(b) Considering the nature of business of the entity i.e., retailing of electronics, with only a small portion being wholesale sales, majority of the amounts are collected at the time of sales or through financing model and accordingly, the Company measures the expected credit loss of trade receivables based on historical trend, industry practices and the business environment in which the entity operates. Loss rates are based on actual credit loss experience and past trends. Based on the historical data, loss on collection of receivables is not material hence no additional disclosures are presented.

(a) (i) Equity shares issued during the year

During the financial year ended 31^st March 2023, pursuant to the initial public offering of equity shares, the Company received a sum of ' 4,646.02 (net of issue expenses) on issuance of 84,745,762 equity shares of ' 10 each at a premium of ' 49 each. The Company’s equity shares are listed and traded on both the National Stock Exchange of India Limited and BSE Limited.

(b) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of ' 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors, if any, is subject to the approval of the shareholders in the ensuing general meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of equity shares held by the shareholders.

(d) Details of shares issued without payment being received in cash:

During the year ended 31^st March 2019, the Company had issued 300,003,000 equity shares of ' 10 each fully paid up to the partners of the erstwhile partnership firm M/s. Bajaj Electronics pursuant to conversion of the said firm into the Company.

(e) Shareholding of promoters

For the purpose of reporting of the shareholding of promoters, Mr Pavan Kumar Bajaj and Mr Karan Bajaj has been considered as promoters as defined under the Provisions of the Companies Act, 2013. There was change in the promoter holding during the year ended 31^st March 2023 owing to fresh issue of equity shares via IPO as detailed in note 14(a)(i) above. Further, refer table below for details of changes in promoters share holding during the year ended 31^st March 2024.

Nature and purpose of reserves

(a) Retained earnings - Surplus in Statement of Profit and Loss

Surplus in Statement of Profit and Loss represents the profits that the Company has earned till date, less any transfers to general reserve, dividends or other distributions to shareholders.

(b) Securities Premium

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

(c) Other Comprehensive Income

The reserve represents the remeasurement gains arising from the actuarial valuation of the defined benefit obligations of the Company. The remeasurement gains are recognised in other comprehensive income and accumulated under this reserve within equity. The amounts recognised under this reserve are not reclassified to Statement of Profit and Loss.

# Working capital loans from HDFC carries an interest rate of MCLR* 0.75% p.a.(31^st March 2023: MCLR* 0.75% p.a), AXIS Bank carries an interest rate of MCLR* 0.25% p.a.(31^st March 2023: Nil) and ICICI Bank carries an interest rate of MCLR* 0.60% p.a.(31^st March 2023: Nil). Unsecured Loans from IDFC carries a interest rate of 9.50% (31^st March 2023: 9.50%) and BFL carries an interest rate of 12.75% (31^st March 2023: 12.75%).

*Marginal cost of funds based lending rate.

^ Working capital loans from BFL carries an interest rate of Nil. (31^st March 2023: 9.75% p.a)

Note: The aforementioned working capital loans from ICICI Bank Limited and Axis Bank Limited are personally guaranteed by Pavan Kumar Bajaj and Karan Bajaj. Further, the working capital facility availed from HDFC bank is also secured by way of pledge of certain personal properties of Pavan Kumar Bajaj, Karan Bajaj, Renu Bajaj and Astha Bajaj.

(a) Defined contribution plan

The Company contributed ' 38.43 (31^st March 2023: ' 36.06) to provident fund and ' 7.66 (31^st March 2023: ' 7.14) towards employee state insurance fund during the year ended 31^st March 2024.

(b) Defined benefit plan

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Under the gratuity plan, every employee who has completed at least five years of service gets a gratuity on departure @ 15 days of last drawn salary for each completed year of service. The level of benefits provided depends on the member’s length of service and salary at retirement age.

Deferred tax assets and deferred tax liabilities have been offset wherever the Company has a legally enforceable right to set-off current tax assets against current tax liabilities and where the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority.

30 FAIR VALUE MEASUREMENTS

(i) All the financial assets and financial liabilitites of Company are carried at amortised cost, except for Investments in subsidiaries which are carried at cost.

(ii) The management assessed that cash and bank balances, trade receivables, trade payables and other current financial liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

(iii) In respect of fixed rate financial Liabilities, the management has assessed the carrying value of these liabilities approximates to the fair value mainly since the same are short term borrowings which are repayable on demand. Further, disclosure fair value of Lease liabilities are not presented in line with the requirements of Para 29(d) of IND AS 107. In respect of the balance of non-current financial assets and liabilities in the nature of loans and borrowings, the management has assessed the carrying value of these assets and liabilities approximates to the fair value mainly due to the interest rates are at the market rate or linked to market rate, as the case maybe.

31 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company’s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company’s primary risk management focus is to minimise potential adverse effects of market risk on its financial performance. The Company’s risk management assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Board of Directors is responsible for overseeing the Company’s risk assessment and management policies and processes.

(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 risk for the Company comprises primarily of interest risk. Financial instruments affected by market risk include loans and borrowings. The sensitivity analysis in the following sections relate to the position as at 31^st March 2024.

The analysis exclude the impact of movements in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions; and the non-financial assets.

The following assumptions have been made in calculating the sensitivity analysis:

(1) The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31^st March 2024.

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 variable rate borrowing is subject to interest rate risk. Below is the details of exposure to variable rate instruments:

(b) Credit risk

Credit risk is the risk of loss that may arise on outstanding financial instruments when a counterparty defaults on its obligations. The Company’s exposure to credit risk arises primarily from loans extended, security deposits, balances with bankers and trade and other receivables. The Company’s objective is to seek continual revenue growth while minimising losses incurred due to increased credit risk exposure. The credit risk has always been managed by the Company through credit approvals, establishing credit limits, and continuously monitoring the credit worthiness of the customers to whom the Company grants credit terms in the normal course of business. Outstanding customer receivables are regularly monitored.

Exposure to credit risk:

At the end of the reporting year, the Company’s maximum exposure to credit risk is represented by the carrying amount of each class of financial assets recognised in the statement of financial position. No other financial assets carry a significant exposure to credit risk.

Credit risk concentration profile:

At the end of the reporting year, there were no significant concentrations of credit risk. The maximum exposures to credit risk in relation to each class of recognised financial assets is represented by the carrying amount of each financial assets as indicated in the balance sheet.

Financial assets that are neither past due nor impaired:

None of the Company’s cash and bank balances, loans, security deposits were past due or impaired as at 31^st March 2024. Trade and other receivables including’s loans that are neither past due nor impaired are from various individual customers and reputed financial institutions.

Financial assets that are either past due or impaired:

The Company doesn’t have any significant trade receivables or other financial assets which are either past due or impaired. The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, the management also evaluates the factors that may influence the credit risk of its customer base, including the default risk. The management has established a credit policy, procedures and controls relating to customer credit risk management under which each new customer is analysed individually for creditworthiness before the Company’s standard payment and delivery terms and conditions are offered. The Company’s receivables turnover is quick and historically, there was no significant default on account of trade and other receivables. An impairment analysis is performed at each reporting date on an individual basis. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for forward looking information.

Financial instruments and cash deposits

Credit risk from balances with banks is managed by the Company’s finance team in accordance with the Company’s policy. Investments of surplus funds are made only with approved and reputed banks and within credit limits assigned to each bank. The amounts invested and details of relevant banks are reviewed by the Company’s Board of directors on annual basis.

(c) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company’s reputation.

Management monitors rolling forecasts of the Company’s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. This is generally carried out by the Company in accordance with practice and limits set by the management.

(d) Excessive risk concentration

Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Company’s performance to developments affecting a particular industry.

In order to avoid excessive concentrations of risk, the Company’s policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.

32 CAPITAL MANAGEMENT

Capital includes equity and all other reserves attributable to share holders. The primary objective of the capital management is to ensure that it maintains an efficient capital structure and healthy capital ratios in order to support its business and maximise share holders value. The Company manages its capital structure and make adjustments to it, in light of changes in economic conditions or its business requirements.

The Company monitors capital using a gearing ratio, which is net debt divided by equity plus net debt.

The Company includes within net debt, interest bearing loans and borrowings, less cash and bank balances.

In order to achieve this overall objective, the Company’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing for the year ended 31^st March 2024.

There have been no changes made in the objectives, policies or processes for managing capital during the year ended 31^st March 2024.

33 SEGMENT REPORTING

In accordance with Indian Accounting Standard (Ind AS) 108 on “Operating Segments”, segment information has been disclosed in the consolidated financial statements of the Company, and therefore no separate disclosure on segment information is given in these financial statements.

Note:

(i) The Company has received an order from the National Anti-Profiteering Authority of the Central Goods and Services Tax Act, 2017 demanding an amount of ' 3.43 alleging certain non-compliances with the anti-profiteering regulations of the Goods and Services Act, 2017. The management has filed necessary appeals in this regard with the appropriate appellate authorities which is pending for adjudication as at the date of the standalone financial statements. However, on the basis of its internal assessment of the nature of the allegations, the facts of the case and an independent advise received in this regard, management is confident of resolving this matter in favour of the Company.

(ii) The Company has received an order from Director General of GST, Hyderabad demanding an amount of ' 107.26 alleging that the Company has failed to levy GST on receipt of credit notes of certain types issued by its vendors. The management is in process of filing necessary appeals in this regard with the appropriate appellate authorities. However, on the basis of its internal assessment of the nature of the allegations, the facts of the case and an independent advise received in this regard, management is confident of resolving this matter in favour of the Company.

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.

Rental expense recorded for short-term leases was ' 16.21 (31^st March 2023: ' 7.73) for the year ended 31^st March 2024.

The future cash outflows to which the lessee is potentially exposed that are not reflected in the measurement of lease liabilities are -

1) Leases not yet commenced to which the Company is committed amounts to 31^st March 2024: ' 459.45 (31^st March 2023: ' 71.78).

2) Variable lease payments based on sales amounts to 31^st March 2024: ' 1.90 (31^st March 2023: ' 3.62).

@ Excludes interest and depreciation on right-of-use assets and related liabilities.

*Cost of goods sold includes purchases of stock-in-trade and changes in inventories of stock-in-trade.

# capital employed = Total assets - Current liabilities.

Note: Reasons for change in % by more than 25% is as under

(i) Principal reason for change in Debt service coverage ratio is attributed to increase in the profit during the year ended 31^st March 2024.

(ii) Principal reason for change in Net profit ratio is attributed to increase in the margins during the year ended 31^st March 2024.

40 (i) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of

funds) by the Company to or in any other persons or entities, including foreign entities (“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries).

(ii) The Company has not received any fund from any party (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

41 The Ministry of Corporate Affairs (MCA) has prescribed a new requirement for companies under the proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 inserted by the Companies (Accounts) Amendment Rules 2021 requiring companies, which uses accounting software for maintaining its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in the books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled.

The Company has used certain accounting software for recording accounting transactions, billing transactions and inventory transactions. The software used for recording acounting transactions did not have a feature of recording audit trail (edit log) facility.

The Company uses another software for maintaining billing records. Audit trail (edit log) is enabled at the application level except that the audit trail (edit log) for changes made to the mode of receipt (tender changes) for the period 01^st March 2024 to 31^st March 2024 is not available. The Company’s users have access to post transactions only at the application level. The Company has not enabled the feature of recording audit trail (edit log) feature at the database level to log any direct data changes.

Further, for the software used for maintaining of inventory transactions and details of wholesale revenue, the feature of recording audit trail (edit log) at the database level was not enabled for the said software to log any direct data changes. Audit trail (edit log) is enabled at the application level, and the Company’s users have access to post transactions only at the application level.

42 ADDITIONAL DISCLOSURES

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

(ii) The Company has not been declared wilful defaulter by any bank or financial Institution or other lender.

(iii) No charges or satisfaction yet to be registered with ROC beyond the statutory period.

(iv) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017.

(v) No Scheme of Arrangements has been approved by the Competent Authority in terms of sections 230 to 237 of the Act.

(vi) There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

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

This is the summary of significant accounting policies and other explanatory information referred to in our report of even date.