and other financial instruments. In relation to credit risk arising from financing activities, we monitor our credit spreads and financial strength on a regular basis, and based on our on-going assessment of counterparty risk, we adjust our exposure to various counterparties."

f) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company''s reputation.

The management assessed that the fair value of cash and cash equivalent, trade receivables, derivative instruments, trade payables and other current financial assets and liabilities approximate their carrying amounts largely due to the short term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values: .

(i) Long-term fixed-rate and variable-rate receivables are evaluated by the Company based on parameters such as individual creditworthiness of the customer. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

(ii) The fair value of other non-current financial liabilities and security deposits, is estimated by discounting future cash flows using 10 year government bond rates. In addition to being sensitive to a reasonably possible change in the forecast cash flows or the discount rate, the fair value of the equity instruments is also sensitive to a reasonably possible change in the growth rates.

(iii) Further the management assessed that the fair value of loan to employees approximate their carrying amounts largely due to discounting at rates which are an approximation of current lending rates.

(iv) The Company enters into derivative financial instruments with various counterparties, principally financial institutions with investment grade credit ratings. Foreign exchange forward contracts are valued using valuation techniques, which employs the use of market observable inputs. The most frequently applied valuation techniques include forward pricing using present value calculations. The models incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates, yield curves of the respective currencies, currency basis spreads between the respective currencies and forward rate curves of the underlying. All derivative contracts are fully cash collateralised, thereby eliminating both counterparty and the Company''s own nonperformance risk. As at June 30, 2022 the marked-to-market value of derivative asset positions is net of a credit valuation adjustment attributable to derivative counterparty default risk. The changes in counterparty credit risk had no material effect on the hedge effectiveness assessment for derivatives designated in hedge relationships and other financial instruments recognised at fair value.

45 Capital management

The capital includes issued equity capital and other equity reserves attributable to the equity holders of the company. The primary objective of the company''s capital management is to maintain optimum capital structure to reduce cost of capital and to maximize the shareholder value.

The company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants which otherwise would permit the banks to immediately call loans and borrowings. In order to maintain or adjust the capital structure, the company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares.

46 Initial Public Offering

During the year ended March 31, 2023, the Company has completed its Offer for sale ("IPO), comprising of an offer for sale of 14,481,942 equity shares of face value H10 each at an issue price of H577 per share by existing shareholders. Pursuant to the IPO, the equity shares of the Company were listed on National Stock Exchange of India (NSE) and BSE Limited (BSE) on December 12, 2022.

47 Under an agreement with BRLMs and selling Shareholders, as part of the Offer for Sale (IPO), company had opened an Escrow Bank account with AXIS Bank for handling all IPO related proceeds and disbursements.

As on the date of the Financial Statements, the balance in the said Escrow Bank Account was H66.26 millions which Is kept for settlement of all the remaining IPO related claims of the vendors and balance to be refunded to the selling share holders.

48 Previous Year figures have been re-grouped/ re-arranged/ re-classified wherever necessary to correspond with the current year''s classification/ disclosure.