25 a) Endurance GmbH, Germany

The total investment of the Company in Endurance GmbH, Germany (a wholly owned subsidiary of the Company) as on 31st March, 2023 amounts to ' 1,930.62 million (Euro 30.93 million) [Previous year ' 1,930.62 million (Euro 30.93 million)]

b) Endurance Overseas Srl, Italy (EOSrl)

The total investment of the Company in EOSrl as at 31st March, 2023 amounts to ' 1,706.99 million (Euro 25.83 million) [Previous year ' 1,706.99 million (Euro 25.83 million)].

c) Maxwell Energy Systems Pvt Ltd

The Company executed a Share Subscription and Purchase Agreement dated 18th May, 2022 ('the Agreement') with Maxwell Energy Systems Private Limited ("Maxwell") and its shareholders for acquiring 100% of the equity share capital of Maxwell in a phased manner. Maxwell is engaged in manufacture of battery management systems (BMS) for electric vehicles. On 1st July, 2022 the Company acquired 51% stake in the equity share capital of Maxwell through a combination of primary issuance and secondary purchase and paid a consideration of ' 1,350.00 million. As a result, Maxwell became a subsidiary of the Company with effect from 1st July, 2022. Further, as per the Agreement, the balance 49% of the equity share capital of Maxwell will be purchased by the Company in five tranches spread over next five financial years. The consideration for each tranche will depend on Maxwell achieving certain financial targets as specified in the Agreement with a floor and cap on the total consideration payable for each tranche.

The investment value of ' 1,356.18 million includes consideration for shares of ' 1,350.00 million and stamp duty charges of ' 6.18 million.

26 TP Green Nature Limited

During the year, the Company has acquired 26% stake in TP Green Nature Limited by purchasing 65,84,488 equity shares for ' 65.84 million. TP Green Nature Limited is a special purpose vehicle incorporated by TATA Power Renewable Energy Limited and is engaged in the business of solar power generation. The purpose of investment is to purchase the electricity units for plants at Chakan and Waluj for captive consumption. Based on the terms of the Power Delivery Agreement with TP Green Nature Limited and the Share Holders' Agreement with Tata Power Renewable Energy Limited, the Company has classified this investment as financial instrument measured at fair value through statement of profit and loss.

27 Pierer Mobility AG, Austria

During the year, the Company executed a Share Purchase agreement with Pierer Konzerngesellschaft mbH, a shareholder of PIERER Mobility AG, Austria (' PMAG'), to purchase the equity shares of PMAG, worth of EUR 4 million in two equal tranches in financial year 2022-23 and 2023-24. PMAG is a European manufacturer of powered two wheelers and is listed on the Swiss stock exchange, Zurich.

In current financial year, the Company has invested in 31,654 equity shares (0.09% stake) in Pierer Mobility AG, Austria at a cost of ' 162.20 million (Euro 2.0 million) and has opted for irrevocable option of recognising fair value change through Other Comprehensive Income (OCI) as this is a startegic investment. Thus, disclosing their fair value fluctuation in profit or loss will not reflect the purpose of holding. The restated investment value as on 31st March, 2023 at ' 222.43 million and fair value gain for the year is ' 60.23 million.

1 Future cash outflow, if any, in respect of these matters are determinable only on receipt of judgements / decisions pending at various stages before the appellate authorities.

2 Represents deposits with the Maharashtra Pollution Control Board, based on order passed by the Hon'ble National Green Tribunal (NGT). National Green Tribunal (NGT) disposed of the appeal in the current financial year, with the net demand of ' 18.96 Million. The compensation has been recognised in the profit and loss account as the Company is not pursuing for further appeal.

3 The Goods and Service Tax Department issued a demand notice (dated November 10, 2022) relating to the alleged availing of GST credit without receiving the goods processed from jobwork location during the period Jul 2017 to Mar 2018.

The company has submitted clarification to the Deputy Commissioner SGST Uttarakhand on 22nd November, 2022 against which order is awaited.

(b) Defined benefit plan:

The defined benefit plan comprises gratuity (included in contribution to provident and other funds in note 21). The present value of the obligation under such defined benefit plan is determined based on an actuarial valuation as at the reporting date using the Projected Unit Credit Method. The present value of accrued gratuity is provided in the books after reducing the fund value with Life Insurance Corporation of India.

(b) Fair value of quoted mutual funds is based on the net assets value at the reporting date. The fair value of other financial liabilities as well as other non current financial liabilities is estimated by discounting future cash flow using rate currently applicable for debt on similar terms, credit risk and remaining maturities.

(c) The fair value of the Company's interest bearing borrowing received are determined using discount rate that reflects the entity's borrowing rate as at the end of the reporting period. The own non performance risk as at the end of reporting period was assessed to be insignificant.

Fair value hierarchy

All financial instruments for which fair value is recognized or disclosed are categorized within the fair value hierarchy described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1: Quoted (unadjusted) price is active market for identical assets or liabilities

Level 2: Valuation technique for which the lowest level input that has a significant effect on the fair value measurement are observed , either directly or indirectly

Level 3: Valuation technique for which the lowest level input has a significant effect on the fair value measurement is not based on observable market data

The management assessed that the fair values of short term financial assets and liabilities significantly approximate their carrying amounts largely due to the short - term maturities of these instruments. The fair value of the financial assets and liabilities is the amount at which the instrument could be exchanged in a current transaction among willing parties, other than in a forced or liquidation sale.

The Company determines fair values of financial assets and financial liabilities by discounting the contractual cash inflows/ outflows using prevailing interest rates of financials instruments with similar terms. The initial measurement of financial assets and financial liabilities is at fair value. The fair value of investment is determined using quoted net assets value from the fund/share market prices. Further, the subsequent measurement of all financial assets and liabilities (other than investment in mutual funds, equity shares and foreign currency derivatives) is at amortised cost, using the effective interest method.

Discount rates used in determining fair value

The interest rate used to discount estimated future cash flows, where applicable, are based on the incremental borrowing rate of the borrower which in case of financial liabilities is the weighted average cost of borrowing of the Company and in case of financial assets is the average market rate of similar credit rated instrument.

The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available. In addition, the Company internally reviews valuation, including independent price validation for certain instruments.

Fair value of financial assets and liabilities is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique.

The following methods and assumptions were used to estimate fair value:

(a) Fair value of short term financial assets and liabilities significantly approximate their carrying amounts largely due to the short term maturities of these instruments.

33 Financial Instruments and Risk Review I. Capital Management

The Company's capital management objectives are:

The Board policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Board of Directors monitors the return on capital employed on a quarterly basis.

The Company manages capital risk by maintaining sound/optimal capital structure through monitoring of financial ratios, such as debt-to-equity ratio and net borrowings-to-equity ratio on a quarterly basis and implements capital structure improvement plan when necessary.

The Company uses net debt to equity ratio as a capital management index and calculates the ratio as net debt divided by total equity. Net debt and total equity are based on the amounts stated in the financial statements.

II. Financial Risk Management Framework

The Company is exposed primarily to market risk (fluctuations in foreign currency exchange rates and interest rate), credit risk, liquidity risk, which may adversely impact the fair value of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial performance of the Company.

i) Credit Risk

Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to contractual terms. Credit risk encompasses, the risk of default, the risk of deterioration of creditworthiness of the counterparty as well as concentration of risks.

Financial instruments that are subject to exposure to credit risk consist of trade receivables, investments and other financial assets.

Credit risk is the risk that a 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 operating activities, primarily from trade receivables.

Trade receivables

Trade receivables consist of receivables arising primarily due to sale of goods. These receivables are unsecured and mature at the end of a specified credit period depending upon the terms of contract of each customer, which ranges from 30-60 days for customers in India and 30-120 days for overseas customers. The Company's customers primarily consist of Original Equipment Manufacturers ("OEM") for its primary products and Dealers for spare parts.

The Company assesses the credit risk of its customers and dealers at the time of acceptance of the customer as well as on an ongoing basis. Before accepting any new customer, the Company uses an external/internal credit scoring system to assess the potential customer's credit quality and defines credit limits by customer. The credit limit of these customers and dealers is continuously monitored and recalibrated based on the credit risk assessment. Most of the OEM's have high credit ratings which helps the Company mitigate credit risk.

The Company assesses at each reporting date whether a trade receivable or a group of trade receivables is impaired. The Company recognizes lifetime expected credit losses for all trade receivables that do not constitute a financing transaction and which are due for more than six months. The expected credit losses are measured at an amount equal to 12 month expected credit losses or at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. The Company uses a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix.

Company's exposure to customers is diversified and some customers contribute more than 10% of outstanding accounts receivable which forms 60% of total receivables as of 31st March, 2023 (70% as at Previous year), however there was no default on account of those customers in the past.

The Company considers the trade receivables to have low risk of defaults since the customers have strong capacity to fulfil their obligations and even if there are adverse changes in economic and business conditions, the Company is of the view that it will not adversely affect the ability of the customers to fulfil their obligations.

The Company considers write-off of receivables on case to case basis, depending upon the circumstances of each delayed receivable, and when the Company is of the view that recovery seems unlikely after reasonable efforts.

Investments and other financial assets

Investments consist mainly of investments in equity of subsidiaries and other companies, investments in mutual funds and fixed deposits. Other financial assets consist of Government incentive receivables, export incentive receivables and security deposits for business purposes.

Investments in mutual funds are primarily those instruments which have been approved by the Board and are in low-risk category and are continuously monitored by the investment committee of the Board. The Company considers credit risk in investments as well as in other financial assets to be very low.

ii) Liquidity Risk

Liquidity risk is the risk that the Company may not be in a position to meet its financial liabilities. The objective of liquidity risk management is to maintain sufficient liquidity and to ensure availability of adequate funds for business. The Company

Wherever, transactions are undertaken in foreign currency, the Company hedges the risk of foreign exchange fluctuation by using derivative financial instruments in line with its risk management policies. The investment in subsidiaries being long term in nature is unhedged. The information on derivative instruments and the unhedged foreign currency exposures are as follows:

(a) Derivative financial instruments

The Company uses derivative financial instruments, such as foreign currency forward contracts and fixed currency swaps, to hedge its foreign currency risks. Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.

Any gains or losses arising from changes in the fair value of derivatives are taken directly to profit or loss. The foreign exchange forward contracts are not designated as cash flow hedges and are entered into for periods consistent with foreign currency exposure of the underlying transactions, generally from 1 to 48 months.

iii) 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 like commodity prices risk.

1) 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 debt obligations which have floating rate indebtedness. The Company also maintain deposits of cash and cash equivalents with banks which are subject to periodic resets.

2) Foreign Currency exchange rate risk

Foreign currency exchange rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. At a standalone level the Company is exposed to currency risk of changes in EURO, USD, CHF, CNY, GBP, SGD and JPY. However, the risk of changes in foreign exchange rates on the statement of profit or loss and other comprehensive income is not material. The Company has an exposure to changes in foreign exchange (primarily EURO) on account of its investments in its subsidiaries.

vi) Commodity Price risk

The Company is exposed to risks in fluctuation of prices of certain raw materials, which are used as key inputs in the production process, especially ferrous and non-ferrous metals. Historically, as a practice, and as per our understanding with customers, the Company has passed on an increase in the cost of metals, especially aluminium and steel to its customers and does not foresee a significant risk to its statement of profit and loss on account of fluctuations in the material prices.

34 Related party disclosure as required by Ind-AS 24 is annexed. Key Management Personnel (KMP) has been identified as per Ind-AS 24.

35 Government incentives:

(a) Industrial Promotion Subsidy:

Incentive under Mega Project Scheme - PSI 2013

The Company recognises grant income under the Package Scheme of Incentives 2013, Government of Maharashtra ("PSI Scheme") on sale of goods, as management believes that the realisation of the grant income is reasonably certain.

The Company has recognized an amount of ' 589.27 million (previous year ' 594.89 million) as grant income under Mega Project scheme PSI 2013 for the year ended 31st March, 2023. In the previous year the Company had also recognized ' 39.01 million against balance related to PSI 2007 scheme for which sanction was received in March 2022.

(b) EPCG benefit:

The Company had imported plant and equipment under EPCG scheme and saved customs duty of ' 19.11 million against the export obligation of '114.67 million, the duty saved was capitalized. The pending export obligation as on 31st March, 2023 is ' Nil million (previous year ' 49.27 million).

In accordance with Ind-AS 20, ' 8.21 million (previous year ' Nil million) is recognized as incentive received.

(c) Export Incentive:

The Company has recognized '18.07 million (previous year ' 18.34 million) as export incentive under RODTEP scheme for the year ended on 31st March,2023.

During the year, the Company also recognized ' 29.06 million (previous year ' 30.41 million) as export incentive under duty drawback scheme.

Further the Company also recognized ' 44.78 million (previous year ' 47.02 million) as incentive under advance authorisation licence scheme.

38 Subsequent event

On 17th May, 2023, the Board of Directors of the Company have proposed a dividend of ' 7 per equity share of face value ' 10 each in respect of the year ended 31st March, 2023. The dividend payout is subject to approval of the shareholders at the Annual General Meeting.

During the current year, final dividend for the year ended 31st March, 2022 was declared and paid at ' 6.25 per equity share of face value ' 10 each.

39 The ongoing Russia-Ukraine crisis has not impacted the normal business operations of the Company. Management believes that it has fully considered all the possible impact of known events in the preparation of the standalone Ind AS financial statements. However, the impact assessment is a continuing process, given the uncertainties associated with its nature and duration. The Company will continue to monitor any material changes to future economic conditions and the consequent impact on its business, if any.

During the year the Company had total cash outflows for leases of ' 16.85 million (previous year ' 9.99 million). The Company also had non-cash additions to right-of-use assets and lease liabilities of ' 83.96 million (previous year ' 2.22 million)

41 Exceptional Items - During the current year, the Company announced a Voluntary Separation scheme (VSS) for its employees at its B-20 Chakan plant, Maharashtra. Fifty Six employees opted for the scheme. The company settled their dues on 30th June, 2022. The Company also paid ' 102.85 million as separation Compensation to the said employees on 30th June, 2022 which is disclosed as an exceptional item in the statement of profit and loss.

During the previous year, the Company had announced a Voluntary Separation Scheme (VSS) for its employees at its B-1/3 Chakan plant, Maharashtra. One hundred and seventy seven employees opted for the scheme. The Company settled the dues to employees on 19th June,2021. The Company also paid ' 314.50 million as separation Compensation to the said employees on 19th June, 2021 which is disclosed as an exceptional item in the statement of profit and loss.

42 Ratios to the financial statements are annexed.

43 Segment reporting

Information reported to the chief operating decision maker (CODM) for the purposes of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided. The Company is in the business of manufacture and sale of automobile components, which in the context of Indian Accounting Standard 108 'Operating Segment' represents a single reportable business segment. The accounting policies of the reportable segments are the same as the accounting policies disclosed in Note 2.

In accordance with Ind AS - 108, disclosures in regard to "Operating Segments" have been included in the consolidated Ind AS financial statements and therefore no separate disclosure on segment information is given in these financial statements.

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

(iii) The Company does not have any charges or satisfaction which are yet to be registered with Registrar of Companies (ROC) beyond the statutory period.

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

(v) The Company has not advanced or loaned or invested funds to any other person or entity, including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

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

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

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

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

b. provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(vii) The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961.