(iii) Terms/right attached to equity shares

The Company has one class of shares having a face value of ' 5/- per equity share. The Company declares and pay dividends in indian rupees. The dividend proposed by the board of directors is subject to the approvals of the shareholders in ensuing Annual General Meeting. Each holders of equity shares is entitled to one vote per equity share held in the Company. On winding up of the Company, the holders of equity shares will be entitled to receive the residual assets of the Company, remaining after distribution of all preferential amounts in proportion to the number of equity shares held.

(iv) Shares Split & Bonus Issue

Aggregate number of equity shares issued as bonus, shares issued for consideration other than cash and shares bought back during the period of five years immediately preceding the reporting date. Pursuant to a resolution passed by our Board on 6^th September, 2021 and a resolution of shareholders dated, 30^th September, 2021, each equity share of face value of ' 10 each has been split into two equity shares of face

value of ' 5 each. Accordingly, the issued, subscribed and paid up capital of the Company was subdivided from 68,06,700 equity shares of face value of ' 10 each to 1,36,13,400 equity shares of face value of ' 5 each. The Board of Directors pursuant to a resolution dated 6^th September, 2021 and the shareholders special resolution dated 30^th September, 2021 have approved the issuance of two bonus equity shares of face value ' 5 each for every one existing fully paid up equity share of face value ' 5 each and accordingly 2,72,26,800 bonus equity shares were issued and allotted in accordance with the Section 63 of the Companies Act, 2013."

Nature and Purpose of Reserve

a. Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

b. General reserve is the free reserve created out of the retained earnings of the Company. The reserve can be utilised in accordance with the provision of the Companies Act, 2013.

c. 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. Retained earnings include re-measurement loss / (gain) on defined benefit plans, net of taxes that will not be reclassified to Statement of Profit and Loss.

a) Term Loans is secured by way of first pari passu charge over entire movable Property Plant and Equipment of the Company and immovable Property Plant and Equipment of the Company by equitable mortgage of properties situated at Ghaziabad and Goa. These are further secured by second pari passu charge on entire current assets of the Company and personal guarantee of the four Directors of the Company. This facility has been closed during F.Y. 2023-24.

a. Working Capital loan of Company is secured by exclusive first pari passu charge on entire stock of Raw material, Work-in-Progress, Finished Goods, Consumable Stores, Book Debts and other current assets of the Company, both present and future. These loans are further secured by second pari passu charge over the entire movable Property Plant and Equipment of the Company, other and immovable Property Plant and Equipment of the Company by equitable mortgage of properties situated at Ghaziabad and Goa and personal guarantee of the four Directors of the Company.

b. The Company has availed working capital loan from HDFC Bank, CITI Bank and ICICI bank is repayable on demand bearing a floating interest rate on HDFC Loan 3 Month Tbill 1.76% (Effective Rate 8.79%), Interest rate on ICICI Bank Loan 3M MCLR Spread @0.05% (Effective Rate 8.70%) and Fixed interest rate on CITI Bank loan @ 8.85%.

c. For details regarding repayment terms, interest rate and nature of security on current maturities of non current borrowings (Note 21 (a) and (b)).

d. The Company has satisfied all the covenants prescribed in terms of borrowings.

e. The Company has not defaulted on any loans payable.

*Revenue from sale of goods is recognized on transfer of control of goods to the buyer. Revenue is measured at the price charged to the customer and are recorded net of returns (if any), trade discounts, rebates, other pricing allowances to trade/consumer, when it is probable that the associated economic benefits will flow to the Company. Accumulated experience is used to estimate the accruals and provisions for discounts and rebates.

The performance obligation in contracts is considered as fulfilled in accordance with the terms agreed with the respective customers, which is mainly upon arrival at the customer.

Revenue from sale of goods is presented net of Goods and Services Tax (GST).

J DISCLOSURE WITH RESPECT TO IND AS 116 - LEASES Company as a leasee

The Company has lease contracts for serveral industrial lands. These lease arrangements ranges for a period between 48 years to 96 years and includes escalation clause. The Company also has leases for warehouse premises with lease terms of 12 months or less and leases of low value. The Company has applied the 'short term lease' and 'lease of low-value-assets' recognition exemption for these leases.

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. Such lease liabilities are related to Leasehold lands having maturity period of more than 5 year. The maturities analysis of lease liabilities is disclosed in Note 45. Lease liability has been discounted using the lessee's incremental borrowing rate. There are no variable lease payments.

The effective interest rate for lease liabilities is 8% and 8.75%, with maturity between 2059 to 2111.

The table below provides details regarding amounts recognized in the Standalone Statement of Profit and Loss:

b) Defined Benefit Plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service get a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service or part thereon in excess of 6 months. The Company makes contributions to the Elin Employees Company Gratuity Trust. The Trustees of Elin Employees Company Gratuity Trust are responsible for the overall governance of the plan and to act in accordance with the provisions of the trust deed and the relevant provisions prescribed under the law. The Company aims to keep annual contributions to the trust relatively stable at a level such that no significant gap arises between plan assets and liabilities.

The employees' gratuity fund scheme is managed by Kotak Mahindra Life Insurance Limited, Bajaj Allianz Life Insurance Co. Ltd, Tata Aia Life Insurance Co Ltd and Reliance Nippon Life Insurance Co. Ltd. which is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

The employees' leave-encahment scheme is managed by HDFC Life Insurance Company Limited which is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method and is recognised on the basis of eligible leave balances of employees' as on valuation date.

Notes:

i) The Company's pending litigations comprise of claims against the Company and proceedings pending with Government Authorities. The Company has reviewed all its pending litigations and proceedings and believes that they have sufficient and strong arguments on facts as well as on point of law and accordingly no provision has been considered in the financial statements. The Company does not expect the outcome of these proceedings to have a material impact on its financial position.

ii) The Company periodically reviews all its long term contracts to assess for any material foreseeable losses. Based on such review wherever applicable, The Company has made adequate provisions for these long term contracts in the books of account as required under any applicable law/accounting standard.

iii) The Company does not have outstanding term derivative contracts as at the end of respective years.

iv) There were no amounts which were required to be transferred to the investor Education and Protection fund by the Company at the end of respective years.

40 The Code on Social Security, 2020 ('Code') relating to employee benefits during employment and post employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. Certain sections of the Code came into effect on 3^rd May, 2023. However the final rules/interpretation have not yet been issued. Based on a preliminary assessment, the entity believes the impact of the change will not be significant.

41.1 Capital expenditure incurred on R&D is included in the Property Plant and Equipment and depreciation is provided on the same at respective applicable rates.

41.2 Revenue expenditure incurred on R&D has been shown under respective Expense head in the Statement of Profit and loss.

* Liability for post employment benefits, other long term benefits, termination benefits and certain short term benefits such as compensated absences and Gratuity is provided on an actuarial basis for the Company as a whole. Accordingly the amount for above pertaining to key management personnel is not ascertainable and, therefore, not included above.

The transactions for the year do not include reimbursement of IPO related expenses and its outstanding payable balances, incurred on behalf of related parties as selling shareholders in Offer for Sale. Refer note 51 of the financial statements for detailed note on IPO and expenses incurred by the Company and allocated to selling shareholders.

Terms and conditions of transactions with related parties :

- The transaction with related parties are made on terms equivalent to those that prevail in arm's length transactions. There have been no guarantees provided or received for any related party receivables or payables. For the year ended 31^st March, 2024, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (31^st March, 2023: ' Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

^ SEGMENT REPORTING

The Company is engaged in manufacturing of Electronics Manufacturing items. The Board of directors of Elin Electronics Limited takes decision in respect of allocation of resources and assesses the performance basis the reports/ information provided by functional heads and is thus considered to be Chief Operating Decision Maker. During the year under consideration, the Company operated in a single primery segment in manufacturing of Electronics Manufacturing Services.

The said treatment is in accordance with the guiding principles enacted in Indian Accounting Standard 108 Operating Segments (IND AS 108). Accordingly the Company has disclosed segment information for its secondary segment which is the geographical segment as below:

Geographical Information

Accordingly the Company has disclosed segment information

The geographical information analyses the Company's revenues by the Company's country of domicile (i.e. India) and other countries. In presenting the geographical information, segment revenue has been based on the geographic location of customers. The following is the distribution of the Company's consolidated revenues and receivables by geographical market, regardless of where the goods were produced:

*The revenue information above is based on the locations of the customers.

**Non-current assets for this purpose consist of property, plant and equipment, right-of-use assets, capital work-inprogress, capital advances and intangible assets.

c. Information about major customers (from external customers)

Revenue of approximately ' 3,542 Millions 42% (FY 2022-2023: ' 3,930 Millions 45%) are derived from 2 Nos. (FY 20222023: 2 Nos.) external customers which individually accounted for more than 10%.

j FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

The Company's principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables and lease liabilities. The main purpose of these financial liabilities is to finance the Company's operations. The Company's principal financial assets include cash and cash equivalents, trade and other receivables that derive directly from its operations.

The Company's business activities expose it to a variety of financial risks, namely liquidity risk, market risks and credit risk. The management has the overall responsibility for the establishment and oversight of the Company's risk management framework. The Company has constituted a Risk Management Committee, which is responsible for developing and monitoring the Company's risk management policies. The Company's risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company's activities.

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, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes in to account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these Standalone financial statements is determined on such a basis that are within the scope of Ind AS 102, leasing transactions that are within the scope of Ind AS 116, and measurements that have some similarities to fair value but are not fair value, such as net realizable value in Ind AS 2 or value in use in Ind AS 36.

In addition, for financial reporting purposes, fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurements in its entirety, which are described as follows:

Level I: includes financial instruments measured using quoted prices. This includes mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.

Level II: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the counter derivatives) is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level III: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in level 3.

The Company's management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts 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:

Valuation Process

The finance department of the Company includes a team that performs the valuation of financial assets and liabilities required for financial reporting purposes. Changes in level 2 and 3 fair values are analysed at the end of each reporting period. There are no transfers between levels in the fair value hierarchy during the year.

In determining fair value measurement, the impact of potential climate-related matters, including legislation, which may affect the fair value measurement of assets and liabilities in the financial statements has been considered. These risks in respect of climate-related matters are included as key assumptions where they materially impact the measure of recoverable amount, These assumptions have been included in the cash-flow forecasts in assessing value-in-use amounts.

Significant estimates:

The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. The Company uses its judgement to select a variety of methods and make assumptions that are mainly based on market conditions existing at the end of each reporting period."

45.2 Management of Financial Risk

A. Liquidity risk

Liquidity risk is the risk that the Company will face in meeting its obligations associated with its financial liabilities. The Company's approach to managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses. In doing this, management considers both normal and stressed conditions.

The Company has also entered into supply chain finance arrangement to smoothen the payment process of the suppliers. Although the payment terms are not significantly extended beyond the normal credit terms agreed upon with other suppliers, the arrangement helps in making the cashflows more predictable.

B. Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk. Financial instruments affected by market risk include loans and borrowings, deposits, FVTOCI & FVTPL investments. Market risk comprises three types of risks as follows:

i) 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 is exposed to interest rate risk because funds are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rate.

b. Sensitivity Analysis

The sensitivity analyses below have been determined based on the exposure to interest rates for floating rate liabilities, after the impact of hedge accounting, assuming the amount of the liability outstanding at the year-end was outstanding for the whole year.

ii) Currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure 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 its operating activities (when certain purchases and trade payables are denominated in a foreign currency). The Company is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the US dollar, CNY and JPY. Foreign exchange risk arises from future commercial transactions, recognized assets and liabilities denominated in a currency that is not the Company's functional currency

The Company undertakes transactions denominated in foreign currencies and consequently, exposes to exchange rate fluctuations. The Company does not enter into trade financial instruments including derivate financial instruments for hedging its foreign currency risk. The appropriateness of the risk policy is reviewed periodically with reference to the approved foreign currency risk management policy followed by the Company.

iii) Commodity price risk

Commodity price risk arises from fluctuations in the prices of copper, plastic, and aluminum. The Company has a risk management framework aimed at prudently managing the risks associated with the volatility in commodity prices. The Company has transferred any change in commodity prices to the customer. Therefore, there is no significant impact from changes in commodity prices in profit & loss..

C. Credit Risk

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

Trade Receivables

Customer credit risk is managed by each business unit subject to the Company established policy, procedures and control relating to customer credit risk management. To manage trade receivable, the Company periodically assesses the financial reliability of customers, taking into account the financial conditions, economic trends, analysis of historical bad debts and aging of such receivables. The utilization of credit limits is regularly monitored.

The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 45. 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. An impairment analysis is performed at each reporting date for all customers. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in note 13.

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the management in accordance with the Company's policy. Counterparty credit limits are reviewed by the management on an annual basis, and may be updated throughout the year. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through counterparty's potential failure to make payments.

None of the Company's financial assets are either impaired or past due, and there were no indications that defaults in payment obligations would occur.

J CAPITAL MANAGEMENT

Capital includes issued equity capital and share premium and all other equity reserves attributable to the equity holders. The primary objective of the Company's capital management is to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and Maintain an optimal capital structure to reduce the cost of capital. The capital structure of the Company is based on management's judgement of its strategic and day-to-day needs with a focus on total equity so as to maintain investor and creditors confidence.

The Company monitors its capital using gearing ratio, which is net debt divided to total equity. Net debt includes, interest bearing loans and borrowings less cash and cash equivalents.

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 in the current period.

No changes were made in the objectives, policies or processes for managing capital during the years ended 31^st March, 2024 and 31^st March, 2023.

Earning for Debt Service = Net Profit after taxes Non-cash operating expenses like depreciation and other amortizations Interest other adjustments like loss on sale of Fixed assets etc.

Net Profit after tax" means reported amount of "Profit / (loss) for the period" and it does not include items of other comprehensive income.

Working Capital implies Current Assets less Current Liabilities.

Capital employed refers to sum of tangible net-worth, total debts and deferred tax liability as at close of year.

Net credit purchases = Gross credit purchases - purchase return

Net Debt = Total borrowings including lease liabilities less cash and cash equvalant.

Explanation for variances exceeding 25%

Schedule III requires explanation where the change in the ratio is more than 25% as compared to the preceding year; hence explanation is given only for the said ratios.

a) Current ratio is increased due to pending IPO proceeds in Monitoring Account & Bank Deposits.

b) Debt equity ratio is reduced due to repayment of borrowings as part of utilization of IPO proceeds during the year.

c) Debt service coverage ratio is increased due to repayment of borrowings during the year.

d, i, j) Due to lower profitability, Return on equity, Net Profit and Return on capital employed ratio have declined. k) Return on Investment is increased due to investment in Mutual Fund and Fixed deposit made during the year resulting into higher return compared to last year.

j OTHER STATUTORY INFORMATION

i) The Company does not have any benami property, where any proceeding has been initiated or pending against the Company for holding any benami property.

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

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

(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

iv) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(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.

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

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

vii) The Company is not declared wilful defaulter by and bank or financials institution or lender during the year.

viii) The Company does not have any other charges or satisfaction as on 31^st March, 2024 which is yet to be registered with ROC beyond the statutory period.

ix) Quarterly returns/statements of current assets filed by the Company with banks are generally in agreement with the books of account.

*Note: The bank returns were prepared and filed before the completion of all financial statements closure activities which led to these differences between the final books of accounts and the bank returns which were based on provisional books of accounts.

x) The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was obtained.

(xi) The title deeds of all the immovable properties, (other than immovable properties where the Company is the lessee and the lease agreements are duly executed in favor of the Company) disclosed in the financial statements included in property, plant and equipment and capital work-in progress are held in the name of the Company as at the balance sheet date.

xii) The Company does not have any transactions with companies which are struck off.

| INITIAL PUBLIC OFFERING (IPO)

The Company has completed Initial Public Offer (IPO) of 1,92,30,746 equity shares comprising a fresh issue of 70,85,020 equity shares and offer for sale by selling shareholders of 1,21,45,726 equity shares of face value of ' 5 each at premium of ' 242 per share aggregating to '4,750.00 Million. Pursuant to the IPO, the equity shares of the Company are listed on BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) with effect from 30^th December, 2022.

As on 31^st March, 2023, the Company had incurred ' 266.88 Million as IPO related expenses (incl. provision for certain invoices) and allocated such expenses between the Company ' 98.48 Million and selling shareholders ' 168.40 Million.

Such amounts were allocated based on agreement with selling shareholders and in proportion to the total proceeds from the IPO. The Company's share of expenses of ' 84.37 Million (net of GST credit of ' 14.12 Million) has been adjusted to securities premium. Refer note 20 of the standalone financial statements.

Subsequent to the listing of shares of Company, the IPO related expenses of ' 177.64 Million were recovered from the selling shareholders as per the original estimated expenses mentioned in the prospectus filed with RoC. With the finalization of revised issue expenses as mentioned above, sum of ' 9.24 Million is payable to selling shareholders at the end of the previous year and shown under current liabilities. Refer note 25 of the standalone financial statements.

52 The Company has used an accounting software SAP HANA Web Version - Public Cloud which is operated by a third-party software service provider, for maintaining its books of account. The Company is not maintaining the back-up of books of account in servers physically located in India on a daily basis from 1^st April, 2023 to 31^st March, 2024 in compliance to the Rule 3 of the Companies (Account) Rules, 2014 as backups are performed by the SAP at planned intervals mentioned in the SOC 1 Type 2 for the period 1^st April, 2023 to 30^th September, 2023.

53 The Company has used an accounting software SAP HANA Web Version - Public Cloud which is operated by a third-party software service provider, for maintaining its books of account. Audit trail feature is not covered in SOC 1 Type 2 report for the period 1^st April, 2023 to 30^th September, 2023 to determine whether audit trail feature of the said software was enabled and operated throughout the year for all relevant transactions recorded in the software or whether there were any instances of the audit trail feature being tampered with, in respect of an accounting software where the audit trail has been enabled.