2.10 Provisions and contingencies

Provisions

Provisions are recognised only when:

(i) the Company has a present obligation (legal or
constructive) as a result of past event;

(ii) i t is probable that an outflow of resources embodying
economic benefits will be required to settle the
obligation; and

(iii) a reliable estimate can be made of the amount of 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 recognised as a finance cost.

These estimates are reviewed at each reporting date and
adjusted to reflect the current best estimates.

Contingent liabilities

A contingent liability is a possible obligation that arises
from past events whose existence will be confirmed
by the occurrence or non-occurrence of one or more
uncertain future events beyond the control of the
company or a present obligation that is not recognised
because it is not probable that an outflow of resources
will be required to settle the obligation. A contingent
liability also arises in extremely rare cases where

there is a liability that cannot be recognised because
it cannot be measured reliably. The Company does
not recognize a contingent liability but discloses its
existence in the financial statements.

2.11 Employee benefits

i. Short-term obligations

Liabilities for wages and salaries, including non-monetary
benefits that are expected to be settled wholly within twelve
months after the end of the period in which the employees
render the related service are recognised in respect of
employee service upto the end of the reporting period and
are measured at the amount expected to be paid when the
liabilities are settled. The liabilities are presented as current
employee benefit obligations in the balance sheet.

ii. Long-term employee benefit obligations

Gratuity

Gratuity liability is defined benefit obligation and is provided
for on the basis of an actuarial valuation on projected unit
credit (PUC) method made at the end of each financial
year. The Company's gratuity fund scheme is managed
by trust maintained with Insurance companies to cover the
gratuity liability of the employees and premium paid to such
insurance companies is charged to the statement of profit
and loss.

Net interest is calculated by applying the discount rate to
the net balance of the defined benefit obligation and the fair
value of plan assets. The Company recognises the following
changes in the net defined benefit obligation as an expense
in the statement of profit and loss:

- service costs comprising current service costs, past-
service costs, gains and losses on curtailments and
non-routine settlements

- net interest expense or income
Re-measurement gains and losses arising from experience
adjustments and changes in actuarial assumptions are
recognised in the period in which they occur, directly in
other comprehensive income. They are included in retained
earnings in the statement of changes in equity and in the
balance sheet. Re-measurements are not reclassified to
profit or loss in the subsequent periods.

Provident fund and Superannuation fund

The Company's contributions to defined contribution plans
(provident fund, ESI, superannuation fund) are recognized
in profit or loss when the employee renders related service.
The Company has no further obligations under these plans
beyond its periodic contributions.

Compensated absences

Accumulated leaves, which are expected to be utilized within
the next 12 months, are treated as short-term employee
benefits. The Company measures the expected cost of such
absences as the additional amount that it expects to pay as

a result of the unused entitlement that has accumulated at
the reporting date.

The Company treats accumulated leaves expected to
be carried forward beyond twelve months, as long-term
employee benefit for measurement purposes. Such long¬
term compensated absences are provided for based on the
actuarial valuation using the projected unit credit method at
the year-end. Actuarial gains/losses are immediately taken
to the Statement of Profit and Loss and are not deferred.
The Company presents the leave as a current liability in the
balance sheet, to the extent it does not have an unconditional
right to defer its settlement for 12 months after the reporting
date. Where the Company has the unconditional legal and
contractual right to defer the settlement for a period beyond
12 months, the same is presented as non-current liability.

iii. Share based payments

Equity-settled transactions

Employees (including senior executives) of the Company
receive remuneration from the ultimate holding company
in the form of share-based payments, whereby employees
render services as consideration for equity instruments
(equity-settled transactions).

The cost of equity-settled transactions is determined by
the fair value at the date when the grant is made using an
appropriate valuation model.

That cost is recognised as employee benefits expense in
the statement of profit and loss over the period in which
the performance and/or service conditions are fulfilled.
The cumulative expense recognised for equity settled
transactions at each reporting date until the vesting date
reflects the extent to which the vesting period has expired
and the Company's best estimate of the number of equity
instruments that will ultimately vest. The statement of profit
and loss expense or credit for a period represents the
movement in cumulative expense recognised as at the
beginning and end of that period and is recognised in
employee benefits expense.

Service and non-market performance conditions are not
taken into account when determining the grant date fair
value of awards, but the likelihood of the conditions being
met is assessed as part of the Company's best estimate
of the number of equity instruments that will ultimately
vest. Market performance conditions are reflected within
the grant date fair value. Any other conditions attached to
an award, but without an associated service requirement,
are considered to be non-vesting conditions. Non-vesting
conditions are reflected in the fair value of an award and
lead to an immediate expensing of an award unless there
are also service and/or performance conditions.

No expense is recognised for awards that do not ultimately
vest because non-market performance and/or service
conditions have not been met. Where awards include a

market or non-vesting condition, the transactions are treated
as vested irrespective of whether the market or non-vesting
condition is satisfied, provided that all other performance
and/or service conditions are satisfied.

When the terms of an equity-settled award are modified,
the minimum expense recognised is the expense had the
terms had not been modified, if the original terms of the
award are met. An additional expense is recognised for any
modification that increases the total fair value of the share-
based payment transaction or is otherwise beneficial to the
employee as measured at the date of modification. Where
an award is cancelled by the entity or by the counterparty,
any remaining element of the fair value of the award is
expensed immediately through profit or loss.

2.12 Financial instruments

A financial instrument is any contract that gives rise to a
financial asset of one entity and a financial liability or equity
instrument of another entity. Financial assets and financial
liabilities are recognised when the Company becomes a
party to the contractual provisions of the instrument.

i. Financial assets

Initial recognition and measurement
All financial assets are recognised initially at fair value plus,
in the case of financial assets not recorded at fair value
through profit or loss, transaction costs that are attributable
to the acquisition of the financial asset. However, trade
receivables that do not contain a significant financing
component are measured at transaction price.

Subsequent measurement

For purpose of subsequent measurement, financial assets
are measured at:

- amortised cost

- fair value through other comprehensive income
(FVTOCI)

- fair value through statement of profit and loss (FVTPL)
Where financial assets are measured at fair value, gains
and losses are either recognised entirely in the statement
of profit and loss (i.e. fair value through profit or loss) or
recognised in other comprehensive income (i.e. fair value
through other comprehensive income).

Financial assets at amortized cost

A ‘debt instrument' is measured at the amortised cost if both
the following conditions are met:

a) The asset is held within a business model whose
objective is to hold assets for collecting contractual
cash flows, and

b) Contractual terms of the asset give rise on specified
dates to cash flows that are solely payments of
principal and interest (SPPI) on the principal amount
outstanding.

After initial measurement, such financial assets are
subsequently measured at amortized cost using the effective
interest rate (EIR) method. Amortised cost is calculated by
taking into account any discount or premium on acquisition
and fees or costs that are an integral part of EIR. EIR is
the rate that exactly discounts the estimated future cash
receipts over the expected life of the financial instrument or
a shorter period, where appropriate, to the gross carrying
amount of the financial asset. When calculating the effective
interest rate, the Company estimates the expected cash
flows by considering all the contractual terms of the financial
instrument but does not consider the expected credit losses.
The EIR amortization is included in finance income in profit
or loss. The losses arising from impairment are recognised
in the profit or loss. This category generally applies to trade
and other receivables.

Financial assets at fair value through other comprehensive
income (FVTOCI)

A financial asset is measured at fair value through other
comprehensive income if following criteria are met:

a) The objective of the business model is achieved both
by collecting contractual cash flows and selling the
financial assets, and

b) The asset's contractual cash flows represent SPPI.
Financial assets included within the FVTOCI category are
measured initially as well as at each reporting date at fair
value. Fair value movements are recognised in the other
comprehensive income (OCI), except for the recognition
of interest income, impairment gains or losses and foreign
exchange gains or losses which are recognised in statement
of profit and loss. On derecognition of asset, cumulative
gain or loss previously recognised in OCI is reclassified from
the equity to statement of profit and loss. Interest earned
whilst holding FVTOCI financial asset is reported as interest
income using the EIR method.

Financial assets at FVTPL

FVTPL is a residual category for financial instruments. Any
financial instrument, which does not meet the criteria for
amortized cost or FVTOCI, is classified as at FVTPL.

In addition, the Company may elect to designate a
financial instrument, which otherwise meets amortized
cost or FVTOCI 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 instruments included within the FVTPL category
are measured at fair value with all changes recognised in
the statement of profit and loss.

Derecognition

A financial asset (or, where applicable, a part of a financial
asset or part of a Company of similar financial assets) is

primarily derecognised (i.e. removed from the Company's
statement of financial position) when:

- t he 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.

Impairment of financial assets

In accordance with IND AS 109, the Company applies
expected credit losses (ECL) model for measurement and
recognition of impairment loss on the following financial
assets and credit risk exposure:

- Financial assets measured at amortized cost;

- Financial assets measured at fair value through other
comprehensive income (FVTOCI);

The Company follows ‘simplified approach' for recognition of
impairment loss allowance on trade receivables or contract
revenue receivables. The application of simplified approach
does not require the Company to track changes in credit
risk. Rather, it recognises impairment loss allowance based
on lifetime ECLs at each reporting date, right from its initial
recognition.

For recognition of impairment loss on other financial assets
and risk exposure, the Company determines whether there
has been a significant increase in the credit risk since initial
recognition. If credit risk has not increased significantly,
12-month ECL is used to provide for impairment loss.
However, if credit risk has increased significantly, lifetime
ECL is used. If, in subsequent period, credit quality of the
instrument improves such that there is no longer a significant
increase in credit risk since initial recognition, then the
Company reverts to recognizing impairment loss allowance
based on 12- months ECL.

ECL is the difference between all contractual cash flows that
are due to the Company in accordance with the contract
and all the cash flows that the entity expects to receive (i.e.,
all cash shortfalls), discounted at the original EIR.

The Company uses a provision matrix to determine
impairment loss allowance on the portfolio of trade
receivables. The provision matrix is based on its historically
observed default rates over the expected life of trade
receivable and is adjusted for forward looking estimates.
At every reporting date, the historical observed default rates
are updated and changes in the forward-looking estimates
are analysed.

ii. Financial liabilities:

Initial recognition and measurement
Financial liabilities are classified at initial recognition as
financial liabilities at fair value through profit or loss, loans
and borrowings, payables, or as derivatives designated as
hedging instruments in an effective hedge, as appropriate.
All financial liabilities are recognised initially at fair value
and, in the case of loans and borrowings and payables, net
of directly attributable transaction costs.

The Company's financial liabilities include borrowings, lease
liabilities, trade and other payables.

Subsequent Measurement

For the purpose of subsequent measurement, financial
liabilities are classified in two categories:

- Financial Liabilities at fair value through profit or loss

- Financial Liabilities at amortised cost (loan and
borrowings)

Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include
financial liabilities held for trading and financial liabilities
designated upon initial recognition as at fair value through
profit or loss. Financial liabilities are classified as held for
trading if they are incurred for the purpose of repurchasing
in the near term.

Gains or losses on liabilities held for trading are recognised
in the statement of profit and loss.

Financial liabilities designated upon initial recognition at fair
value through profit or loss are designated as such at the
initial date of recognition, and only if the criteria in IND AS
109 are satisfied. For liabilities designated as FVTPL, fair
value gains/ losses attributable to changes in own credit
risk are recognised in OCI. These gains/ losses are not
subsequently transferred to profit and loss. However, the
Company may transfer the cumulative gain or loss within
equity. All other changes in fair value of such liability are
recognised in the statement of profit and loss. The Company
has not designated any financial liability as at fair value
through profit and loss.

Financial liabilities at amortised cost (Loans and borrowings)
Borrowings are initially recognised at fair value, net of
transaction cost incurred. After initial recognition, interest¬
bearing loans and borrowings are subsequently measured at
amortized cost using the EIR method. Gains and losses are
recognised in statement of profit and loss when the liabilities
are derecognised as well as through the EIR amortization
process. 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 amortization is
included as finance costs in the statement of profit and loss.

Trade payables

These amounts represent liabilities for goods and services
provided to the Company prior to the end of financial year
which are unpaid. Trade and other payables are presented
as current liabilities unless payment is not due within 12
months after the reporting period. They are recognised
initially at fair value and subsequently measured at amortized
cost using EIR method.

Derecognition

A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another
from the same lender on substantially different terms, or the
terms of an existing liability are substantially modified, such
an exchange or modification is treated as the derecognition
of the original liability and the recognition of a new liability.
The difference in the respective carrying amounts is
recognised in the statement of profit or loss.

Offsetting of financial instruments:

Financials assets and financial liabilities are offset and the
net amount is reported in the balance sheet if there is a
currently enforceable legal right to offset the recognised
amounts and there is an intention to settle on a net basis,
to realize the assets and settle the liabilities simultaneously

2.13 Cash and Cash Equivalents

Cash and cash equivalents in the balance sheet comprise
cash at banks and on hand and short-term deposits with an
original maturity of three months or less, which are subject
to insignificant risk of changes in value.

2.14 Leases

The Company assesses at contract inception whether a
contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified asset
for a period of time in exchange for consideration.

Where the Company is lessee

(i) Right to use assets

The Company assesses whether a contract contains a
lease, at inception of a contract. A contract is, or contains,
a lease if the contract conveys the right to control the use
of an identified asset for a period of time in exchange for
consideration.

At the date of commencement of the lease, the Company
recognizes a right-of-use asset (“ROU”) and a corresponding
lease liability for all lease arrangements in which it is a
lessee, except for leases with a term of twelve months or
less (short-term leases) and low value leases. For these
short-term and low value leases, the Company recognizes
the lease payments as an operating expense.

Certain lease arrangements include the options to extend or
terminate the lease before the end of the lease term. ROU
assets and lease liabilities includes these options when it is
reasonably certain that they will be exercised.

The right-of-use assets are initially recognized at cost, which
comprises the initial amount of the lease liability adjusted for
any lease payments made at or prior to the commencement
date of the lease plus any initial direct costs less any lease
incentives. They are subsequently measured at cost less
accumulated depreciation and impairment losses, if any.
Right-of-use assets are depreciated from the commencement
date on a straight-line basis over the shorter of the lease
term and the estimated useful lives of the assets, as follows:

If ownership of the leased asset transfers to the Company
at the end of the lease term or the cost reflects the exercise
of a purchase option, depreciation is calculated using the
estimated useful life of the asset.

Right of use assets are evaluated for recoverability whenever
events or changes in circumstances indicate that their
carrying amounts may not be recoverable. For the purpose
of impairment testing, the recoverable amount (i.e. the
higher of the fair value less cost to sell and the value-in-use)
is determined on an individual asset basis unless the asset
does not generate cash flows that are largely independent
of those from other assets. In such cases, the recoverable
amount is determined for the Cash Generating Unit (CGU)
to which the asset belongs.

(ii) Lease liabilities

The lease liability is initially measured at amortized cost
at the present value of the future lease payments. The
lease payments are discounted using the interest rate
implicit in the lease or, if not readily determinable, using
the incremental borrowing rates in the country of domicile
of these leases. Lease liabilities are remeasured with a
corresponding adjustment to the related right of use asset
if the Company changes its assessment if whether it will
exercise an extension or a termination option.

Lease liability and ROU asset have been separately
presented in the balance sheet and lease payments have
been classified as financing cash flows.

2.15 Earnings per share

Basic earnings per share are calculated by dividing
the net profit or loss for the period attributable to equity
shareholders by the weighted average number of equity
shares outstanding during the year.

Diluted earnings per share are calculated by dividing
the net profit or loss for the period attributable to equity
shareholders by the weighted average number of shares
outstanding during the year as adjusted for the effect of all
potentially dilutive equity shares.

2.16 Use of estimates

The Company is required to make estimates and
assumptions that affect the reported amounts of assets,
liabilities, disclosure of contingent liabilities at the date
of the financial statements and the reported amounts of
revenue and expenses during the reporting period. Actual
results could differ from those estimates. The Company
bases its estimates on historical experience and on various
other assumptions that are believed to be reasonable, the
results of which form the basis for making judgements about
carrying values of assets and liabilities.

2.17 Exceptional items

The Company recognises exceptional item when items of
income and expenses within Statement of Profit and Loss
from ordinary activities are of such size, nature or incidence
that their disclosure is relevant to explain the performance
of the Company for the year.

2.18 Inventories

i. Raw materials, components, stores and spares are
valued at lower of cost and net realisable value after
providing cost of obsolescence, if any. However,
materials and other items held for use in the production
of inventories are not written down below cost if the
finished products in which they will be incorporated
are expected to be sold at or above cost. Cost of
raw materials, components and stores and spares is
determined on a weighted average basis.

ii. Work in progress and finished goods are valued at lower
of cost and net realizable value. Cost includes direct
materials and labour and proportion of manufacturing
overheads based on normal operating capacity. Cost
is determined on a weighted average basis.

iii. Traded goods are valued at lower of cost and net
realizable value. Cost includes cost of purchase and
other costs in bringing the inventories to their present
location and condition. Cost is determined on weighted
average basis.

iv. Net realizable value is the estimated selling price in
the ordinary course of business, less estimated costs
of completion and estimated costs necessary to make
the sale.

v. Stores and spares which do not meet the definition
of property, plant and equipment are accounted as
inventories.

2.19 Derivative financial instruments and hedge
accounting

The Company uses derivative financial instruments to
hedge its foreign currency and commodity risks. Derivatives
are measured at fair value. At the inception of the hedge
relationship, the entity documents the relationship between
the hedging instrument and the hedged item, along
with its risk management objectives and its strategy for
undertaking various hedge transactions. Furthermore, at
the inception of the hedge and on an ongoing basis, the
Company documents whether the hedging instrument is
highly effective in offsetting changes in fair values of the
hedged item attributable to the hedged risk.

The treatment of changes in the value of derivative depends
on their use as explained below:

Cash flow hedges: Derivatives are held to hedge the
uncertainty in timing or amount of future forecast cash
flows. Such derivatives are classified as being part of cash
flow hedge relationships. For an effective hedge, gains
and losses from changes in the fair value of derivatives are
recognised in other comprehensive income. Any ineffective
elements of the hedge are recognised in the statement of
profit and loss.

If the hedged cash flow relates to a non-financial asset, the
amount accumulated in equity is subsequently included
within the carrying value of that asset. For other cash flow
hedges, amounts accumulated in other comprehensive
income are taken to the statement of profit and loss at the
same time as the related cash flow.

When a derivative no longer qualifies for hedge accounting,
any cumulative gain or loss remains in equity until the related
cash flow occurs. When the cash flow takes place, the
cumulative gain or loss is taken to the statement of profit
and loss. If the hedged cash flow is no longer expected to
occur, the cumulative gain or loss is taken to the statement
of profit and loss immediately.

Fair value hedges: The Company designates certain
hedging instruments, which include derivatives, in respect
of foreign currency risk, as fair value hedges. Hedges of
foreign exchange risk on firm commitments are accounted
for as fair value hedge.

Changes in fair value of the designated portion of derivatives
that qualify as fair value hedges are recognised in profit or
loss immediately, together with any changes in the fair value
of the hedged asset or liability that are attributable to the
hedged risk. The change in the fair value of the designated
portion of hedging instrument and the change in the hedged
item attributable to the hedged risk are recognised in profit
or loss in the line item relating to the hedged item. Hedge
accounting is discontinued when the hedging instrument
expires or is sold, terminated, or exercised, or when it
no longer qualifies for hedge accounting. The fair value

adjustment to the carrying amount of the hedged item
arising from the hedged risk is amortised to profit or loss
from that date.

2.20 Borrowings

Borrowings are initially recognised at fair value, net of
transaction costs incurred. Borrowings are subsequently
measured at amortised cost. Any difference between the
proceeds (net of transaction costs) and the redemption
amount is recognised in profit or loss over the period of the
borrowings using the effective interest method. Fees paid
on the establishment of loan facilities are recognised as
transaction costs of the loan to the extent that it is probable
that some or all of the facility will be drawn down. In this
case, the fee is deferred until the draw-down occurs. To the
extent there is no evidence that it is probable that some or
all of the facility will be drawn down, the fee is capitalised
as a prepayment for liquidity services and amortised over
the period of the facility to which it relates.

Borrowings are classified as current liabilities unless the
company has an unconditional right to defer settlement
of the liability for at least 12 months after the reporting
period. 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.

2.21 Fair value measurement

The Company measures financial instruments at fair value
at each balance sheet date.

Fair value is the price 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. The
fair value measurement is based on the presumption that
the transaction to sell the asset or transfer the liability takes
place either:

- In the principal market for asset or liability, or

- I n the absence of a principal market, in the most
advantageous market for the asset or liability.

The principal or the most advantageous market must be
accessible by the Company.

The fair value of an asset or liability is measured using
the assumptions that market participants would use
when pricing the asset or liability, assuming that market
participants act in their economic best interest.

A fair value measurement of a non- financial asset takes into
account a market participant's ability to generate economic
benefits by using the asset in its highest and best use or by

selling it to another market participant that would use the
asset in its highest and best use.

The Company uses valuation techniques that are
appropriate in the circumstances and for which sufficient
data are available to measure fair value, maximising the
use of relevant observable inputs and minimizing the use of
unobservable inputs.

All assets and liabilities for which fair value is measured
or disclosed in the financial statements 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) market prices in active markets
for identical assets or liabilities

Level 2- Valuation techniques for which the lowest level input
that is significant to the fair value measurement is directly or
indirectly observable

Level 3- Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.

For assets and liabilities that are recognised in the financial
statements on a recurring basis, the Company determines
whether transfers have occurred between levels in the
hierarchy by re-assessing categorization (based on the
lowest level input that is significant to fair value measurement
as a whole) at the end of each reporting period.

For the purpose of fair value disclosures, the Company has
determined classes of assets and liabilities on the basis of
the nature, characteristics and risks of the asset or liability
and the level of the fair value hierarchy as explained above.

2.22 Preference Shares

Preference shares are separated into liability and equity
components based on the terms of the contract. On
issuance of the preference shares, the fair value of the
liability component is determined using an incremental
borrowing rate of the Company. This liability is classified
as financial liability measured at amortised cost (net of
transaction costs) until it is extinguished on redemption.

The remainder of the proceeds is allocated to the conversion
option that is recognised and included in equity net of tax
effect. The carrying amount of the conversion option is not
remeasured in subsequent years.

2.23 Significant accounting judgements, estimates and
assumptions

The preparation of the Company's financial statements
requires management to make judgements, estimates and
assumptions that affect the reported amounts of revenues,
expenses, assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent liabilities.
Uncertainty about these judgement, assumptions and

estimates could result in outcomes that require a material
adjustment to the carrying amount of the asset or liability
affected in future periods.

Judgements

In the process of applying the Company's accounting
policies, management has made the following judgements,
which have the most significant effect on the amounts
recognised in the financial statements.

Leases

The Company determines the lease term as the non¬
cancellable term of the lease, together with any periods
covered by an option to extend the lease if it is reasonably
certain to be exercised, or any periods covered by an option
to terminate the lease, if it is reasonably certain not to be
exercised. The Company has several lease contracts that
include extension and termination options. The Company
applies judgement in evaluating whether it is reasonably
certain whether or not to exercise the option to renew or
terminate the lease. That is, it considers all relevant factors
that create an economic incentive for it to exercise either the
renewal or termination. After the commencement date, the
Company reassesses the lease term if there is a significant
event or change in circumstances that is within its control
and affects its ability to exercise or not to exercise the option
to renew or to terminate.

Estimates and assumptions

The key assumptions concerning the future and other key
sources of estimation uncertainty at the reporting date, that
have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial year, are described below. The Company based its
assumptions and estimates on parameters available when the
financial statements were prepared. Existing circumstances
and assumptions about future developments, however, may
change due to market changes or circumstances arising
beyond the control of the Company. Such changes are
reflected in the assumptions when they occur.

(a) Taxes

Uncertainties exist with respect to the interpretation of
complex tax regulations, changes in tax laws, and the
amount and timing of future taxable income. Given the wide
range of business relationships and the long-term nature and
complexity of existing contractual agreements, differences
arising between the actual results and the assumptions
made, or future changes to such assumptions, could
necessitate future adjustments to tax income and expense
already recorded. the Company establishes provisions,
based on reasonable estimates. The amount of such
provisions is based on various factors, such as experience
of previous tax audits and differing interpretations of tax
regulations by the taxable entity and the responsible tax
authority.

Such differences of interpretation may arise on a wide
variety of issues depending on the conditions prevailing in
the respective domicile of the companies.

(b) Gratuity benefit

The cost of defined benefit plans (i.e. Gratuity benefit) is
determined using actuarial valuations. An actuarial valuation
involves making various assumptions which may differ
from actual developments in the future. These include the
determination of the discount rate, future salary increases,
mortality rates and future pension increases. Due to the
complexity of the valuation, the underlying assumptions
and its long-term nature, a defined benefit obligation
is highly sensitive to changes in these assumptions.
All assumptions are reviewed at each reporting date. In
determining the appropriate discount rate, management
considers the interest rates of long-term government bonds
with extrapolated maturity corresponding to the expected
duration of the defined benefit obligation. The mortality
rate is based on publicly available mortality tables for the
specific countries. Future salary increases and pension
increases are based on expected future inflation rates for the
respective countries. Further details about the assumptions
used, including a sensitivity analysis, are given in note 31.

(c) Fair value measurement of financial instrument

When the fair value of financial assets and financial liabilities
recorded in the balance sheet cannot be measured based on
quoted prices in active markets, their fair value is measured
using valuation techniques including the Discounted Cash
Flow (DCF) model. The inputs to these models are taken from
observable markets where possible, but where this is not
feasible, a degree of judgement is required in establishing
fair values. Judgements include considerations of inputs
such as liquidity risk, credit risk and volatility. Changes in
assumptions about these factors could affect the reported
fair value of financial instruments.

(d) Provision for expected credit losses of trade receivables
and contract assets

The Company uses a provision matrix to calculate ECLs
for trade receivables and contract assets. The provision
rates are based on days past due for groupings of various
customer segments that have similar loss patterns (i.e.,
by geography, product type, customer type and rating,
and coverage by letters of credit and other forms of credit
insurance).

The provision matrix is initially based on the Company's
historical observed default rates. The Company will calibrate
the matrix to adjust the historical credit loss experience

with forward-looking information. For instance, if forecast
economic conditions (i.e., gross domestic product) are
expected to deteriorate over the next year which can lead
to an increased number of defaults in the manufacturing
sector, the historical default rates are adjusted. At every
reporting date, the historical observed default rates are
updated and changes in the forward-looking estimates are
analysed.

The assessment of the correlation between historical
observed default rates, forecast economic conditions
and ECLs is a significant estimate. The amount of ECLs
is sensitive to changes in circumstances and of forecast
economic conditions. The Company's historical credit loss
experience and forecast of economic conditions may also
not be representative of customer's actual default in the
future. The information about the ECLs on the Company's
trade receivables and contract assets is disclosed in Note
38.

(e) Warranty provision

Warranty Provisions are measured at discounted present
value using pre-tax discount rate that reflects the current
market assessments of the time value of money and the risks
specific to the liability. Warranty provisions is determined
based on the historical percentage of warranty expense to
sales for the same types of goods for which the warranty
is currently being determined. The same percentage to
the sales is applied for the current accounting period to
derive the warranty expense to be accrued. It is adjusted to
account for unusual factors related to the goods that were
sold, such as defective inventory lying at the depots. It is
very unlikely that actual warranty claims will exactly match
the historical warranty percentage, so such estimates are
reviewed annually for any material changes in assumptions
and likelihood of occurrence.

(f) Restructuring provisions

Restructuring provisions are recognised only when the
Company has a constructive obligation, which is when a
detailed formal plan identifies the business or part of the
business concerned, the location and number of employees
affected, a detailed estimate of the associate costs, and an
appropriate timeline, and the employees affected have been
notified of the plan's main features.

(g) Provision for litigations

A provision is recognised when the Company has a present
obligation as result of a past event and it is probable that the
outflow of resources will be required to settle the obligation,
in respect of which a reliable estimate can be made. These

(i) Revenue rom contracts with customers
The percentage-of-completion (POC) method places
considerable importance on accurate estimates to the
extent of progress towards completion and may involve
estimates on the scope of deliveries and services required
for fulfilling the contractually defined obligations. These
significant estimates include total contract costs, total
contract revenues, contract risks, including technical,
political and regulatory risks, and other judgments. The
Company re-assesses these estimates on periodic basis
and makes appropriate revisions accordingly.

Description of nature and purpose of each reserve

Equity component of preference shares - The equity component of preference shares has been measured as the
difference between the carrying value and the fair value of the preference shares.

Equity component of inter corporate deposits - The equity component of inter corporate deposits has been measured
as the difference between the carrying value of the borrowing and the fair value of the borrowing.

Share based payments reserve - The fair value of the equity-settled share based payment transactions is recognised
in Statement of Profit and Loss with corresponding credit to share based payments reserve.

Capital reserve - The Company had acquired the distribution business of erstwhile Areva T&D India Limited, now GE
Vernova T&D India Limited through a Scheme of arrangement for demerger. At that time, the excess of net assets
acquired, over the cost of consideration paid was treated as capital reserve.

General reserve - The Company had acquired the distribution business of erstwhile Areva T&D India Limited, now
GE Vernova T&D India Limited through a Scheme of arrangement for demerger. The general reserve was transferred
from the demerged Company to the tune of '14,948 lakhs. Further, the Company had transferred general reserve from
surplus balance in the statement of profit and loss to the tune of ' 398 lakhs.

Retained Earnings - Retained earnings are the profits that the Company has earned till date, less any transfers to
general reserve, dividends or other distributions paid to shareholders.

j) The Company's best estimate of expense for the next annual reporting period is ' 582 lakhs (March 31, 2024:
' 557 lakhs)

k) Expected contribution for the next year is ' 481 lakhs.

l) Salary increase rate takes into account of inflation, seniority, promotion and other relevant factors on long term
basis.

m) The discount rate is based upon the market yields available on Government bonds at the accounting date with a
term that matches that of the liabilities.

n) The sensitivity analysis above have been determined based on a method that extrapolates the impact on defined
benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting
period.

o) 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- 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 deaths 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 withdrawal
rates at subsequent valuations can impact Plan's liability.

33 LEASES

As a lessee

The Company has lease contracts for various properties (e.g. sales office, Warehouse, leasehold land, buildings etc.)
used in its operations. Leases of property other than leasehold land and building generally have lease terms upto 20
years. The Company's obligations under its leases are secured by the lessor's title to the leased assets. Generally, the
Company is restricted from assigning and subleasing the leased assets.

The Company also has certain leases of property and machinery with lease terms of 12 months or less and leases of
office equipment with low value. The Company applies the ‘short-term lease' and ‘lease of low-value assets' recognition
exemptions for these leases.

d) The Company had total cash outflows for leases of ' 1,155 lakhs during the year ended March 31,2025 ( March
31,2024: ' 442 lakhs).

The Company also had non-cash additions as at March 31, 2025 to right-of-use assets of ' 1,912 lakhs ( March
31,2024 : ' 7,169 lakhs) and lease liabilities of ' 1,912 lakhs (March 31,2024: ' 7,169 lakhs).

e) The Company has several lease contracts that include extension and termination options. These options are
negotiated by management to provide flexibility in managing the leased-asset portfolio and align with the
Company's business needs. Management exercises significant judgement in determining whether these extension
and termination options are reasonably certain to be exercised.

A.2 Indirect Tax cases [Mixed cases with GE Vernova T&D India Limited (formerly Alstom T&D India Limited)]

Post demerger, Company and GE Vernova T&D India Limited (formerly Alstom T&D India Limited) have bifurcated the
total outstanding demands of Excise/ Service Tax and Sales tax in accordance with the arrangement agreed between
the two Companies (mixed cases). Accordingly, GE is contesting the total outstanding demands, before various
appellate authorities, including the share of the Company.

35 RELATED PARTY TRANSACTIONS (CONTD.)

2. In addition to the above transactions, Schneider Electric Industries SAS, France (the ultimate holding company)
has given letter of comfort to banks of the Company based on which banks have given unsecured loan facilities
(at the prevailing interest rate) to the Company. This letter is not intended as a legal guarantee on the part of the
ultimate holding company.

3. The Company has cash pooling arrangement with Schneider Electric IT Business India Private Limited, India,
(SEITB), a fellow subsidiary, under which the Company's banker automatically transfers funds from SEITB to the
Company's bank account in case of requirement of fund at the end of each day up to the approved limits. The
details are as below:

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

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

1. The fair values of the interest-bearing borrowings and loans are determined by using Discounted cashflow method
(DCF) using discount rate that reflects the Company's borrowing rate as at the end of the reporting period. The
own non-performance risk as at March 31,2025 was assessed to be insignificant.

2. Long-term receivables/payables are evaluated by the Company based on parameters such as interest rates, risk
factors, individual creditworthiness of the counterparty and the risk characteristics of the financed project. Based
on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

Fair value hierarchy

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by
valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities

Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value are observable,
either directly or indirectly

Level 3: techniques that use inputs that have a significant effect on the recorded fair value that are not based on
observable market data

38 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company's principal financial liabilities comprise loans and borrowings, trade and other payables. The main
purpose of these financial liabilities is to finance the Company's operations. The Company's principal financial assets
include loans, trade and other receivables and cash and bank balances that are derived directly from its operations.

The Company's financial risk management is an integral part of how to plan and execute its business strategies. The
Company is exposed to market risk, credit risk and liquidity risk.

The Company's senior management oversees the management of these risks and also ensure that the Company's
financial risk activities are governed by appropriate policies and procedures and that financial risks are identified,
measured and managed in accordance with the Company's policies and risk objectives.

The Board of Directors reviews and agrees policies for managing each of these risks which are summarized as below:
(a) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes
in market prices. Market prices comprises three types of risk: currency rate risk, interest rate risk and other price risks,
such as equity price risk and commodity price risk. Financial instruments affected by market risks include loans and
borrowings, deposits and foreign currency receivables and payables. The sensitivity analysis in the following sections
relate to the position as at March 31 2025. The sensitivity of the relevant Profit and Loss item is the effect of the assumed
changes in the respective market risks. This is based on the financial assets and financial liabilities held as of March
31,2025

(i) Foreign Currency Risk

Foreign currency 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. The Company's exposure to the risk of changes in foreign exchange rates
relates primarily to the Company's operating activities (when revenue or expense is denominated in foreign currency).
Foreign currency exchange rate exposure is partly balanced by purchasing of goods from the respective countries.
The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established
risk management policies.

Foreign currency risk sensitivity

The following tables demonstrate the sensitivity to a reasonably possible change in USD, EUR and other exchange
rates, with all other variables held constant. The impact on the Company profit before tax is due to changes in the fair
value of monetary assets and liabilities. Foreign currency exposures recognised by the Company that have not been
hedged by a derivative instrument or otherwise are as under:

(ii) Interest Rate Risk

Interest rate is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes
in market interest rates. The Company's exposure to the risk of changes in market interest rates relates primarily to the
Company's long term debt obligation at floating interest rates. The Company's borrowings outstanding as at March
31,2025 comprise of fixed rate loans and accordingly, are not exposed to risk of fluctuation in market interest rate.

(iii) Commodity Price Risk

The Company is affected by the price volatility of certain commodities. Its operating activities require manufacturing,
designing, building and servicing technologically advanced products and systems for electricity distribution including
products such as distribution transformers, medium voltage switchgears, medium and low voltage protection relays
and electricity distribution and automation equipment. It therefore require a continuous supply of copper and Aluminium
being the major input used in the manufacturing. Due to the significantly increased volatility of the price of the Copper
and aluminium, the Company has entered into various purchase contracts for these material for which there is an
active market. The Company maintain the level of these stock as per the requirement of business and market which
are discussed by the management on regular basis. Company operates in the way that saving / impact due to change
in commodity prices are pass on to the customer and therefore impact on profit due to change in price of commodity
is unascertainable.

(b) Credit Risk

Credit Risk is the risk that the counter party will not meet its obligation under a financial instrument or customer
contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade
receivables) and from its financing activities, including deposits with banks, foreign exchange transactions and other
financial instruments.

(i) Trade Receivables

Customer credit risk is managed by each business unit subject to the Company's established policy, procedures and
control relating to customer credit risk management.

An impairment analysis is performed at each reporting date on trade receivables by lifetime expected credit loss
method based on provision matrix. The maximum exposure to credit risk at the reporting date is the carrying value
of each class of financial assets. The Company does not hold collateral as security. The Company evaluates the
concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and
industries and operate in largely independent markets.

(ii) Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company's treasury department in
accordance with the Company's policy. Investments of surplus funds are made in the risk free bank deposits. The limits
are set to minimize the concentration of risks and therefore mitigate financial loss through counter party's potential
failure to make payments.

The Company's maximum exposure to credit risk for the components of the balance sheet at March 31, 2025 and
March 31,2024 is the carrying amounts . Trade Receivables and other financial assets are written off when there is no
reasonable expectation of recovery, such as debtor failing to engage in the repayment plan with the Company. The
Company's maximum exposure relating to financial assets is noted in liquidity table below.

39 CAPITAL MANAGEMENT

For the purposes of Company's capital management, Capital includes equity attributable to the equity holders of the
Company and all other equity reserves. The primary objective of the Company's capital management is to ensure that
it maintains an efficient capital structure and maximize 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. To
maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders or issue new
shares. The Company is not subject to any externally imposed capital requirements. No changes were made in the
objectives, policies or processes for managing capital during the year ended March 31,2025 and March 31,2024.

41 REVENUE FROM CONTRACTS WITH CUSTOMERS- IND AS 115 (CONTD.)

41.4 Performance obligation:

Information about the Company's performance obligations are summarised below:

Sale of goods

The performance obligation is satisfied upon delivery of the goods.

Services

The Performance obligation is satisfied at point of time upon completion of service and pro-rata over the period of
contract as and when service is rendered.

Long term Contract

The performance obligation is satisfied over a period of time. The Company uses cost based input method for measuring
progress for performance obligation satisfied over time.

42 CORPORATE SOCIAL RESPONSIBILITY

As per provisions of section 135 of the Companies Act, 2013, the Company has to incur at least 2% of average net profits
of the preceding three financial years towards Corporate Social Responsibility (“CSR”). Accordingly, a CSR committee
has been formed for carrying out CSR activities as per the Schedule VII of the Companies Act, 2013. The Company
has contributed and paid a sum of ' 303 lakhs (March 31,2024: ' 144 lakhs) towards this cause and debited the same
to the Statement of Profit And Loss. The funds are primary allocated to Schneider Electric India foundation (SEIF),
a society registered under section 12A of the Income Tax Act, 1961 for promoting social integration and vocational
training of disadvantaged youths and electrification of remote villages with limited resources.

43 As per the Transfer Pricing Rules of the Income Tax Act, 1961 every company is required to get a transfer pricing study
conducted to determine whether the transactions with associated enterprises were undertaken at an arm's length basis
for each financial year end. Transfer pricing study for the transaction pertaining to the year ended March 31,2025 is
currently in progress and hence adjustments if any which may arise there from have not been taken into account in
these financial statements for the year ended March 31,2025 and will be effective in the financial statements for the year
ended March 31,2024. However, in the opinion of the Company's management, adjustments, if any, are not expected
to be material.

45 ADDITIONAL REGULATORY INFORMATION REQUIRED BY SCHEDULE III OF COMPANIES ACT, 2013

(i) Details of Benami property: No proceedings have been initiated or are pending against the Company for holding
any Benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made
thereunder.

(ii) Utilisation of borrowed funds and share premium: The Company has not advanced or loaned or invested funds
to any other person(s) or entity(is), 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

The Company has not received any fund from any person(s) or entity(is), 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

(iii) Compliance with number of layers of companies: The Company has complied with the number of layers prescribed
under the Companies Act, 2013.

(iv) Compliance with approved scheme(s) of arrangements: The Company has not entered into any scheme of
arrangement which has an accounting impact on current or previous financial year.

(v) Undisclosed income: 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.

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

(vii) The Company has not granted any loans or advances in the nature of loans either repayable on demand or without
specifying any terms or period of repayment.

(viii) Valuation of Property Plant & Equipment and intangible asset: The Company has not revalued its property, plant
and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

(ix) The Company has not been declared as a Willful Defaulter by any bank or financial institution or government or
any government authority

46 As per the MCA notification dated August 05, 2022, the Central Government has notified the Companies (Accounts)
Fourth Amendment Rules, 2022. As per the amended rules, the companies are required to maintain back-up of the
books of account and other relevant books and papers in electronic mode that should be accessible in India at all the
time. Also, the companies are required to create backup of accounts on servers physically located in India on daily
basis. The Company maintains its books of accounts and other relevant records and papers electronically. Effective
March 17, 2025, daily backups of all such electronic records are stored on servers physically located in India. An
exception is made for the Blackline ERP system, whose backup is securely maintained on server outside India and
remain readily accessible to the Company and its officers in India at all times.

47 The figures have been rounded off to the nearest lakhs of rupees. The figure 0 wherever stated represents value less
than ' 50,000/-.

48 The comparative figures have been regrouped/ rearranged wherever considered necessary to make them comparable
with current year numbers.

As per our report of even date attached

For S.N. Dhawan & CO LLP For and on behalf of Board of Directors of

Chartered Accountants Schneider Electric Infrastructure Limited

Firm Registration No.: 000050N/N500045

Udai Singh Deepak Sharma

Managing Director & CEO Director

DIN : 10311583 DIN : 10059493

Date: May 26, 2025 Date: May 26, 2025

Place: Mumbai Place: Gurugram

Pankaj Walia Suparna Banerjee Bhattacharyya Sumit Goel

Partner Chief Financial Officer Company Secretary

Membership No : 509590 PAN : AFCPB4588D FCS 6661

Date: May 26, 2025 Date: May 26, 2025 Date: May 26, 2025

Place: Gurugram Place: Gurugram Place: Gurugram