value depending on the Company’s business model for
managing the financial assets and the contractual cash
flow characteristics of the financial assets.

a) Financial assets at amortised cost

A financial asset is measured at amortised cost only
if both of the following conditions are met:

- it is held within a business model whose
objective is to hold assets in order to collect
contractual cash flows.

- the contractual terms of the financial assets
represent contractual cash flows that are solely
payments of principal and interest.

After initial measurement, such financial assets are
subsequently measured at amortized cost using the
Effective Interest Rate ('EIR’) method. Amortized cost
is calculated by taking into account any discount or
premium on acquisition and fees or costs that are
an integral part of the EIR. The EIR amortisation is
included as finance income in the Statement of Profit
& Loss. The losses arising from impairment are
recognized in the Statement of Profit & Loss.

b) Financial assets at fair value through Profit & Loss
(FVTPL)

Financial assets, which does not meet the criteria for
categorization as at amortized cost or as FVOCI, are
classified as at FVTPL.

In addition, the Company may elect to classify a
Financial assets, which otherwise meets amortized
cost or FVOCI criteria, as at FVTPL. However,
such election is allowed only if doing so reduces
or eliminates a measurement or recognition
inconsistency (referred to as 'accounting mismatch’).

Financial assets included within the FVTPL category
are measured at fair value with all changes recognized
in the Statement of Profit & Loss.

All other Financial Instruments are classified as
measured at FVTPL except investment in equity
instruments of subsidiaries and associates which
are carried at cost less provision for impairment, if
any.

iii) Derecognition of financial assets

A financial asset (or, where applicable, a part of a financial
asset or part of a group of similar financial assets) is
primarily derecognised (i.e. removed from the Company’s
balance sheet) when:

- The rights to receive cash flows from the asset have
expired, or

- The Company has transferred its rights to receive
cash flows from the asset or has assumed an
obligation to pay the received cash flows in full
without material delay to a third party under a 'pass¬
through’ arrangement; and either (a) the Company
has transferred substantially all the risks and
rewards of the asset, or (b) the Company has neither
transferred nor retained substantially all the risks and
rewards of the asset, but has transferred control of
the asset.

When the Company has transferred its rights to receive
cash flows from an asset or has entered into a pass¬
through arrangement, it evaluates if and to what extent it
has retained the risks and rewards of ownership. When
it has neither transferred nor retained substantially all
of the risks and rewards of the asset, nor transferred
control of the asset, the Company continues to recognize
the transferred asset to the extent of the Company’s
continuing involvement. In that case, the Company also
recognizes an associated liability. The transferred asset
and the associated liability are measured on a basis that
reflects the rights and obligations that the Company has
retained.

Continuing involvement that takes the form of a guarantee
over the transferred asset is measured at the lower of the
original carrying amount of the asset and the maximum
amount of consideration that the Company could be
required to repay.

On derecognition of a financial asset, the difference
between the carrying amount of the asset (or the carrying
amount allocated to the portion of the asset derecognised)
and the sum of (i) the consideration received (including any
new asset obtained less any new liability assumed) and (ii)
any cumulative gain or loss that had been recognised in
OCI is recognised in the Statement of Profit & Loss.

v) Impairment of financial assets

The Company assesses on a forward looking basis the
expected credit losses associated with its assets carried at
amortised cost and FVOCI. The impairment methodology
applied depends on whether there has been a significant
increase in credit risk.

With regard to trade receivable and loans given, the
Company applies the simplified approach as permitted
by Ind AS 109, Financial Instruments, which requires
expected lifetime losses to be recognised from the initial
recognition of the trade receivables and loans given.

B Financial liabilities

i) Initial recognition and measurement

Financial liabilities are classified, at initial recognition,
as financial liabilities at fair value through profit or loss,
amortised cost, as appropriate.

All financial liabilities are recognised initially at fair
value and, in the case of amortised cost, net of directly
attributable transaction costs.

ii) Classifications and subsequent measurement

The measurement of financial liabilities depends on their
classification, as described below:

Financial Liabilities measured at amortised cost

After initial recognition, interest-bearing loans and
borrowings are subsequently measured at amortised cost
using the EIR method. Gains and losses are recognised in
profit or loss when the liabilities are derecognised as well
as through the EIR amortisation process.

Amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that
are an integral part of the EIR. The EIR amortisation is
included as finance costs in the Statement of Profit & Loss.

iii) Derecognition of financial liabilities

The Company derecognises a financial liability when its
contractual obligations are discharged or cancelled, or
expired.

2.17 Income tax

Income tax expense comprises current and deferred tax. It is
recognised in the Statement of Profit & Loss except to the extent
that it relates to items recognised directly in Equity or in Other
Comprehensive Income.

Current tax

Current tax comprises the expected tax payable or receivable on the
taxable income or loss for the year and any adjustment to the tax
payable or receivable in respect of previous years. It is measured
using tax rates enacted or substantively enacted at the reporting
date. Current tax assets and liabilities are offset only if, the Company:

a) Has a legally enforceable right to set off the recognised
amounts; and

b) Intends either to settle on a net basis, or to realise the asset and
settle the liability simultaneously.

Deferred tax

Deferred tax is recognised on differences between the carrying
amounts of assets and liabilities in the balance sheet and the
corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are recognised for all taxable temporary
differences. Deferred tax assets are recognised for all deductible
temporary differences to the extent it is probable that taxable
profits will be available against which those deductible temporary
differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from initial recognition
of goodwill or from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction that
affects neither the taxable profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each
balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or
part of the asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that
are expected to apply in the period in which the liability is settled or
the asset realised, based on tax rates (and tax laws) that have been
enacted or substantively enacted by the balance sheet date.

2.18 Leases

The determination of whether an arrangement is (or contains) a
lease is based on the substance of the arrangement at the inception

of the lease. The arrangement is (or contains) a lease if fulfilment
of the arrangement is dependent on the use of a specific asset or
assets and the arrangement conveys a right to use the asset or
assets, even if that right is not explicitly specified in an arrangement.

Company as a lessee

The Company assesses whether a contract is or contains a lease,
at inception of the contract. The Company recognises a right-of-
use asset and a corresponding lease liability with respect to all
lease arrangements in which it is the lessee, except for short-term
leases (defined as leases with a lease term of 12 months or less)
and leases of low value assets, wherein, the Company recognises
the lease payments as an operating expense on a straight-line
basis over the lease term, unless another systematic basis is more
representative of the time pattern in which economic benefits from
the leased assets are consumed. Contingent and variable rentals are
recognized as expense in the periods in which they are incurred.

Lease Liability

The lease payments that are not paid at the commencement date,
are discounted using the interest rate implicit in the lease. If that
rate cannot be readily determined, which is generally the case for
leases in the Company, the lessee’s incremental borrowing rate is
used, being the rate that the individual lessee would have to pay to
borrow the funds necessary to obtain an asset of similar value as
that of right-of-use asset in a similar economic environment with
similar terms, security and conditions.

Lease payments included in the measurement of the lease liability
comprise:

• Fixed lease payments (including in-substance fixed payments)
payable during the lease term and under reasonably certain
extension options, less any lease incentives;

• Payments of penalties for terminating the lease, if the lease
term reflects the exercise of an option to terminate the lease.

The lease liability is presented as a separate line in the Balance
Sheet.

The lease liability is subsequently measured by increasing the
carrying amount to reflect interest on the lease liability (using the
effective interest method) and by reducing the carrying amount to
reflect the lease payments made.

The Company remeasures the lease liability (and makes a
corresponding adjustment to the related right-of-use asset)
whenever:

• The lease term has changed or there is a change in the
assessment of exercise of a purchase option, in which case the
lease liability is remeasured by discounting the revised lease
payments using a revised discount rate.

• A lease contract is modified and the lease modification is
not accounted for as a separate lease, in which case the
lease liability is remeasured by discounting the revised lease
payments using a revised discount rate.

Right of Use (ROU) Assets

The ROU assets comprise the initial measurement of the
corresponding lease liability, lease payments made at or before
the commencement day and any initial direct costs. They are
subsequently measured at cost less accumulated depreciation and
impairment losses.

Whenever the Company incurs an obligation for costs to dismantle
and remove a leased asset, restore the site on which it is located or
restore the underlying asset to the condition required by the terms
and conditions of the lease, a provision is recognised and measured
under Ind AS 37- Provisions, Contingent Liabilities and Contingent
Assets. The costs are included in the related right-of-use asset.

ROU assets are depreciated over the shorter period of the lease term
or useful life of the underlying asset. If the Company is reasonably
certain to exercise a purchase option, the right-of-use asset is
depreciated over the underlying asset’s useful life. The depreciation
starts at the commencement date of the lease.

The ROU assets are presented as a separate line in the Balance Sheet
and details of assets are given ROU note under "Notes forming part
of the Financial Statement".

The Company applies Ind AS 36- Impairment of Assets to determine
whether a right-of-use asset is impaired and accounts for any
identified impairment loss as per its accounting policy on 'property,
plant and equipment’.

As a practical expedient, Ind AS 116 permits lessee not to separate
non-lease components when bifurcation of the payments is not
available between the two components, and instead account
for any lease and associated non-lease components as a single
arrangement. The Company has used this practical expedient.

Extension and termination options are included in many of the
leases. In determining the lease term the management considers
all facts and circumstances that create an economic incentive to
exercise an extension option, or not exercise a termination option.

2.19 Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and in hand and
short-term deposits with an original maturity of three months or
less.

For the purposes of the Statement of Cash Flows, cash and cash
equivalents is as defined above, net of outstanding bank overdrafts.
In the balance sheet, bank overdrafts are shown within borrowings
in current liabilities.

2.20 Government Grants

Government grants are recognised at its fair value, where there
is a reasonable assurance that such grants will be received and
compliance with the conditions attached therewith have been met.
Grants such accured are credited to the statement of profit and loss.

Government grants related to expenditure on property, plant and
equipment are credited to the statement of profit and loss over
the useful lives of qualifying assets or other systematic basis
representative of the pattern of fulfilment of obligations associated
with the grant received.

2.21 Standard issued but not yet effective

Ind AS 1- This amendment also includes specific provisions that will
take effect for reporting periods beginning on or after 1 April, 2026,
as outlined below.

Under the existing Ind AS 1, where there is a breach of a material
provision of a long-term loan arrangement on or before the end of
the reporting period with the effect that the liability becomes payable
on demand on the reporting date, the entity does not classify the
liability as current, if the lender agreed, after the reporting period
and before the approval of the financial statements for issue, not to
demand payment as a consequence of the breach.

However, the amended requirements stipulate that entities will no
longer be permitted to consider lender waivers that are granted after
the reporting date but before the financial statements are approved
for the purpose of classification of loans. This amendment is
required to be applied retrospectively in accordance with Ind AS 8.
The Company does not expect this amendment to have an impact
on its operations or financial statements.

(ii) Equity shares extinguished on buy-back

The shareholders of the Company vide postal ballot notice dated 26 October, 2023 approved the proposal of buyback 14,70,588 fully paid-up
Equity Shares of the Company on a proportionate basis, through the tender offer route, at a price of ' 850/- per Equity Share payable in cash for
an aggregate amount not exceeding ' 12,500 Lakhs (excluding transaction cost and taxes) on 2 December, 2023. The Company bought back
14,70,588 fully paid-up Equity Shares and settled all valid bids and extinguished equity shares bought back during year ended 31 March, 2024.

f. Shares reserved for issue under options

Information relating to Somany Ceramics Employee Stock Option Plan 2021 (ESOP 2021)and Somany Ceramics Employee Stock Option Plan 2023
(ESOP 2023), including details of options issued, exercised and lapsed during the financial year and options outstanding at the end of the reporting
period, is set out in note 47.

♦Working Capital Facilities from Banks are secured by:

a First charge by way of hypothecation of current assets including stocks of raw materials, finished goods, stock in trade and inventory work in
progress, stores & spares and book debts and ranking pari-passu; and

b Second and subservient charge by way of hypothecation of all movable fixed assets & ranking pari-passu, excluding assets exclusively charged.

c Rate of interest is variable and linked with MCLR as at 31 March, 2026 ranging between 6.75 % to 9.90% (previous year 9.15% to 9.70%).

El CONTINGENT LIABILITIES, CONTINGENT ASSETS AND COMMITMENTS AS IDENTIFIED BY THE COMPANY (CONTD.)

Pending resolution of the respective proceedings, it is not practicable for the Company to estimate the timings of cash outflows, if any, in respect
of the above as it is determinable only on receipt of judgments/ decisions pending with various forums/ authorities. However, the Company has
reviewed all its pending litigation and proceeding and has adequately provided for where provision required and disclosed as contingent liabilities
where applicable, in its financial statements. The Company does not expect the outcome of these proceeding to have a materially adverse effect on
its financial position. The Company does not expects any payment in respect of the above contingent liabilities.

(ii) The Company, in terms of the Share Subscription cum Shareholders Agreements with subsidiary companies, may contribute funds (loan /
equity) in the proportion of its shareholding for the purpose of meeting repayment obligation to banks, financial institutions or other lenders,
any statutory liability, liabilities towards fuel suppliers or such other similar liabilities, fund requirement for expansion/ diversification, etc. The
Company shall not withdraw the funds so infused, if any, till the money remain due to bank.

E9 LOANS AND ADVANCES PURSUANT TO REGULATION 34(3) AND 53(f) OF SEBI (LISTING OBLIGATION AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2015:(ii) Defined Benefit Plan:

Consequent to the implementation of the Code on Wages, 2019, the Company has reassessed the definition of wages applicable for employee
benefits and based on the actuarial valuation, the consequent impact of the wage code has been treated as a past service cost and recognised in the
profit or loss in accordance with Ind AS 19. Also refer Note No. 46.

The most recent actuarial valuation of plan assets and the present value of the defined benefit obligation for gratuity were carried out as at 31
March, 2026. The present value of the defined benefit obligations and the related current service cost and past service cost, was measured using the
Projected Unit Credit Method.

A. Movement in net defined benefit (asset)/liability

The following table shows a reconciliation from the opening balances to the closing balances for net defined benefit (asset)/liability and its
components:

n EMPLOYEE BENEFITS (CONTD.)

Demographic Assumption

Attrition rates are the Company’s best estimate of employee turnover in future determined considering factors such as nature of business &
industry, retention policy, demand & supply in employment market, standing of the Company, business plan, HR Policy etc as provided in the
relevant accounting standard. Attrition rates as given below have been received as input from the Company.

Sensitivities due to mortality and withdrawals are insignificant, hence ignored. Sensitivities as to rate of inflation, rate of increase of pensions in
payment, rate of increase of pensions before retirement and life expectancy are not applicable being a lump sum benefit on retirement.

Although the analysis does not take account of the full distribution of cash flows expected under the plan, it does provide an approximation of
the sensitivity of the assumptions shown.

E. Description of Risk Exposures:

Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such Company is exposed to various risks as
follow -

A) Salary Increases- Higher than expected increase in salary will increase the defined benefit obligation.

B) Investment Risk - Assets / liabilities mismatch and actual investment return on assets lower than the discount rate assumed at the last
valuation date can impact the liability / Assets.

C) Discount Rate - Reduction in discount rate in subsequent valuations can increase the plan’s liability.

D) Mortality & disability - Actual deaths & disability cases proving lower or higher than assumed in the valuation can impact the liabilities.

E) Withdrawals - Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent
valuations can impact Plan’s liability.

II. Financial risk management

The Company has exposure to the following risks arising from financial instruments:

- credit risk;

- liquidity risk; and

- market risk

i. Risk management framework

The Company’s board of directors has overall responsibility for the establishment and oversight of the Company’s risk management framework.
The board of directors has established the processes to control risks through defined framework.

The Company’s risk management policy is established to identify and analyse the risks faced by the Company, to set appropriate controls. Risk
management policy is reviewed by the board annually to reflect changes in market conditions and the Company’s activities.

The Company’s Audit Committee oversees compliance with the Company’s risk management policy, and reviews the adequacy of the risk
management framework in relation to the risks faced by the Company. The Audit Committee is assisted in its oversight role by Internal Audit.
Internal Audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the
Audit Committee.

ii. Credit risk

Financial loss to the Company, arising, if a customer or counterparty to a financial instrument fails to meet its contractual obligations principally
from the Company’s receivables from customers and investments in debt securities.

The carrying amount of financial assets represents the maximum credit exposure. The Company monitor credit risk closely both in domestic and
export market.

Trade and other receivables

The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers
the factors that may influence the credit risk of its customer base, including the default risk of the industry and country in which customers operate.
The Company Management has established a credit policy under which each new customer is analyzed individually for creditworthiness before
the Company’s standard payment and delivery terms and conditions are offered. Sales credit limit are set up for each customer and reviewed

ECT FINANCIAL INSTRUMENTS - FAIR VALUES AND RISK MANAGEMENT (CONTD.)

periodically. The credit risk from loans to other corporate is managed in accordance with the Company’s fund management policy that includes
parameters of safety, liquidity and post tax returns. The Company’s review includes market check, industry feedback, past financials and external
ratings, if they are available, and in some cases bank reference checks are also done.

The Company creates allowances for impairment that represents its expected credit losses in respect of trade and other receivables. The
management uses a simplified approach for the purpose of computation of expected credit loss for trade receivables.

Investments and Cash Deposits

Credit risk from balances with banks is managed by the Company’s finance department.

Company invests in Bonds, Debentures, Liquid Mutual Funds, Equity instruments etc., in accordance with the Company’s Investment Policy that
includes parameters of safety, liquidity and post tax returns. Company avoids the concentration of credit risk by spreading them over several
counterparties with good credit rating profile and sound financial position as well as held to maturity policy. The Company’s exposure and
credit ratings of its counterparties are monitored on an ongoing basis. Based on historical experience and credit profiles of counterparties, the
Company does not expect any significant risk of default other than as disclosed.

Ea FINANCIAL INSTRUMENTS - FAIR VALUES AND RISK MANAGEMENT (CONTD.)
v. Currency risk

Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not
the Company’s functional currency (INR). The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily
with respect to the USD and small exposure in CNY, AUD, EURO & NPR. The risk is measured through a forecast of highly probable foreign
currency cash flows.The Company has no significant currency exposure.

Exposure to currency risk

The summary quantitative data about the Company’s exposure to currency risk as reported to the management of the Company is as follows
(Foreign currency in Lakhs).

EH EXCEPTIONAL ITEMS

i. The Government of India has notified and brought into force on 21 November, 2025 four new Labour Codes viz the Code on Social Security, 2020

("Social Security Code"); the Occupational Safety, Health and Working Conditions Code, 2020; the Industrial Relations Code, 2020 and the Code
on Wages, 2019 (collectively, the "Labour Codes"), which subsume, amend and replaces numerous existing central labour legislations. Till date
certain specific rules and corresponding State-level notifications are yet to be notified.

Pursuant to the guidance issued by the Institute of Chartered Accountants of India (ICAI) and based on independent actuarial valuations, the
Company has recognized additional provisions for past service obligations relating to gratuity and compensated absences for the year ended 31
March, 2026, amounting to ' 508.79 Lakhs.

ii The Company has divested its investment in one of its subsidiary "Acer Granito Private Limited", w.e.f 1 December, 2024 through an agreement,
dated on 4 February, 2025, with the existing shareholders of the subsidiary resulting gain on divestment of ' 544.30 Lakhs, during the year ended
31 March, 2025.

iii. The Company has divested its investment in one of its subsidiary "Amora Tiles Private Limited", w.e.f 1 December, 2024 through an agreement,

dated on 4 February, 2025, with the existing shareholders of the subsidiary resulting gain on divestment of ' 397.80 Lakhs, during the year ended
31 March, 2025.

£3 SHARE BASED PAYMENTS
a) Scheme Details

Nomination and Remuneration Committee (NRC) and Board of Directors at its respective meetings held on 10 December, 2021 and 23 May, 2023,
approved an issue of stock options aggregating 4,23,794 and 12,74,226 equity shares of the face value of ' 2 each, up to a maximum of 1% and 3%
of the then issued equity capital of the Company respectively. The shareholders of the Company vide their special resolutions passed through postal
ballot on 7 April, 2022 and passed at its 55th Annual General Meeting (AGM) held on 25 August, 2023 approved the issue of equity shares of the
Company under Somany Ceramics Employee Stock Option Plan 2021 (ESOP 2021)and Somany Ceramics Employee Stock Option Plan 2023 (ESOP
2023) respectively.

E3 DIVIDEND

During the year, the Company has paid dividend of ' 3/- per equity share aggregating ' 1,230.38 Lakhs towards final dividend for the year ended 31
March, 2025, also the Board of Directors of the Company at their Meeting held on 4 May, 2026 has approved payment of interim dividend of ' 4/- per
equity share of face value of ' 2/- each for the financial year 2025-26.

Further, the Board of directors has recommended dividend of ' 2/- per equity share aggregating ' 820.26 Lakhs in their meeting held on 15 May, 2026
for the financial year ended 31 March, 2026 and same is subject to approval of shareholders at the ensuing Annual General Meeting.

EH SEGMENT REPORTING

According to Ind AS 108, identification of operating segments is based on Chief Operating Decision Maker (CODM) approach for making decisions
about allocating resources to the segment and assessing its performance. The business activity of the Company falls within one broad business
segment viz. "Ceramic Tiles and Allied products" and substantially sale of the products and Non-current assets are within the country. Hence, the
disclosure requirement of Ind AS 108 of 'Segment Reporting’ is not considered applicable.

Based on the information available, as identified by the management there are certain vendors who have confirmed that they are covered under the
Micro, Small and Medium Enterprises Development Act, 2006. Disclosures relating to dues of Micro and Small enterprises under section 22 of 'The
Micro, Small and Medium Enterprises Development Act, 2006, are given below:

(C) - Supplier Financing Arrangements

The Company has entered into supplier financing arrangements under which the Company’s suppliers may elect to an early payment from financing
partners or continued to be paid in line with the agreed payment terms. In cases where supplier opts for early payment under supplier finance
arrangement, such amounts are disclosed under other current financial liabilities. In either case, the liability payable by the Company remains
unchanged and no additional security is provided to the financer.

The Company evaluates these arrangements to assess the characteristics of such payables, and all such liabilities were classified as mentioned
below :

EM ADDITIONAL REGULATORY INFORMATION REQUIRED BY SCHEDULE III TO BE DISCLOSED IN THE FINANCIAL STATEMENTS:

i) The Company does not have transactions with companies struck off under section 248 of the Companies Act, 2013 or Section 560 of Companies
Act 1956.

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

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

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

El ADDITIONAL REGULATORY INFORMATION REQUIRED BY SCHEDULE III TO BE DISCLOSED IN THE FINANCIAL STATEMENTS: (CONTD.)

v) There is no undisclosed income under the tax assessments under the Income Tax Act, 1961 for the year ending 31 March, 2026 and 31 March,
2025 which needs to be recorded in the books of account.

vi) The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

vii) Utilisation of borrowed funds and share premium:-

a) The Company during the year has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities
(Intermediaries) with the understanding that the Intermediary shall directly or indirectly lend or invest in other persons or entities identified
in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or provide any guarantee, security or the like to or on
behalf of the ultimate beneficiaries.

b) The Company during the year has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with
the understanding (whether recorded in writing or otherwise) that the Company shall directly or indirectly lend or invest in other persons or
entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or provide any guarantee, security
or the like on behalf of the ultimate beneficiaries.

viii) Borrowings obtained by the Company from banks and financial institutions have been applied for the purposes for which such loans were was
taken.

ix) The Board of Directors of the Company at its Board Meeting held on 7 November, 2025, subject to requisite approvals/consents, approved the
proposed Scheme of Amalgamation of wholly owned subsidiaries Somany Bathware Limited, Somany Excel Vitrified Private Limited and SR
continental Limited with and into the Company ("Scheme") in terms of Sections 230 to 232 and other applicable provisions of the Companies
Act, 2013. The aforementioned scheme, having appointed date of 1 April, 2025, is subject to required regulatory and other necessary approvals.

59 The Company has been sanctioned working capital limit from bank on the basis of security of current assets. The quarterly returns/ statements filed
by the Company with the bank, are in agreement with the books of accounts of the Company of the respective quarters.

60 During the financial year 2018-19, the Company had discovered defalcation of ' 1,585.82 Lakhs committed by an employee. The Company has
filed a civil as well as a criminal suit against him and his wife, being the beneficiaries. During the pendency of the suit, he and his wife have signed
a 'Memorandum of Understanding’ (MOU) dated 11 February, 2021 with the Company, duly acknowledged by Hon’ble High Court of Gujarat vide its
order dated 12 February, 2021, under which he and his wife offered their immovable properties to the tune of ' 660.00 Lakhs (net off loan of ' 40.17
Lakhs), which has since been transferred in the name of the Company, as value determined by the Hon’ble High Court of Gujarat and a sum of ' 40.00
Lakhs deposited by them in the Court towards compliance of their Bail condition. In terms of the said MOU, the Company is obligated to attempt
to sell the properties in a diligent manner and quantify the amount received upon sale of such properties (net of expenses) and submit a purshis(s)
of the same with the Hon’ble Civil Court. The Company has during the year sold two properties and increased the "Liability under Defalcation Suit".
Awaiting the final decree of the Hon’ble Civil Court, the Company is holding the properties in fiduciary capacity and disclosed the same as 'Properties
held in trust’ under Note no. 15 amounting to ' 239.81 Lakhs (Previous year ' 363.77 Lakhs) and also recognised 'Liability under Defalcation Suit’
amounting to ' 642.92 Lakhs (net of Expenses) (Previous year ' 639.73 Lakhs) under Note no 26. The final accounting and taxation of the amounts
mentioned in the purshis(s) would be done based on the final verdict of the Hon’ble Civil Court.

61 The Company, in the earlier years, had fully impaired its investment of ' 1,844.73 Lakhs in NCDs, issued by SREI Equipment Finance Limited. In
the previous year, Hon’ble NCLT Kolkata approved resolution plan under Insolvency & Bankruptcy Code, 2016. In terms of the Approved Resolution
Plan, the implementation notice was issued by National Asset Reconstruction Company Limited ("NARCL") and Implementation and Monitoring
Committee ("IMC") authorized the administrator for commencement of the distribution against claims with the record date set as at 6 October, 2023.
In terms of the Approved Resolution Plan, the Company was awarded ' 590.45 Lakhs to be received in cash and by way of allotment of Security
Receipts (SRs)/ Optionally Convertible Debentures (OCDs)/Equity.

As per aforementioned resolution plan upto 31 March, 2026, the Company has received ' 198.55 Lakhs. (FY 2025-26'33.00 Lakhs against SRs; FY 2024¬
25'36.35 Lakhs against SRs)

Pending ascertainment of the issue terms and conditions, these SRs/ OCDs has been disclosed under the head "Other Financial Assets" at an estimated
value of ' 168.07 Lakhs (previous year ' 225.08 Lakhs).

62 a) The Company has been maintaining its books of accounts in a ERP Software having the feature of recording audit trail of each and every

transaction, creating an edit log of each change made in books of account along with the date when such changes were made and ensuring that
the audit trail cannot be disabled, throughout the year as required by proviso to sub rule (1) of Rule 3 of The Companies (Accounts) Rules, 2014
(the "Rules"), except audit trail feature has not been enabled for certain tables at application and database level to capture direct changes made
to such tables through privilege access. However, the Company continues to ensure that privilege access is granted only via approved change
management process.

b) Evidence of audit trail enablement in respect of third-party software, used by the Company for supplier finance arrangement has not been
provided by the vendor to the Company. Although no access for direct change in database is with the company and vendor has control over
privilege access through change management process.

63 The figures of the previous period have been regrouped/reclassified, wherever considered necessary, to conform current period classifications.The
impact of the such regrouping/reclassification is not material.