XXIII. Provisions and contingent liabilities

A provision is recognized if, as a result of past event, the
company has a present obligation (legal or constructive) and
on management judgement that is reasonably estimable and
it is probable that an outflow of economic benefits will be
required to settle the obligation.

If the effect of the time value of money is material, provisions
are discounted using a current pre-tax rate that reflects, when
appropriate, the risks specific to the liability. When discounting
is used, the increase in the provision due to the passage of time
is recognized as finance cost.

Contingent liability is disclosed in the case of:

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

• A present obligation arising from past events, when no
reliable estimate is possible.

• A possible obligation arising from past events unless the
probability of outflow of resources is remote.

Commitments include the amount of purchase order (net of
advances) issued to parties for completion of assets.

Provisions, contingent liabilities, contingent assets and
commitments are reviewed at each balance sheet date.

XXIV. Current and non-current classification

The company has ascertained its operating cycle as twelve
months for the purpose of current / non-current classification

of assets and liabilities. This is based on the nature of products
and the time between acquisition of assets for processing and
their realisation in cash and cash equivalents. Current Assets
and current liabilities include current portion of non-current
financial assets and non-current financial liabilities respectively.

Note 2 (ii): Critical accounting estimates

Useful lives of property, plant and equipment

The estimated useful lives of property, plant and equipment are
based on a number of factors including the effects of obsolescence,
internal assessment of user experience and other economic factors
(such as the stability of the industry and known technological
advances) and the level of maintenance expenditure required to
obtain the expected future cash flows from the asset.

The Company reviews the useful life of property, plant and
equipment at the end of each reporting date.

Recoverable amount of property, plant and equipment

The recoverable amount of property plant and equipment is based
on estimates and assumptions regarding the expected market
outlook and expected future cash flows. Any changes in these
assumptions may have a material impact on the measurement of the
recoverable amount and could result in impairment.

Post-retirement benefit plans

Employee benefit obligations are measured on the basis of actuarial
assumptions including any changes in these assumptions that may
have a material impact on the resulting calculations.

Recognition of deferred tax assets

Recognition of deferred tax assets depends upon the availability of
future profits against which tax losses carried forward can be used.

The company has paid 40% (H 4 per equity share of H 10/- each)
interim dividend during the year ended 31-Mar-2025 and 50%
(H 5 per equity share of H 10/- each) during the year ended 31-
Mar-2024. Dividend declared and distributed on number of
shares outstanding before sub-division of equity shares.

b. Rights, preferences and restrictions attached to equity
shares

The company presently has one class of equity shares having
a par value of H2/- each (previous year H10/- each). Each holder
of equity shares is entitled to one vote per share. The dividend
if proposed by the Board of Directors is subject to the approval
of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the company, the holders of
equity shares will be entitled to receive any of the remaining
assets of the company, after distribution of all preferential
amounts. The distribution will be in proportion to the number
of equity shares held by the shareholders.

* The equity shares of the Company have been sub-divided from face value of H10/-
per equity shares to face value of H 2/- per equity share with the effect from record
date of 11-Mar-2025.

d. There are no shares issued without payment being received in
cash during the last five years.

e. There are no buy back of equity shares during the last five years.

f. There are no bonus shares issued during the last five years.

g. There is no holding / ultimate holding company ofthe company.

Nature and purpose of reserve

Capital reserve: The excess of net assets taken, over the cost of
consideration paid, were treated as capital reserve in accordance
with previous GAAP.

Securities premium: The amount received in excess of face value of
the equity shares is recognised in Securities Premium. It can be utilized
in accordance with the provisions of the Act, to issue bonus shares,
to provide for premium on redemption of shares or debentures,
write-off equity related expenses like underwriting costs etc.

Retained earnings: Retained earnings if any represents the net
profits after all distributions and transfers to other reserves.

Other comprehensive income:

Cash flow hedge reserve

The cumulative effective portion of gains or losses arising from
changes in fair value of hedging instruments designated as cash
flow hedges are recognised in cash flow hedge reserve. Such

Details of security for Loan repayable on demand

Loans repayable on demand from banks are secured by way of first
pari-passu charge on all present and future by way of hypothecation
of finished goods, work-in-progress, raw materials, stores and spares,
book debts, other current assets and pari-passu charge on

Details of security for Loan repayable on demand

Loans repayable on demand from banks are secured by way of first
pari-passu charge on all present and future by way of hypothecation
of finished goods, work-in-progress, raw materials, stores and
spares, book debts, other current assets and pari-passu charge on
fixed assets as collateral security and further secured by personal
guarantee of the Managing Director of the company.

# Export obligations relates to duty saved on import of raw materials
under the Advance Authorization Scheme. Under the scheme, the
Company is committed to export prescribed times of the value of
import of raw materials over a specified period of time. In case such
commitments are not met, the Company would be required to pay
the duty saved along with interest to the regulatory authorities.
During the year, the company has executed bonds for an aggregate
amount of H 26.16 crore (Previous Year H 19.73 crore) in favour of
The President of India under sub section (I) of the section 142 of the
Custom Act 1962 for fulfilment of the obligation under the said Act.

## Obligations relates to import of goods at concessional rates
of duty (IGCR) for manufacturing finished goods for Export and
Domestic sales. In case such commitments are not met, the Company
would be required to pay the duty saved along with interest to the
regulatory authorities. During the year, the company has executed
bonds for an aggregate amount of H 21.50 Crore (previous Year
H 17.65 Crore) in favour of The President of India under sub section
(I) of the section 142 of the Custom Act 1962 for fulfilment of the
obligation under the said Act.

* During the previous year Income tax department raised a demand
for Rs 2.27 Crore related to AY 2020-21 which is adjusted with refund
for AY 2023-24 of Rs 1.71 Crore. During the current year Income tax
department revised the demand related to AY 2020-21 to Rs.2.06
Crore and balance amount of Rs.0.35 Crore has been adjusted fully
against the refund of AY 2024-25.

The Company is subject to legal proceedings and claims, which
have arisen in the ordinary course of business. The Company's
management reasonably expects that these legal actions, when
ultimately concluded and determined, will not have a material
and adverse effect on the Company's results of operations or
financial condition.

The Company has other commitments for purchase/sale orders which
are issued after considering requirements as per the operating cycle
for purchase/sale of goods and services, and employee benefits. The
Company does not have any long term commitment or material non
cancellable contractual commitments/contracts which might have
a material impact on the standalone Ind AS financial statements
of the Company.

xii) Actuarial risks 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 follows:

a) Salary increases - Actual salary increases will increase the
Plan's liability. Increase in salary increase rate assumption
in future valuations will also increase the liability.

b) Investment risk - If plan is funded then assets liabilities
mismatch and actual investment return on assets lower
than the discount rate assumed at the last valuation date
can impact the liability.

c) Discount rate- Reduction in discount rate in subsequent
valuations can increase the plan's liability.

d) Mortality and disability - Actual death and 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
withdrawals rates at subsequent valuations can impact
Plan's liability.

B Contribution to Provident Fund

The company has recognized an expense of H 10.67 crore
(Previous year H 9.81 crore) in respect of contribution to
Provident Fund.

37 Disclosures as required by Indian Accounting
Standard (Ind AS) 116 Leases

Company as a Lessee

The Company's significant leasing arrangements are in respect
of operating leases for premises (residential, etc.). These leasing
arrangements, which are non-cancellable and are usually
renewable by mutual consent on mutually agreeable terms.

The Company does not face a significant liquidity risk with
regard to its lease liabilities as the current assets are sufficient
to meet the obligations related to lease liabilities as and
when they fall due.

The changes in the carrying value of ROU assets for the year
ended 31-Mar-2025 are as follows :

39 Segment information
I Segment Accounting Policies:

a. Products and services from which reportable segment derive their revenues.

Based on the nature and class of product and services, their customers and assessment of differential risk and returns and financial
reporting results reviewed by Chief Operating Decision Maker (CODM), the company has identified the primary business segments
which comprised:

The "Chemical" segment produces and sells Ethyl Acetate, Iso Butyl Benzene, Acetyl Chloride, Mono Chloro Acetic Acid, Acetic
Anhydride, etc.

The "Pharmaceutical" segment produces and sells various API's viz. Ibuprofen, Metformin, Fenofibrate, Lamotrigine, Clopidogrel
Bisulphate, Pantoprazole, Ursodeoxycholic Acid (UDCA), Gabapentin, Levetiracetam, Paracetamol, etc.

The operating businesses are organized and managed separately according to the nature of the products produced, with each segment
representing a strategic business unit that offers different products and serves different markets.

b. Geographical segments - Secondary segments

The geographical segments considered for disclosure are based on markets, as under:

i. India

ii. Rest of the world

c. Segment accounting policies:

In addition to the significant accounting policies applicable to the business, the accounting policies in relation to segment
accounting are as under:

i. Segment assets and liabilities:

Segment assets include all operating assets used by a segment and consists principally of cash, debtors, inventories and fixed
assets, net of allowances and provisions, which are reported as direct off set in the balance sheet. Segment liabilities include all
operating liabilities and consist principally of creditors and accrued liabilities.

ii. Segment revenue and expenses:

Joint revenue and expenses of segment are allocated amongst them on reasonable basis. All other segment revenue and expenses
are directly attributable to the segments.

(i) The transactions with related parties are made in the ordinary course of business and on terms equivalent to those that prevail in arm's
length transactions with other vendors. Outstanding balances at the year-end is unsecured and settlement occurs in cash.

(ii) *Long-term employee benefits for Key Managerial Persons:

The managerial personnel are covered by Company's gratuity policy and are eligible for compensated absences along with other
employees of the Company. The proportionate amount of gratuity and compensated absences cost pertaining to managerial
remuneration have not been included in aforementioned disclosures as these are not determined on individual basis.

(iii) Related party M/s.NCVI Enterprises Limited has given corporate surety during the current year Rs.21.50 Crore (previous Year Rs.17.65
Crore) on Bonds executed by the company for import of raw materials at concessional rates of duty for producing finished goods for
Export and Domestic sales. Pending remaining amount of commitment is Rs.4.69 Crore as on 31-Mar-2025 and Rs.3.17 Crore as on 31-
Mar-2024 for production/sale of finished goods against import of raw materials received on these Bonds.

41 Financial Risk Management

The financial assets of the company include investments, loans, trade and other receivables, and cash and bank balances that derive directly
from its operations. The financial liabilities of the company, other than derivatives, include loans and borrowings, trade payables, lease liabilities
and other payables, and the main purpose of these financial liabilities is to finance the day to day operations of the company.

The company is mainly exposed to the following risks that arise from financial instruments:

(i) Market risk

(ii) Liquidity risk

(iii) Credit risk

The Company's senior management oversees the management of these risks and that advises on financial risks and the appropriate financial
risk governance framework for the Company.

This note explains the risks which the company is exposed to and policies and framework adopted by the company to manage these risks:

(i) 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 comprise two types of risk: foreign currency risk and interest rate risk.

(a) Foreign currency risk

The company imports certain Property, Plant and Equipment and material from outside India and export finished goods. The
exchange rate between the Indian rupee and foreign currencies has fluctuated in recent years and may fluctuate substantially in
the future. Consequently the company is exposed to foreign currency risk and the results of the company may be affected as the
rupee appreciates/ depreciates against foreign currencies. Foreign exchange risk arises from the future probable transactions and
recognized assets and liabilities denominated in a currency other than company's functional currency.

The company measures the risk through a forecast of highly probable foreign currency cash flows and manages its foreign currency
risk by hedging appropriately. The company manages its foreign currency risk through the process of adjusting inward remittances
in foreign currency for its payment of outward remittances (i.e. considering it as natural hedge). The Company also holds derivative
financial instruments such as foreign exchange forward contracts to mitigate the risk of changes in exchange rates on foreign
currency exposures.

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 with floating interest rates.

As the Company has no significant interest-bearing assets, the
income and operating cash flows are substantially independent
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 with floating interest rates,
which are included in interest bearing loans and borrowings in
these financial statements if any. All the company's fixed rate
borrowings are carried at amortised cost. They are therefore
not subject to interest rate risk, since neither the carrying
amount nor the future cash flows will fluctuate because of a
change in market interest rates.

At the reporting date the interest rate profile of the Company's
interest bearing financial instrument is at its fair value:

Liquidity risk refers to the risk that the Company will encounter
difficulty to meet its financial obligations. The objective of
liquidity risk management is to maintain sufficient liquidity
and ensure that funds are available for use as per requirements.

The financial liabilities of the company include loans and
borrowings, trade and other payables. The company's principal
sources of liquidity are cash and cash equivalents and the cash
flow that is generated from operations.

The company monitors its risk of shortage of funds to meet the
financial liabilities using a liquidity planning tool. The company
plans to maintain sufficient cash to meet the obligations as and
when falls due.

The below is the detail of contractual maturities of the financial
liabilities of the company at the end of each reporting period:

Credit risk refers to the risk of default on its contractual terms
or obligations by the counterparty resulting in a financial loss.
The maximum exposure to the credit risk at the reporting
date is primarily from trade receivables which are typically
unsecured. Credit risk on cash and bank balances is limited
as the company generally invests in deposits with banks and
financial institutions with high credit ratings assigned by credit
rating agencies.

The company assesses the creditworthiness of the customers
internally to whom goods are sold on credit terms in the
normal course of business. The credit limit of each customer is
defined in accordance with this assessment

The impairment analysis is performed on client to client basis
for the debtors that are past due at the end of each reporting
date. The company has not considered an allowance for
doubtful debts in case of Trade receivables that are past due
but there has not been a significant change in the credit quality
and the amounts are still considered recoverable.

Write off policy

The financials assets are written off in case there is no reasonable
expectation of recovering from the financial asset.

42 Capital Management

The capital includes issued equity capital, share premium and all 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.

Further, there have been no breaches in the financial covenants of
any interest-bearing loans and borrowing in the current period.

There were no changes in the objectives, policies or processes
for managing capital during the year ended 31-Mar-2025
and 31-Mar-2024.

43 In accordance with the Ind AS-36 on Impairment of Assets, the
Company has assessed as on the balance sheet date, whether
there are any indications with regard to the impairment of any
of the assets. Based on such assessment it has been ascertained
that no potential loss is present and therefore, formal estimate
of recoverable amount has not been made. Accordingly no
impairment loss has been provided in the books of account

44 Reconciliation of Cash flow from financing
Activities

In pursuant to amendment in the companies (Indian Accounting
Standards) Rules, 2017 via MCA notification G.S.R 258(E) dated
17-Mar-2017 Para 44A to Para 44E has been inserted after Para
44 in Indian accounting Standard-7 ” Statement of Cash Flows"
for the period beginning on 1-April-2017

[1] The shortfall amount is on account of funds that are allocated
to the ongoing projects initiated during the current year and
being unspent as at 31-Mar-2025 has been transferred to the
unspent CSR account within 30 days from the end of financial
year in accordance with the Companies Act 2013, read with
Companies (Corporate Social Responsibility Policy) Rules, 2014.

The company has deposited H 0.56 crore in unspent CSR
account on 29th April 2025 relating to shortfall for FY 2024-25,
which will be spent in coming years on ongoing projects.

[2] Represents contribution to lOL-Foundation for Company's CSR
projects as per Company's CSR Policy.

[3] The excess amount of H 1.24 crore spent during the year
2023-24 by the Company have been set off against the CSR
expenditure of the current financial year.

[4] During the current year, the company also incurred an
expenditure of H 0.30 crore on ongoing projects for the
FY 2021-22 and H 0.67 crore on ongoing projects for
the FY 2022-23.

48 Additional Regulatory Information

i The Company is holding title deed of all Immovable Properties
held in its own name.

ii The Company is not holding any investment property.

iii The Company has not revalued any of its Property, Plant &
Equipment and Right of use assets.

iv The Company has not revalued any of its Intangible Assets

v The Company has not given any loan or advances to its
Promoters, Directors, KMP and related Parties as defined under
Companies Act, 2013.

vi The Company does not hold any Benami property defined under
the Benami Transactions (Prohibition) Act, 1988 (as amended
in 2016) and rules made thereunder. Further, no proceedings
have been initiated during the year or are pending against the
Company as at 31-Mar-2025 for holding any benami property.

vii The quarterly returns for secured borrowings filed with Banks
are fully in alignment with its Financial Statements.

viii The Company has never been declared as wilful defaulter by
any bank or financial institution or other lenders.

ix The company doesnot have any relationship with any
struck off company.

x All the charges are duly registered with the ROC within the prescribed
time under the Companies Act 2013 & Rules made there under.

xi As at 31-Mar-2025, the Company have wholly owned subsidiary
companies i.e. IOL-Foundation, IOL Speciality Chemicals Ltd.
and IOL Life Sciences Limited. The Company is in compliances
of requirement of number of layer of companies.

xii There is no scheme of Arrangement approved during the year.

xiii The company has neither received any share premium amount
nor the company has availed any term loan during the year. The
working capital borrowing has been utilised by the company in
its own business, the company has not loaned or advanced or
invested funds to any other person(s) or entity(ies), including
foreign entities with any understanding.

xiv The company has not traded or invested in Crypto currency or
Virtual currency during the financial year.

xv There is no income that has been surrendered or disclosed
as income during the year in Tax Assessments under
Income Tax Act,1961.

50 The company has complied with the provisions of Section 186(4) of the companies act, 2013 in respect of investments made
(refer note no:5).

51 Fig ures in bracket indicate deductions.

52 Previous year figures have been regrouped/recasted/rearranged wherever necessary to conform to its classification of the current year.

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

For Ashwani & Associates

Chartered Accountants

Firm Registration Number: 000497N

Sd/- Sd/- Sd/-

Aditya Kumar Varinder Gupta Vikas Gupta

Partner Managing Director Joint Managing Director

M.No. 506955 DIN-00044068 DIN-07198109

Sd/- Sd/-

Place : Ludhiana Abhay Raj Singh Pardeep Kumar Khanna

Date : 16-May-2025 Sr. VP & Company Secretary Chief Financial Officer