2.10 Provisions and Contingent Liabilities

Warranty Provisions

Provision for warranty-related costs are recognised when
the product is sold or service is provided to customer.
Initial recognition is based on historical experience. the
Company periodically reviews the adequacy of product
warranties and adjust warranty percentage and warranty
provisions for actual experience, if necessary. The timing
of outflow is expected to be with in one to seven years.

2.11 Material accounting judgements, estimates
and assumptions

The preparation of these standalone financial statements
requires the management to make judgements, use
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 judgements,
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.

a) 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 material 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 (e.g., construction of material
leasehold improvements or material customisation
to the leased asset).

b) Taxes

Uncertainties exist with respect to the interpretation of
tax regulations, changes in tax laws and the amount
and timing of future taxable income. Given the wide
range of business relationships 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 assessments and differing interpretations of tax
regulations by the taxable entity and the responsible
tax authority. (Refer Note 17)

c) Gratuity benefit and Leave obligation

The cost of defined benefit plans (i.e. Gratuity
benefit) and other long term employee obligations
(i.e Leave obligation) 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 and leave 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 India. Future
salary increases and pension increases are based
on expected future inflation rates for India. Further
details about the assumptions used, including a
sensitivity analysis, are given in Note 33(4).

d) Impairment of non-financial assets

The Company assesses at each reporting date
whether there is an indication that an asset including
intangible assets having indefinite useful life and
goodwill may be impaired. If any indication exists,
or when annual impairment testing for an asset
is required, the Company estimates the asset's
recoverable amount. An assets recoverable amount
is the higher of an asset's CGU'S fair value less cost
of disposal and its value in use. Where the carrying
amount of an asset or CGU exceeds its recoverable
amount, the asset is considered impaired and is
written down to its recoverable amount.

In assessing value in use, the estimated future
cash flows are estimated based on past trend
and discounted to their present value using a
pre-tax discount rate that reflects current market

assessments of the time value of money and the
risks specific to the asset. In determining fair value
less costs of disposal, recent market transactions
are taken into account. If no such transactions can
be identified, an appropriate valuation model is used.
These calculations are corroborated by valuation
multiples, or other fair value indicators.

e) Provision for warranty

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. The warranty claims may not
exactly match the historical warranty percentage,
so such estimates are reviewed annually for any
material changes in assumptions and likelihood of
occurrence. The assumptions are consistent with
prior years. (Refer Note 20)

f) Provision for expected credit losses (ECL) 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. 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 material 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 33(10).

g) Property, Plant and Equipment and intangible
assets

Property, Plant and Equipment represent material
portion of the asset base of the Company. The
charge in respect of periodic depreciation is derived
after determining an estimate of assets expected
useful life and expected value at the end of its useful
life. The useful life and residual value of Company's
assets are determined by Management at the
time asset is acquired and reviewed periodically
including at the end of each year. The useful life is
based on historical experience with similar assets, in
anticipation of future events, which may have impact
on their life such as change in technology.

h) Fair Value on financial instruments

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
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.

2.12 Other accounting policy

This note provides a list of other accounting policies
adopted in the preparation of these standalone financial
statements to the extent they have not already been
disclosed in the other notes above. These polices have
been consistently applied to all the years presented,
unless otherwise stated.

a) Rounding Off

These standalone financial statements are presented
in H and all values are rounded to the nearest crore
(H 0,000,000), except when otherwise indicated.

b) Current versus non-current classification

The Company presents assets and liabilities in
the balance sheet based on current/non- current
classification. An asset is treated as current when it is:

- Expected to be realized or intended to be sold
or consumed in normal operating cycle

- Held primarily for purpose of trading

- Expected to be realized within twelve months
after the reporting period, or

- Does not have the right at the end of the
reporting period to defer settlement of the
liability for at least twelve months after the
reporting period.

All other assets are classified as non-current.

A liability is current when:

- It is expected to be settled in normal
operating cycle

- It is held primarily for purpose of trading

- It is due to be settled within twelve months after
the reporting period, or

- There is no unconditional right to defer the
settlement of the liability for at least twelve
months after the reporting period

All other liabilities are classified as non current.

Deferred tax assets and deferred tax liabilities are
classified as non- current assets and liabilities.

The operating cycle is the time between the acquisition
of assets for processing and their realization in cash
and cash equivalents. the Company has identified
twelve months as its operating cycle.

c) Property Plant and Equipment

The historical cost comprises of purchase price,
taxes, duties, freight and other incidental expenses
directly attributable and related to acquisition and
installation of the concerned assets and are further
adjusted by the amount of input tax credit availed
wherever applicable. Such cost includes the cost
of replacing part of the plant and equipment and
borrowing costs for long-term construction projects
if the recognition criteria are met. When material parts
of plant and equipment are required to be replaced at
intervals, the Company depreciates them separately
based on their specific useful lives. Likewise, when a
major inspection is performed, its cost is recognised
in the carrying amount of the plant and equipment
as a replacement if the recognition criteria are
satisfied. All other repair and maintenance costs are
recognised in profit or loss as incurred. The present
value of the expected cost for the decommissioning
of an asset after its use is included in the cost of
the respective asset if the recognition criteria for a
provision are met.

Subsequent costs are included in asset's carrying
amount or recognised as separate assets, as
appropriate, only when it is probable that future

economic benefit associated with the item will
flow to the Company and the cost of item can be
measured reliably.

An item of property, plant and equipment and any
material part initially recognised is derecognised
upon disposal or when no future economic benefits
are expected from its use or disposal. Any gain or
loss arising on derecognition of the asset (calculated
as the difference between the net disposal proceeds
and the carrying amount of the asset) is included in the
income statement when the asset is derecognised.

Capital work- in- progress includes cost of property,
plant and equipment under installation/under
development as at the balance sheet date. Capital
work in progress is stated at cost, net of accumulated
impairment loss, if any.

The residual values, useful lives and methods of
depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted
prospectively, if appropriate.

d) Intangible assets

Separately acquired intangible assets

Intangible assets acquired separately are measured
on initial recognition at cost. Cost of intangible assets
acquired in business combination is their fair value at
the date of acquisition. Following initial recognition,
intangible assets are carried at cost less accumulated
amortization and accumulated impairment losses,
if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working
condition for its intended use.

The useful lives of intangible assets are assessed
as either finite or indefinite. Intangible assets with
finite lives are amortized over their useful lives and
assessed for impairment whenever there is an
indication that the intangible asset may be impaired.
The amortization period and the amortization method
for an intangible asset with a finite useful life is
reviewed at least at the end of each reporting period.
Changes in the expected useful life or the expected
pattern of consumption of future economic benefits
embodied in the asset is accounted for by changing
the amortization period or method, as appropriate
and are treated as changes in accounting estimates.
The amortization expense on intangible assets
with finite lives is recognised in the statement of
profit and loss.

Intangible assets with indefinite useful lives are not
amortized, but are tested for impairment annually,

either individually or at the cash generating unit level.
The assessment of indefinite life is reviewed annually
to determine whether the indefinite life continues
to be supportable. If not, the change in useful life
from indefinite to finite is made on a prospective
basis. The Company has assessed indefinite life
for such brand considering the expected usage,
expected investment on brand, business forecast
and challenges to establish a premium electronic
segment. These are carried at historical cost and
tested for impairment annually.

Research and development cost

Research costs are expensed as incurred.
Development expenditure incurred on an individual
project is recognised as an intangible asset when the
Company can demonstrate all the following:

i) The technical feasibility of completing the
intangible asset so that it will be available
for use or sale;

ii) Its intention to complete the asset;

iii) Its ability to use or sale the asset;

iv) How the asset will generate future
economic benefits;

v) The availability of adequate resources to
complete the development and to use or
sale the asset; and

vi) The ability to measure reliably the expenditure
attributable to the intangible asset
during development.

Following the initial recognition of the development
expenditure as an asset, the cost model is applied
requiring the asset to be carried at cost less any
accumulated amortization and accumulated
impairment losses. Amortization of the asset begins
when development is complete and the asset
is available for use. It is amortized on straight line
basis over the estimated useful life and is recognised
in the statement of profit and loss . During the
period of development, the asset is tested for
impairment annually.

e) Impairment of non- financial assets

For assets excluding goodwill and intangible assets
having indefinite life, an assessment is made at
each reporting date to determine whether there is
an indication that previously recognised impairment
losses no longer exist or have decreased. If such
indication exists, the Company estimates the

asset's or CGU's recoverable amount. A previously
recognised impairment loss is reversed only if there
has been a change in the assumptions used to
determine the asset's recoverable amount since the
last impairment loss was recognised. The reversal
is limited so that the carrying amount of the asset
does not exceed its recoverable amount, nor
exceed the carrying amount that would have been
determined, net of depreciation, had no impairment
loss been recognised for the asset in prior years.
Such reversal is recognised in the statement of profit
and loss unless the asset is carried at a revalued
amount, in which case, the reversal is treated as a
revaluation increase.

f) 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.

Initial recognition measurement

In order for a financial asset to be classified and
measured at amortised cost or fair value through
OCI, it needs to give rise to cash flows that are
‘solely payments of principal and interest (SPPI)' on
the principal amount outstanding. This assessment
is referred to as the SPPI test and is performed at
an instrument level. Financial assets with cash flows
that are not SPPI are classified and measured at
fair value through profit or loss, irrespective of the
business model.

The Company's business model for managing
financial assets refers to how it manages its financial
assets in order to generate cash flows. The business
model determines whether cash flows will result from
collecting contractual cash flows, selling the financial
assets, or both.

Financial assets classified and measured at
amortised cost are held within a business model
with the objective to hold financial assets in order
to collect contractual cash flows while financial
assets classified and measured at fair value through
OCI are held within a business model with the
objective of both holding to collect contractual cash
flows and selling.

Financial assets at amortised cost
(debt instruments)

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 other 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 OCI
(FVTOCI) (debt instruments)

Debt instrument 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 and computed in the same manner
as for financial assets measured at amortised cost.
The remaining fair value changes are recognised in
OCI. Upon derecognition, the cumulative fair value
changes recognised in OCI is reclassified from the
equity to profit or loss.

Financial assets designated at fair value
through OCI (equity instruments)

Upon initial recognition, the Company can elect
to classify irrevocably its equity investments as
equity instruments designated at fair value through
OCI when they meet the definition of equity under
Ind AS 32 Financial Instruments: Presentation
and are not held for trading. The classification is
determined on an instrument-by-instrument basis.
Equity instruments which are held for trading and
contingent consideration recognised by an acquirer
in a business combination to which Ind AS 103
applies are classified as at FVTPL.

Gains and losses on these financial assets are never
recycled to profit or loss. Dividends are recognised as
other income in the statement of profit and loss when
the right of payment has been established, except
when the Company benefits from such proceeds as
a recovery of part of the cost of the financial asset, in
which case, such gains are recorded in OCI. Equity
instruments designated at fair value through OCI are
not subject to impairment assessment.

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:

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

- The Company has transferred its rights to receive
cash flows from the asset or has assumed an
obligation to pay the received cash flows in full
without material delay to a third party under a “pass
through” arrangement and either;

(a) the Company has transferred substantially all
the risks and rewards of the asset, or

(b) the Company has neither transferred nor
retained substantially all the risks and
rewards of the asset, but has transferred
control of the asset.

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

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

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 asset and credit risk exposure

Financial assets measured at amortized cost;

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

ECLs are based on the difference between the
contractual cash flows due in accordance with

the contract and all the cash flows that the Group
expects to receive, discounted at an approximation
of the original effective interest rate. The expected
cash flows will include cash flows from the sale of
collateral held or other credit enhancements that are
integral to the contractual terms.

ECL impairment loss allowance (or reversal)
recognised during the period is recognised as
income/ expense in the statement of profit and
loss. This amount is reflected under the head ‘other
expenses' in the statement of profit and loss. The
balance sheet presentation for various financial
instruments is described below:

(a) Financial assets measured as at amortised
cost: ECL is presented as an allowance, i.e.,
as an integral part of the measurement of those
assets in the balance sheet. The allowance
reduces the net carrying amount. Until the
asset meets write-off criteria, the Group does
not reduce impairment allowance from the
gross carrying amount.

(b) Loan commitments and financial guarantee
contracts: ECL is presented as a provision in
the balance sheet, i.e. as a liability.

(c) Debt instruments measured at FVTOCI: For
debt instruments measured at FVTOCI, the
expected credit losses do not reduce the
carrying amount in the balance sheet, which
remains at fair value. Instead, an amount
equal to the allowance that would arise if the
asset was measured at amortised cost is
recognised in other comprehensive income as
the accumulated impairment amount.

g) 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 and payables, net of
directly attributable transaction costs. 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
financial liabilities include loans and borrowings,
trade payables, trade deposits, retention money,
liabilities towards services, sales incentive and
other payables.

Subsequent measurement

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

(i) Financial liabilities at fair value through profit or loss

(ii) Financial liabilities at amortised cost (loans
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. This category also includes derivative
financial instruments entered into by the Company
that are not designated as hedging instruments in
hedge relationship as defined by Ind AS 109. The
separated embedded derivate are also classified
as held for trading unless they are designated as
effective hedging instruments.

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/ loss 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 or
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)

After initial recognition, interest-bearing borrowings
are subsequently measured at amortized cost using
the Effective interest rate method. Gains and losses
are recognised in profit or loss when the liabilities
are derecognised as well as through the Effective
interest rate 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 Effective interest rate. The
Effective interest rate amortization is included as
finance costs in the statement of profit and loss.

Trade Payables

These amounts represents liabilities for goods and
services provided to the Company prior to the end

of financial year which are unpaid. The amounts
are unsecured and are usually paid per the term of
contract with suppliers. 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
Effective interest rate method.

Financial guarantee contracts

Financial guarantee contracts issued by the
Company are those contracts that require a payment
to be made to reimburse the holder for a loss it
incurs because the specified debtor fails to make a
payment when due in accordance with the terms of
a debt instrument. Financial guarantee contracts are
recognised initially as a liability at fair value, adjusted
for transaction costs that are directly attributable
to the issuance of the guarantee. Subsequently,
the liability is measured at the higher of the amount
of loss allowance determined as per impairment
requirements of Ind AS 109 and the amount
recognised less cumulative amortization.

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 and 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 realise the assets and settle
the liabilities simultaneously.

Reclassification of financial assets/ financial
liabilities

The Company determines classification of financial
assets and liabilities on initial recognition. After
initial recognition, no reclassification is made for
financial assets which are equity instruments and
financial liabilities. For financial assets which are debt
instruments, a reclassification is made only if there is
a change in the business model for managing those
assets. Changes to the business model are expected
to be infrequent. The Company's senior management

determines change in the business model as a result
of external or internal changes which are material
to the Company's operations. Such changes are
evident to external parties. A change in the business
model occurs when the Company either begins or
ceases to perform an activity that is material to its
operations. If the Company reclassifies financial
assets, it applies the reclassification prospectively
from the reclassification date which is the first day
of the immediately next reporting period following
the change in business model. The Company does
not restate any previously recognised gains, losses
(including impairment gains or losses) or interest.

h) Investment in Subsidiaries and Associates

The investment in subsidiary are carried at cost
as per Ind AS 27. The Company regardless of the
nature of its involvement with an entity (the investee),
determines whether it is a parent by assessing
whether it controls the investee. The Company
controls an investee when it is exposed, or has
rights, to variable returns from its involvement with
the investee and has the ability to affect those
returns through its power over the investee. Thus,
the Company controls an investee if and only if it has
all the following:

(a) power over the investee;

(b) exposure, or rights, to variable returns from its
involvement with the investee and

(c) the ability to use its power over the investee to
affect the amount of the returns.

The company accounted its investment in associate
using equity method as prescribed under Ind AS 28
‘Investments in Associates and Joint Ventures', after
initially being recognised at cost.

Certain investment in associate are classified as a
financial asset measured at amortised cost as:

The asset is held within a business model whose
objective is to hold assets to collect contractual cash
flows and the contractual terms give rise on specified
dates to cash flows that are solely payments of
principal and interest (SPPI) on the principal amount
outstanding.On initial recognition, the investment is
measured at fair value plus transaction costs that are
directly attributable to the acquisition/origination of the
financial asset (where classification is amortised cost).
After initial recognition, the investment is measured
at amortised cost using the effective interest rate
(EIR) method. Interest income is recognised in the

consolidated statement of profit and loss using
the EIR method.

Investments are accounted in accordance
with Ind AS 105 when they are classified as
held for sale. On disposal of investment, the
difference between its carrying amount and net
disposal proceeds is charged or credited to the
statement of profit and loss.

i) Inventory

Basis of valuation:

Inventories other than scrap materials are valued at
lower of cost and net realizable 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. The
comparison of cost and net realizable value is made
on an item-by-item basis.

Inventory of scrap materials have been valued at net
realizable value.

Method of Valuation:

Cost of raw materials has been determined by
using moving weighted average cost method and
comprises all costs of purchase, duties, taxes
(other than those subsequently recoverable from tax
authorities) and all other costs incurred in bringing the
inventories to their present location and condition.

Cost of finished goods and work-in-progress
includes direct labour and an appropriate share
of fixed and variable production overheads. Fixed
production overheads are allocated on the basis
of normal capacity of production facilities. Cost is
determined on moving weighted average basis.

Cost of traded goods has been determined by
using moving weighted average cost method and
comprises all costs of purchase, duties, taxes
(other than those subsequently recoverable from tax
authorities) and all other costs incurred in bringing the
inventories to their present location and condition.

j) Non-current assets held for sale

The Company classifies non-current assets as held
for sale if their carrying amounts will be recovered
principally through a sale rather than through
continuing use and the sale is considered highly
probable. Such non-current assets classified as
held for sale are measured at the lower of their

carrying amount and fair value less costs to sell .
Any expected loss is recognised immediately in the
statement of profit and loss.

The criteria for held for sale classification is regarded
as met only when the assets is available for
immediate sale in its present condition, subject only
to terms that are usual and customary for sales of
such assets, its sale is highly probable; and it will
genuinely be sold. The Company treats sale of the
asset to be highly probable when:

i) The appropriate level of management is
committed to a plan to sell the asset

ii) An active programme to locate a buyer
and complete the plan has been initiated
(if applicable)

iii) The asset is being actively marketed for sale
at a price that is reasonable in relation to its
current fair value

iv) The sale is expected to qualify for recognition
as a completed sale within one year from the
date of classification and

v) Actions required to complete the plan indicate
that it is unlikely that material changes to the plan
will be made or that the plan will be withdrawn.

The criteria for held for sale classification is regarded
as met only when the sale is highly probable and the
asset is available for immediate sale in its present
condition and the assets must have actively marketed
for sale at a price that is reasonable in relation to its
current fair value. Actions required to complete the
sale should indicate that it is unlikely that material
changes to the plan to sale these assets will be
made. Management must be committed to the sale,
which should be expected to qualify for recognition
as a completed sale within one year from the date of
classification.

Property, plant and equipment and intangible assets
once classified as held for sale are not depreciated
or amortized. Assets and liabilities classified as held
for sale are presented separately as current items in
the balance sheet.

k) Income Tax

The income tax expense or credit for the period
is the tax payable on the current period's taxable
income based on the applicable income tax rate
adjusted by changes in deferred tax assets and

liabilities attributable to temporary differences and to
unused tax losses. Income Tax expense for the year
comprises of current tax and deferred tax.

Current income tax

Current income tax, assets and liabilities are measured
at the amount expected to be paid to or recovered
from the taxation authorities in accordance with the
Income Tax Act, 1961 and the Income Computation
and Disclosure Standards (ICDS) enacted in India by
using tax rates and the tax laws that are enacted at
the reporting date.

The current income tax charge is calculated on the
basis of the tax laws enacted or substantively enacted
at the end of the reporting period in the countries
where the company operate and generate taxable
income. Management periodically evaluates positions
taken in tax returns with respect to situations in which
applicable tax regulation is subject to interpretation
and considers whether it is probable that a taxation
authority will accept an uncertain tax treatment. The
company measures its tax balances either based
on the most likely amount or the expected value,
depending on which method provides a better
prediction of the resolution of the uncertainty.

Current income tax relating to item recognised
outside the statement of profit and loss is recognised
outside profit or loss (either in other comprehensive
income or equity).Current tax items are recognised
in correlation to the underlying transactions either in
OCI or directly in equity.

Deferred Tax

Deferred tax is provided in full using the balance
sheet method on temporary differences arising
between the tax bases of assets and liabilities and
their carrying amounts in the financial statements.
However, deferred tax liabilities are not recognised if
they arise from the initial recognition of goodwill.

Deferred tax liabilities are recognised for all taxable
temporary differences, except:

i) When the deferred tax liability arises from the
initial recognition of goodwill or an asset or
liability in a transaction that is not a business
combination and, at the time of the transaction,
affects neither the accounting profit nor
taxable profit or loss

ii) In respect of taxable temporary differences
associated with investments in subsidiaries,
associates and interests in joint ventures, when

the timing of the reversal of the temporary
differences can be controlled and it is probable
that the temporary differences will not reverse in
the foreseeable future

Deferred tax assets are recognised for all deductible
temporary differences, the carry forward of unused
tax credits and any unused tax losses. Deferred tax
assets are recognised to the extent that it is probable
that taxable profit will be available against which
the deductible temporary differences and the carry
forward of unused tax credits and unused tax losses
can be utilised, except:

When the deferred tax asset relating to the
deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that
is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor
taxable profit or loss.

In respect of deductible temporary differences
associated with investments in subsidiaries,
associates and interests in joint ventures, deferred
tax assets are recognised only to the extent that it is
probable that the temporary differences will reverse
in the foreseeable future and taxable profit will be
available against which the temporary differences
can be utilised.

The carrying amount of deferred tax assets is
reviewed at each reporting date and reduced to the
extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of
the deferred tax asset to be utilised. Unrecognised
deferred tax assets are re-assessed at each
reporting date and are recognised to the extent that
it has become probable that future taxable profits will
allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the
tax rates that are expected to apply in the year when
the asset is realized or the liability is settled, based
on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.

Deferred tax relating to items recognised outside the
statement of profit and loss is recognised outside
the statement of profit and loss (either in other
comprehensive income or in equity). Deferred tax
items are recognised in correlation to the underlying
transaction either in OCI or direct in equity.

Tax benefits acquired as part of a business
combination, but not satisfying the criteria for
separate recognition at that date, are recognised

subsequently if new information about facts and
circumstances change. Acquired deferred tax
benefits recognised within the measurement period
reduce goodwill related to that acquisition if they
result from new information obtained about facts and
circumstances existing at the acquisition date. If the
carrying amount of goodwill is zero, any remaining
deferred tax benefits are recognised in OCI/ capital
reserve depending on the principle explained for
bargain purchase gains. All other acquired tax
benefits realized are recognised in profit or loss.

l) Other Operating Revenues

(a) Export benefit

Revenue from export benefits arising from
duty drawback scheme, Remission of duties
and taxes on exported product scheme are
recognised on export of goods in accordance
with their respective underlying scheme at fair
value of consideration received or receivable.

(b) Government Grants

Government Grants are recognised at their fair
value when there is reasonable assurance that
the grant will be received and all the attached
conditions will be complied with.

When the grant relates to an expense item,
it is recognised as income on a systematic
basis over the periods that the related costs,
for which it is intended to compensate, are
expensed. Government grant related to the
non-monetary asset are recognised at nominal
value and presented by deducting the same
from carrying amount of related asset and the
grant is then recognised in profit or loss over
the useful life of the depreciable asset by way
of a reduced depreciation charge.

m) Retirement and other 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) Post employment

a) Gratuity

The Employee's Gratuity Fund Scheme,
which is defined benefit plan, is managed
by Trust with its investments maintained
with Bajaj Life Insurance Limited. The
liabilities with respect to Gratuity Plan
are determined by actuarial valuation
on projected unit credit method on
the balance sheet date, based upon
which the Company contributes to the
Gratuity Scheme. The difference, if any,
between the actuarial valuation of the
gratuity of employees at the year end
and the balance of funds is provided
for as assets/ (liability) in the books. Net
interest is calculated by applying the
discount rate to the net defined benefit
liability or asset. The Company recognises
the following changes in the net defined
benefit obligation under Employee benefit
expense in statement of profit or loss:

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

b) Net interest expense or income

Remeasurements, comprising of actuarial
gains and losses, the effect of the asset
ceiling, excluding amounts included in net
interest on the net defined benefit liability
and the return on plan assets (excluding
amounts included in net interest on the
net defined benefit liability), are recognised
immediately in the Balance Sheet with a
corresponding debit or credit to retained
earnings through other comprehensive
income in the period in which they occur.
Remeasurements are not reclassified to
profit or loss in subsequent periods.

b) Provident fund

Retirement benefit in the form of provident
fund is a defined contribution scheme.
The Company has no obligation, other
than the contribution payable to the
provident fund. The Company recognises
contribution payable through provident
fund scheme as an expense, when an
employee renders the related services.
If the contribution payable to scheme
for service received before the balance

sheet date exceeds the contribution
already paid, the deficit payable to the
scheme is recognised as liability after
deducting the contribution already paid.
If the contribution already paid exceeds
the contribution due for services received
before the balance sheet date, then
excesses recognised as an asset to the
extent that the prepayment will lead to, for
example, a reduction in future payment
or a cash refund.

(iii) Other employee benefits

Employees (including senior executives) of the
Company receive remuneration in the form of
share based payment transactions, whereby
employees render services as consideration
for equity instruments. In accordance with the
Securities and Exchange Board of India (Share
Based Employee Benefits) Regulations, 2014
and the Ind AS 102 ‘Share based Payments', the
fair value of options granted under the Havells
Long Term 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
expense or credit recognised in the Statement
of Profit and Loss 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.

Where the terms of an equity-settled transaction
award are modified, the minimum expense
recognised is the expense as if 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 intrinsic
value of the share-based payment transaction,
or is otherwise beneficial to the employee as
measured at the date of modification. The
Employee stock option scheme is administered
through Havells Employee Welfare Trust.

The Company provides long term incentive plan
to employees via equity settled share based
payments as enumerated below:

(a) Havells Employee Stock Purchase Plan: The
fair value of options granted under this option
plan is recognised as an employee benefit
expense with corresponding increase in
equity in accordance with recognition and
measurement principles as prescribed

in Ind AS 102 ‘Share based Payments'
when grant is made. The total expense is
recognised over the vesting period, which
is the period over which all of the specified
vesting conditions are to be satisfied. At end
of the reporting period, the entity revises
its estimates of the number of options that
are expected to vest based on the non¬
market vesting and service conditions. It
recognises the impact of the revision to
original estimates, if any, in profit or loss, with
corresponding adjustment to equity.

(b) Havells Employees Long term Incentive
plan : These are in nature of employee
benefit wherein employees (including
senior executives) of the Company
purchase shares of the Company at fair
value on the grant cum allotment date and
receives remuneration in the form of ex-
gratia equivalent to predefined percentage
of purchase price paid by designated
employee subject to serving of relevant
period of service after the grant cum
allotment date. These are recognised at
fair value of shares granted and allotted as
employee benefit expense over the period
of employee serving relevant period.

c) Leave Obligation

Leave obligations: The Company has
liabilities for earned leave that are not
expected to be settled wholly within 12
months after the end of the period in which
the employees render the related service.
These obligations are therefore measured
as the present value of expected future
payments to be made in respect of services
provided by employees up to the end of the
reporting period using the projected unit
credit method. The benefits are discounted
using the appropriate market yields at the
end of the reporting period that have terms
approximating to the terms of the related
obligation. Remeasurements as a result
of experience adjustments and changes
in actuarial assumptions are recognised in
profit or loss.

The Company does not have an
unconditional right to defer settlement
for at least twelve months after the
reporting period, however, based on past
experience, the Company does not expect
all employees to avail the full amount of

is remeasured if there is a modification, a change
in the lease term, a change in the lease payments
(e.g., changes to future payments resulting from a
change in an index or rate used to determine such
lease payments) or a change in the assessment of an
option to purchase the underlying asset.

Lease payments are allocated between principal and
finance cost. The finance cost is charged to profit or
loss over the lease period so as to produce a constant
periodic rate of interest on the remaining balance of
the liability for each period. Variable lease payments
that depend on sales are recognised in profit or loss
in the period in which the condition that triggers those
payments occurs.

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.

o) Segment reporting

Operating segments are reported in a manner
consistent with the internal reporting provided to the
decision making authority. The Board of directors
monitors the operating results of all product segments
separately for the purpose of making decisions about
resource allocation and performance assessment.

p) 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
period. The weighted average number of equity
shares outstanding during the period is adjusted
for events such as bonus issue, bonus element in
a rights issue, share split, and reverse share split
(consolidation of shares) if any that have changed
the number of equity shares outstanding, without a
corresponding change in resources.

For the purpose of calculating diluted earnings
per share, the net profit or loss for the period
attributable to equity shareholders and the weighted
average number of shares outstanding during the
period are adjusted for the effect of all potentially
dilutive equity shares.

q) Borrowing Costs

Borrowing cost includes interest and other costs
incurred in connection with the borrowing of funds
and charged to Statement of Profit and Loss on
the basis of effective interest rate (EIR) method.
Borrowing cost also includes exchange differences

to the extent regarded as an adjustment to the
borrowing cost.

Borrowing costs directly attributable to the
acquisition, construction or production of an asset
that necessarily takes a substantial period of time to
get ready for its intended use or sale are capitalized
as part of the cost of the respective asset. All other
borrowing costs are recognised as expense in the
period in which they occur.

r) Cash and cash equivalents

Cash and cash equivalent in the balance sheet
comprise cash at banks and on hand and short-term
deposits with an original maturity of three months
or less, that are readily convertible to a known
amount of cash and subject to an inmaterial risk of
changes in value.

For the purpose of presentation in the statement of
cash flows, cash and cash equivalents includes cash
on hand, deposit held at call with financial institutions,
other short - term, highly liquid investments with
original maturities of three months or less that are
readily convertible to known amounts of cash and
which are subject to an inmaterial risk of changes
in value, and bank overdrafts. Bank overdrafts are
shown within borrowings in current liabilities in
the balance sheet.

s) Foreign currency translation

(i) Functional and presentation currency

Items included in the financial statements are
measured using the currency of the primary
economic environment in which the entity
operates (‘the functional currency'). The
Company's financial statements are presented
in Indian rupee (H) which is also the Company's
functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into
the functional currency using the exchange rate
prevailing at the date of the transaction. Foreign
exchange gains and losses resulting from the
settlement of such transaction and from the
translation of monetary assets and liabilities
denominated in foreign currencies at year end
exchange rate are generally recognised in the
statement of profit and loss.

Non-monetary items that are measured in
terms of historical cost in a foreign currency are
translated using the exchange rates at the dates
of the initial transactions. Non-monetary items

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
material 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 material to the fair value
measurement is directly or indirectly observable

Level 3- Valuation techniques for which the

lowest level input that is material 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

(i) During the year, a settlement agreement was executed between Havells India Limited with HPL Group & its promoters,
wherein HPL Group acknowledges Havells India Limited & its promoters' absolute rights to the 'HAVELLS' trademark and
has undertaken not to use or challenge the ‘HAVELLS' trademark in any form. The Company has recognised the settlement
amount of H 129.60 crores as an Intangible asset as per Ind AS 38 under "Trademarks". Given the strength of the “Havells”
brand in fast moving electrical goods sector, its long-standing market presence, and our plan to continue using and investing
in the brand, there is no foreseeable limit to the period over which the trademark is expected to generate economic benefits
for the Company. Accordingly, the Company has considered indefinite life of the said intangible assets. The recoverable
amount of the above-mentioned assets is more than the carrying amount.

(ii) Impairment testing of goodwill and intangible assets with indefinite lives

The management has determined budgeted gross margin based on past performance and its expectations of future market
scenario. The revenue and profit growth rates used are consistent with the forecasts included in industry reports.

The other key assumptions by the management include:

• As per industry estimates, the large home appliance and consumer electronics market (majorly including air conditioners,
refrigerators, washing machines and televisions) is expected to grow at a rate of 15% per annum for next few years.

• Revenue growth supported by distribution expansion and brand salience improvement

• Addition and expansion of manufacturing capacities for refrigerators and washing machines is assumed to progress
Lloyd towards a full stack consumer durable player

• Margin improvement through better absorption of costs with scale expansion and operating leverage. The contribution
margins are assumed to be in the range of 14-15%

(a) Trade Receivable represents the amount of consideration in exchange for goods or services transferred to the customers that
is unconditional.

(b) During the earlier years, the Company had entered in to agreements with the customers wherein the Company had identified
multiple performance obligations as per Ind AS 115 "Revenue from contracts with customers". The Company's right to receive
consideration is conditional upon satisfaction of all performance obligations. Accordingly, the Company has recognised
contract assets in respect of performance obligations satisfied during the year. The contract assets arises when Company
satisfies a performance obligation but does not have an unconditional right to consideration.

(c) The Company has entered into the agreements with customers for sale of goods and services. The Company has identified
these performance obligations and recognised the contract liabilities in respect of contracts, where the Company has obligation
to deliver the goods and perform specified services to a customer for which the Company has received consideration. There
has been increase in the contract liabilities in the normal course of business.

e) Terms/rights attached to equity shares

The Company has only one class of issued share capital i.e. equity shares having a par value of H 1/- per share (March
31, 2025: H1/- per share). Each holder of equity shares is entitled to one vote per share. The Company declares and pays
dividend in Indian rupees.The dividend proposed by the Board of Directors is subject to the approval of the shareholders in
the ensuing Annual General Meeting.

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

(C) NATURE AND PURPOSE OF RESERVES

(a) Capital reserve

During amalgamation/merger approved by honourable court, the excess of net assets taken over the consideration paid, if
any, is treated as capital reserve. This capital reserve has arisen as a result of scheme of amalgamation in the past periods.

(b) Securities premium

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.

(c) General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a
specified percentage in accordance with applicable regulations adjusted by utilisation of reserve in accordance with scheme
of Amalgamation in earlier years. The requirement to mandatorily transfer a specified percentage of the net profit to general
reserve before declaration of dividend has been withdrawn. However, the amount previously transferred to the general
reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

(d) Share options outstanding account

The share options outstanding account is used to recognise the grant date fair value of options issued to employees under
Employee stock purchase plan.

(e) Retained earnings

Retained Earnings are profits that the Company has earned till date less transfer to General Reserve, dividend or other
distribution or transaction with shareholders.

Notes:

(i) Trade Payables include due to related parties H31.50 crores (March 31,2025 : H 35.57 crores) {refer note 33(6)(D)}. For terms
and conditions with related parties, refer note 33(6).

(ii) The amounts are unsecured and non interest-bearing and are usually on varying trade term.

(iii) The amounts falling in the category of more than 1 year are related to pending obligations on the part of the supplier as per
agreed terms and conditions mentioned in respective contracts.

There were no material foreign exchange differences that would affect the liabilities under the supply chain facility
in either period.

*The Company has not provided comparative information in respect of the amendments to Ind AS7and Ind AS 107 relating to supply chain facility,
as it has applied the transitional relief available on initial adoption of these amendments, which allows entities not to present comparative disclosures
for prior periods.

a) Information as required to be furnished as per section 22 of the Micro, Small and Medium Enterprises Development
Act, 2006 (MSMED Act) for the year ended March 31,2026 and March 31,2025 is given below. This information has
been determined to the extent such parties have been identified on the basis of information available with the Company.

a) Provision for product warranties

(i) Warranties

A provision is recognised in respect of expected warranty claims and after-sales service obligations arising on products sold
within the last one to seven years. The provision is estimated based on historical experience of repair rates and defective
product returns. It is anticipated that a significant portion of the related expenditure will be incurred during the next financial
year, with all remaining costs expected to be settled within seven years of the reporting date, consistent with the applicable
warranty periods. The provision has been calculated with reference to latest available information regarding defective returns,
taking into account current sales levels and warranty periods ranging from one to seven years across all product categories.
The assumptions and estimation methodology applied in the current year are consistent with those adopted in the prior year.

b) Provision for litigations

Provision for litigations amounting to H 11.85 crores (March 31,2025: H 9.21 crores) is created against demands raised in various
ongoing income tax, goods and service tax act etc.litigations in ordinary course of business. Based on the facts of the case
and legal precedents, the management believes there would be a probable outflow of resources and accordingly, has created a
provision in books of account.

(v) Performance obligation

Sale of products: Performance obligation in respect of sale of goods is satisfied when control of the goods is transferred to the
customers, generally on delivery/ dispatch of the goods as applicable and payment is generally due as per the terms of contract
with customers.

Sale of services: The performance obligation in respect of maintenance services is satisfied over a period of time and acceptance
of the customer. In respect of these services, payment is generally due upon completion of maintenance period based on time
elapsed and acceptance of the customer. In certain non-standard contracts, where the Company provides warranties in service of
consumer durable goods, the same is accounted for as a separate performance obligation and a portion of the transaction price
is allocated based on its relative standalone price. The performance obligation for the warranty service is satisfied over time based
on time elapsed .

Note: The remaining performance obligation expected to be recognised in more than one year relates to amounts received
from customers against which performance obligations are to be satisfied over the period of one to four years. All other
remaining performance obligations are expected to be recognised within one year. During the year ended March 31, 2026,
revenue from sales of service includes amount of contract liability (current) at the beginning of year of H 104.25 crores
(March 31,2025: H 98.73 crores).

(vi) Disclosure pursuant to Appendix C of Ind AS 115

The Company was awarded a contract for replacement of existing conventional street/ park lights with LED street/park lights
by a Municipal Corporation in April 2017. As per the agreement, the Company shall also be responsible for the operation and
maintenance of LED street/park lights for a period of 7 years after installation which will be completed in FY 2026-27. The
consideration received by the Company under the contract is based on the energy savings resulting from the LED street/park
lights. The revenue recognised during the year and the contract assets balance as at year-end from such contract amounts to
H 47.20 crores (March 31,2025: H 46.34 crores) and H 1.01 crores (March 31,2025: H 12.34 crores) respectively.

Notes:

The above figures are net of provisions made by the Company. The Company is contesting these demands and the
management, believe that its position will likely be upheld in the appellate process. The management believes that the
ultimate outcome of this proceeding will not have a material adverse effect on the Company's financial position and
results of operations.

*Based on favourable decisions in similar cases, the Company does not expect any liability against these matters in accordance with principles of Ind AS 12
'Income taxes' read with Ind AS 37 Provisions, Contingent Liabilitiesand Contingent Assets' and hence no provision has been considered in the books of
accounts except for provision created in respect of few years {refer note 20(ii)}

The above amounts contain interest and penalty where included in the order issued by the department to the Company

(c) As per E-waste (Management) Rules, 2022, as amended, the Company has an obligation to complete the Extended Producer
Responsibility (EPR) targets. The Company has fulfilled its obligation for the current financial year accordingly. Further, Central
Pollution Control Board of India has notified higher floor prices for exchange of EPR certificates, which has been legally
challenged before the Delhi High Court by the Company and several other producers in similar businesses. Based on
management assessment supported by legal opinion, the Company is of the view that it has a strong case on merit and
accordingly no additional provision is considered necessary.

C Undrawn committed borrowing facility

During the year, the company has availed fund and non fund based unsecured working capital limit amounting to H 1142.50 crores
(March 31, 2025: H 942.50 crores) under multiple banking arrangements from IDBI Bank Limited, Yes Bank Limited, Standard
Chartered Bank Limited, HSBC Bank, ICICI Bank Limited, IndusInd Bank Limited, HDFC Bank Limited, DBS Bank Limited and
CITI Bank N.A. An amount of H 488.02 crore remain undrawn as at (March 31,2025: H 573.27 crores).Drawn amount is related to
non fund based bank guarantees and letters of credit.

D Other Litigations

The Company has taken provisions amounting H 11.85 crores (March 31,2025 : H 9.21 crores) against the income tax and other
indirect tax related litigations. These provisions represent estimates made where liability has been assessed as probable. The
probability and the timing of the outflow with regard to these matters depend on the final outcome of the litigations/disputes.
Hence, the Company is not able to reasonably ascertain the timing of the outflow.

E The Company has outstanding obligation amounting to H 0.18 crores (March 31,2025: H 0.12 crores) in respect of bonds
given to central tax department against import of goods at concessional rate of basic customs duty. The Company expects
to fulfil the obligation in due course of time.

F The Company has export obligation of H 346.24 crores (March 31, 2025: H 224.55 crores) on account of import duty
exemption of H 16.87 crores (March 31,2025: H11.85 crore) on capital goods under the Export Promotion Capital Goods
(EPCG) and H 1.05 crores (March 31,2025: H 0.05 crores) advance authorisation scheme of laid down by the Government of
India. The Company expects to fulfil the obligation in due course of time.

Compensated absences

The provision for compensated absences covers the liability for earned leave as per actuarial valuation. The amount of provision
recognised is H 9.16 crores (March 31, 2025 H 15.94 crores), net of amount funded with Bajaj Life Insurance Limited of
H 30.35 crores (March 31,2025 H 12.82 crores)

Defined Benefit Plan

The employees' Gratuity Fund Scheme, which is a defined benefit plan, is managed by the trust which maintains its investments
with Bajaj Life Insurance Limited. The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the gratuity plan,
every employee who has completed at least five years of service gets a gratuity on departure at 15 days of last drawn basic salary

for each completed year of service. 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. Further refer note (p) below.

The following tables summaries the components of net benefit expense recognised in the statement of profit or loss, the funded
status and amounts recognised in the balance sheet for the plan:

m) Discount rate is based on the prevailing market yields of Indian Government securities as at the balance sheet date for the
estimated term of the obligation.

n) The sensitivity analysis above has been determined based on a method that extrapolates the impact on defined benefit
obligation as a result of reasonable changes in assumptions occurring at the end of the reporting period while holding all other
assumptions constant. In practice, it is unlikely to occur and change in some of the assumptions may be correlated. When
calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method (present
value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has
been applied as when calculating the defined benefit liability recognised in the balance sheet.

o) The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the previous year.

p) Pursuant to the notification issued by the Ministry of Labour and Employment, multiple existing labour legislations have
been consolidated into a unified framework comprising four Labour Codes collectively referred to as the 'New Labour
Codes' which became effective from November 21,2025. The Company has reassessed its employee benefit obligations in
accordance with the revised definition of wages. Accordingly, an incremental liability of H 45.03 crores has been recognised
as an "Exceptional Items" in the statement of Profit and Loss. The Ministry is in the process of notifying related rules to the
New Labour Codes and impact of those will be evaluated and accounted for in the period in which they are notified.

5 Segment Reporting

The segment reporting of the Company has been prepared in accordance with Ind AS 108, "Operating Segment". For
management purposes, the Company is organized into business units based on its products and services and has six reportable
segments as follows:

b) Identification of Segments:

Operating segments have been identified on the basis of the nature of product/ services and have been identified as
per the quantitative criteria specified in the Ind AS.The Board of Directors monitors the operating results of its business
segments separately for the purpose of making decisions about resource allocation and performance assessment. Segment
performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements.

c) Revenue and expenses have been identified to a segment on the basis of relationship to operating activities of the segment.
Revenue and expenses which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have
been disclosed as "unallocable".

d) Segment assets and segment liabilities represent assets and liabilities in respective segments. Investments, tax related
assets, borrowings and other assets and liabilities that can not be allocated to a segment on reasonable basis have been
disclosed as "unallocable".

e) There are no customers having revenue exceeding 10% of total revenues.

a) The transactions with related parties are made on terms equivalent to those that prevail in arm's length transactions.
Outstanding balances at the year-end are unsecured and interest free. The settlement for these balances occurs through
payment. There have been no guarantees provided or received for any related party receivables or payables. For the year
ended March 31,2026 the Company has not recorded any impairment of receivables relating to amounts owed by related
parties (March 31,2025: HNil) .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.

b) As at March 31,2026, the Company has not granted any loans to the promoters, directors, KMPs and the related parties (as
defined under Companies Act, 2013), either severally or jointly with any other person (March 31,2025: Nil).

c) Transactions with related parties are reported gross of Goods and Service Tax.

d) Transactions with key management personnel for the year ended March 31, 2026 and March 31, 2025 does not include
provisions for leave obligation and gratuity, as separate actuarial valuation were not available.

7 Share based payments

The Company has in place following employee stock purchase plan approved by shareholders of the Company in compliance with

Securities and Exchange Board of India (Share Based Employee Benefits) regulations, 2021 :

(a) Havells Employee Stock Purchase Plan 2014 : In accordance with this scheme, 74,115 (March 31,2025 : 54,274) share
options of H 1 each were granted, out of which 73,082 (March 31, 2025: 53,883) share options of H 1 each were vested
and allotted on May 16, 2025 (March 31, 2025 : May 31, 2024) to eligible employees at H 1638.50 (March 31, 2025:
H 1,644.45) per share as contributed by these employees . As per the scheme, 50% of the shares are under lock in period
of 13 months and balance 50% for 2 years. Also as per the scheme, the Company is obliged to pay 50% of the contribution
made by eligible employees as retention bonus over a period of two years in equal instalments. Accordingly, a sum of H 4.52
crores (March 31,2025 : H 3.75 crores) has been recognised as employee stock purchase plan expense (refer note 28).

(b) Havells Employee Stock Purchase Plan 2015 : In accordance with this scheme, 150,000 (March 31,2025: 150,000) share
options of H 1 each were granted, vested and allotted on May 16, 2025 (March 31, 2025: May 31, 2024) at H 1638.50
(March 31,2025: H 1,644.45) per share to eligible employees.As per the scheme, 78% of the shares are under lock in period
of 13 months and remaining 22% are under lock in period for 2 years. Accordingly, a sum of H 24.58 crores (March 2025 :
H 24.67 crores) has been recognised as employee stock purchase plan expenses (refer note 28).

(c) Havells Employee Stock Purchase Plan 2016 : In accordance with the said scheme, 44,043 (March 31,2025: 41,529) share
options of H 1 each were granted to eligible employees with graded vesting in three years starting from 2025. During the
year, 41,607 equity shares of H 1 each (March 31,2025 : 32,157 equity shares) were allotted at H 1638.50 (March 31,2025 :
H1,644.45) per share on May 16, 2025 (March 31,2025 : May 31,2024) and 1,474 equity shares of H 1 each on October 16,
2025. Accordingly, a sum of H 7.10 crores (March 31,2025: 6.78 crores) has been recognised as employee stock purchase
plan expense (refer note 28) and balance outstanding of H 4.35 crores (March 31,2025 : 4.30 crores) (refer note 14).

(d) Havells Employee Stock Purchase Plan 2022 : In accordance with the said scheme, 134,690 (March 31,2025: 1,11,231)
share options of H 1 each were granted to eligible employees with graded vesting in five years starting from 2025. During
the year, 48,947 equity shares of H 1 each (March 31,2025 : 22,662) were allotted at H 1638.50 (March 31,2025 : 1644.45)
per share on October 16, 2025 (March 31,2025 : October 07, 2024). Accordingly, a sum of H15.41 crores (March 31,2025:
H 12.68 crores) has been recognised as employee stock purchase plan expense refer note 28 and balance outstanding of
H 19.38 crores (March 31,2025 : H 12.71 crores) (refer note 14).

8 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. Details are as under:

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

The fair value of the other 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 value of unquoted instruments, other non-current financial assets and non-current financial liabilities is estimated by
discounting future cash flows (DCF model) using rates currently available for debt on similar terms, credit risk and remaining
maturities. The valuation requires management to use unobservable inputs in the model, of which the significant unobservable
inputs are disclosed in the tables below. Management regularly assesses a range of reasonably possible alternatives for those
significant unobservable inputs and determines their impact on the total fair value.

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.

3) Fair value hierarchy

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

Level 1: The fair value of financial instruments traded in active markets is based on quoted (unadjusted) market prices at the
end of the reporting period for identical assets or liabilities.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques
which maximise 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 3: 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.

There are no transfers among levels 1,2 and 3 during the year.

This section explains the judgement and estimates made in determining the fair value of financial assets that are:

a) Recognised and measured at Fair value

b) Measured at amortised cost and for which fair value is disclosed in financial statements

10 Financial risk management objectives and policies

The Company's principal financial liabilities comprise 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 trade and other receivables, and cash and
cash equivalents 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 is exposed to market risk, credit risk and liquidity risk. The Company's senior management oversees the management
of these risks. The senior professionals working to manage the financial risks and the appropriate financial risk governance
framework for the Company are accountable to the Board of Directors and Audit Committee. This process provides assurance
to Company's senior management that the Company's financial risk-taking activities are governed by appropriate policies and
procedures and that financial risk are identified, measured and managed in accordance with Company policies and Company
risk objective.

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, investments, and foreign currency receivables and payables. The sensitivity analysis in the following sections relate
to the position as at reporting date. The analysis exclude the impact of movements in market variables on: the carrying values
of gratuity and other post-retirement obligations; provisions; and the non-financial assets and liabilities. The sensitivity of the
relevant Profit and Loss item and equity 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 31,2026 and 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.

Note:

Figures in bracket represents payables

(ii) Interest Rate Risk

The Company's investments are primarily in fixed rate interest bearing investments. Hence, the Company is not
significantly exposed to interest rate risk.

(iii) Commodity Price Risk

The Company is affected by the price volatility of certain commodities. Its operating activities require the ongoing
manufacture of industrial and domestic cable and other electronic items and therefore require a continuous supply
of copper and aluminium being the major input used in the manufacturing. To mitigate the risk of supply and price
fluctuations, Domestic and overseas sources are bench-marked to Optimise the allocation of business share among
various sources. The Company's Board of Directors has developed and enacted a risk management strategy regarding
commodity price risk and its mitigation. The Company mitigated the risk of price volatility by entering Long Term & Short
term contracts for the Purchase of these commodities basis estimated annual requirements.

(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 and Contract Assets

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. Credit quality of a customer is assessed based on an extensive

credit rating scorecard and individual credit limits are defined in accordance with this assessment. Outstanding customer
receivables are regularly monitored and any shipments to major customers are generally covered by Trade Receivable
buyout facility without recourse, letters of credit and other forms of security.

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

The group assigns the following internal credit ratings to each class of financial assets based on the assumptions,
inputs and factors specific to the class of the financial assets. The group provides for expected credit loss based
on the following:

Notes:

(i) Debt service = Interest & Lease Payments Principal Repayments

(ii) Capital Employed = Tangible Net Worth Total Borrowings Deferred Tax Liability

(iii) Tangible Net worth is computed as Total Assets - Total Liabilities.

'Borrowings does not includes Lease liabilities

18 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, other than mentioned below, 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:”

The relevant provisions of the Foreign Exchange Management Act, 1999 (42 of 1999) and The Companies Act 2013 have
been complied with for such transactions and the transactions are not violative of the Prevention of Money-Laundering Act,
2002 (15 of 2003).

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 to or 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 read with Companies (Restriction on number of layers) Rules, 2017.

(iv) Compliance with approved scheme(s) of arrangements: The Company has not entered into any scheme of arrangement
which has an accounting impact in 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, repayable on demand.

19 The Company has used an accounting software for maintaining its books of account which has a feature of recording audit
trail (edit log) facility and that has operated throughout the financial year for all the relevant transactions recorded in the
software except that the audit trail at database level contains only the modified values. There was no instance of audit trail
feature being tampered with. The audit trail, where enabled, has been preserved as per the statutory requirements.

20 The figures have been rounded off to the nearest crore of rupees upto two decimal places. The figure 0.00 wherever stated
represents value less than H 50,000/-.

21 Note No.1 to 33 form integral part of the Standalone Balance Sheet and Standalone Statement of Profit and Loss.

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

For Price Waterhouse & Anil Rai Gupta Rajesh Kumar Gupta

Co Chartered Accountants LLP Chairman and Whole-time Director and

Firm Registration No. 304026E/E-300009 Managing Director Group CFO

DIN: 00011892 DIN: 00002842

Sougata Mukherjee Ameet Kumar Gupta Sanjay Kumar Gupta

Partner Director Company Secretary

Membership No. 057084 DIN: 00002838 FCS No.: F 3348

Date: April 22, 2026 Date: April 22, 2026 Lalit Kumar Garg

Place: Noida Place: Noida Vice President - Finance