K. Provisions, Contingent Assets/ Contingent Liabilities

Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a
past event, it is probable that an outflow of economic benefits will be required to settle the obligation and a
reliable estimate can be made ofthe amount ofthe obligation.

Show cause notices issued by Government Authorities where the probability of outflow of economic resources
is remote are not considered as obligations. When the demands are raised against show-cause notices and are
disputed by the company, these are treated as disputed obligations along with other contingent liabilities. Such
contingent liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither
recognized nor disclosed in the financial statements.

Warranty Provisions: Provisions for Warranty related costs are recognized when the product is sold or
service is provided. Provision is based on historical experience. The estimate of such warranty related costs is
revised annually.

L. Leases

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a
period of time in exchange for consideration. To assess whether a contract conveys the right to control the use
of an identified asset, the Company assesses whether: (i) the contract involves the use of an identified asset (ii)
the Company has substantially all of the economic benefits from use of the asset through the period of the lease
and (iii) the Company has the right to direct the use ofthe asset.

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

As a lessee, the Company determines the lease term as the non-cancellable period of a lease adjusted with any
option to extend or terminate the lease, if the use of such option is reasonably certain. The Company makes an
assessment on the expected lease term on a lease-by-lease basis and thereby assesses whether it is reasonably
certain that any options to extend or terminate the contract will be exercised. In evaluating the lease term, the
Company considers factors such as any significant leasehold improvements undertaken over the lease term,
costs relating to the termination of the lease and the importance of the underlying asset to Company's
operations taking into account the location of the underlying asset and the availability of suitable alternatives.
The lease term in future periods is reassessed to ensure that the lease term reflects the current economic
circumstances.

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

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

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

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

If modifications or reassessments occur, the lease liability and right of use asset are re-measured. Right of use
assets are depreciated over the shorter ofthe useful life ofthe asset or the lease term.

M. Income Tax:

Income tax expense represents the sum of current tax payable and deferred tax.

Current Tax: The tax currently payable is based on the current year taxable profit for the year. The current tax
is calculated using the tax rates that have been enacted or substantively enacted at the end of the reporting
period.

Deferred tax: Deferred tax is provided using the Balance Sheet method on temporary differences between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting
date. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is
probable that the taxable profits will be available against which those deductible temporary differences can be

utilized. Deferred tax is calculated using the tax rates that have been enacted or substantively enacted at the end
of the reporting period. 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 utilized.

N. Earnings per Share

The Company presents basic and diluted earnings per share data for its ordinary shares. Basic earnings per
share is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the
weighted average number of ordinary shares outstanding during the year, adjusted for own shares held. Diluted
earnings per share is determined by adjusting the profit or loss attribute to ordinary shareholders and the
weighted average number of ordinary shares outstanding, adjusted for own shares held, for the effects of all
dilutive potential ordinary shares.

O. Employee benefits:

Defined Contribution Plans: Payments made to a defined contribution plan such as provident Fund are charged
as an expense in the Profit and Loss Account as they fall due.

Defined Benefit Plans: Company's liability towards gratuity to past employees is determined using the
projected unit credit method which considers each period of service as giving rise to an additional unit of
benefit entitlement and measures each unit separately to build up the final obligation. Past services are
recognized on a straight-line basis over the average period until the amended benefits become vested.
Actuarial gain and losses are recognized immediately in the statement of profit and loss Account as income or
expense. Obligation is measured at the present value of estimated future cash flows using a discounted rate that
is determined by reference to market yields at the Balance Sheet date on Government Securities where the
currency and terms of the Government Securities are consistent with the currency and estimate terms of the
defined benefit obligations.

P. Financial Instruments:

Non-derivative financial instruments
Non-derivative financial instruments consist of:

i) financial assets, which include cash and cash equivalents, trade receivables, other advances and eligible
current and non-current assets;

ii) Financial liabilities, which include long and short-term loans and borrowings, trade payables, eligible
current and non-current liabilities.

Non derivative financial instruments are recognized initially at fair value including any directly attributable
transaction costs. Financial assets are derecognized when substantial risks and rewards of ownership of the
financial asset have been transferred. In cases where substantial risks and rewards of ownership of the financial
assets are neither transferred nor retained, financial assets are derecognized only when the Company has not
retained control over the financial asset.

Subsequent to initial recognition, non-derivative financial instruments are measured as described below:

a) Cash and cash equivalents

For the purposes of the cash flow statement, cash and cash equivalents include cash in hand, at banks and
demand deposits with banks, net of outstanding bank overdrafts, if any, that are repayable on demand and
are considered part of the Company's cash management system.

b) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are
not quoted in an active market. They are presented as current assets, except for those maturing later than
12 months after the reporting date which are presented as non-current assets. Loans and receivables are
initially recognized at fair value plus directly attributable transaction costs and subsequently measured at
amortized cost, less any impairment losses. Loans and receivables comprise trade receivables and other
assets.

The company estimates the un-collectability of accounts receivable by analyzing historical payment
patterns, customer concentrations, customer credit-worthiness and current economic trends. If the
financial condition of a customer deteriorates, additional allowances may be required.

c) Trade and payable

Liabilities are recognized for amounts to be paid in future for goods or services received, whether billed
by the supplier or not.

Q. Cash Flow Statement:

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of
transactions of a non - cash nature, any deferrals or accruals of past or future operating cash receipts or
payments and item of income or expenses associated with investing or financing cash flows. The cash flows
from operating, investing and financing activities ofthe Company are segregated.

* a) Corporate Loan (Term Loan) from State Bank of India is secured by way of Primary security of hypothecation
of on entire assets created from Corporate Loan. and Collateral Security of Exclusive charge on company's
industrial Land & Building on Plot No. S-119(M), in Sy No. 49, with an extent of 4.00 Acres, situated at e-City,
Raviryala Village, Maheswaram Mandal, R R Distict, Telangana by way of equitable mortgage and personal
guarantee of the Managing Director ofthe Company and the rate ofinterest @8.40% p.a.

b) Cash Credit from State Bank of India is secured by way of first pari-passu charge (Hypothecation) on entire
current assets (including stocks, receivables & other chargeble current assets) of the company alongwith other
WC lender i.e., Canara Bank in Multiple Banking Arrangement and Collateral Security of First charge by way

of equitable mortgage of the commercial Unit No.201 & 202 on 2nd Floor, with salable area of 5395 SFT and
6889 SFT respectively in Vasavi’s Shalom Sky City in commercial Block-1 with un-divided share of land
admeasuring 150.09 Sq. Yds in SY No. 17, Municipal No. 1-72/A Situcated at Gachibowli, Serilingampally
(M), RangaReddy (D), Hyderabad - 500032 and First Charge of Company's industrial Land & Building on Plot
No. S-119(M) in SY No. 49 with an extent of 4.00 Acres, situated at e-City, Raviryala Village, Maheswaram
(M), Rangareddy (Dt), Hyderabad- 501510, Telangana, India , by way of equitable mortgage and personal
guarantee of the Managaing Director ofthe Company and the rate ofinterest @8.85% p.a.

c) Open Cash Credit from Canara Bank is secured by way of Primary security of hypothecation of Stocks,
Book debts and Collateral Security of Plant & Machinery, other fixed assets of the company and Land &
Buildings admeasuring AC. 0.93 Cents (450.20 Sq. Yards) situated at Plot No. 47, Survey No. 141, APIIC
Industrial Park, Gambheeram (V), Visakhapatnam and personal guarantee of the Managaing Director ofthe
Company and the rate of interest @10.00% p.a.

d) The Carrying amount of Current and Non-current assets pledged as primary and collateral security for non¬
current and current borrowings are disclosed in Note No. 50.

(b) Contract Assets

Company recognized contract assets when it satisfies its obligation by transferring the goods or services
to the customer and right to receive the consideration is established which is subject to some conditions
to be fulfilled by the company in future before receipt of consideration amount. Such assets are ? Nil.
During the year company has recognized revenue of ? Nil (P.Y. ? Nil) from the performance obligations
satisfied in earlier periods.

The company has made the adjustment of ? Nil (P.Y. ? Nil) in the revenue of ? 22,135.23 Lakhs(P.Y.?
24,848.36 Lakhs) recognized during the year on account of discounts, rebates, refunds, credits, price
concessions, incentives performance bonuses etc as against the contracted revenue of ? 22,135.23
Lakhs ( P.Y. ? 24,848.36 Lakhs).

( c) Contract Liabilities

Upon execution of contract with the customers, certain amount in the form of EMD, Security Deposit,
Margin Money, advance for payment of custom duty etc. received from the customers which is shown as
advance received from customers under the heading “Other Financial Liabilities” and “Other
Liabilities”. The balances are ? 2,010.29 Lakhs
(d) Practical expedients

During the year company has entered into sales contracts with its customers where contracts are not
executed, same has not been disclosed as practical expedient as the duration of the contract is less than
one year or right to receive the consideration established on completion of the performance by the
company.

B. Significant judgements in the application of this standard

(i) Revenue is recognized by the company when the company satisfies a performance obligation by
transferring a promised good or service to its customers. Asset/goods/services are considered to be
transferred when the customer obtains control of those asset/goods/services.

(ii) The company considers the terms of the contract and its customary business practices to determine the
transaction price. The transaction price is the amount of consideration to which an entity expects to be
entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected
on behalf ofthird parties (for example, GST etc.).

(iii) The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or
both. Any further adjustment will be made by raising debit/credit notes on the customer. While determining
the transaction price effects of variable consideration, constraining estimates of variable consideration, the
existence of a significant financing component in the contract, non-cash consideration and consideration
payable to a customer is also considered.

C. Assets Recognised from costs to obtain or fulfill a contract with a customer

The costs incurred by the company are fixed in nature with no significant incremental cost to obtain or fulfill a

contract with a customer and same is charged to profit and loss as a practical expedient.

Note: (1) The company has allotted 7,600 equity shares on 02nd July 2025, 4,97,410 equity shares on 27th
December, 2025 , 1,91,140 equity shares on 29th January , 2026 and 52,780 equity shares on 26th
February, 2026 under Avantel Employee Stock Option Plan 2023 (ESOP-2023).

(2) During the year, the company issued 2,02,26,100 equity shares of ?2 each, fully paid-up, to its
shareholders pursuant to a rights issue.

Note: 40. Employee stock option plans (ESOP)_

The Company instituted Avantel Employees Stock Option Plan-2023 (hereinafter referred to as "Avantel 2023
Plan") for all eligible employees pursuant to a resolution approved by the shareholders in the Extra-ordinary General
Meeting held on November 11, 2023. The Nomination, Governance and Compensation Committee of the Board of
the parent company (the “Committee”) administers the Avantel 2023 Plan and grants stock options to eligible
employees. The Committee determines which eligible employees will receive options, the number of options to be
granted, the exercise price, the vesting period and the exercise period. The vesting period is determined for all
options issued on the date of grant. Participation in the plan is at the board’s discretion and no individual has a
contractual right to participate in the plan or to receive any guaranteed benefits.

The company has established Avantel 2023 Plan with 45,00,000 equity shares.

The exercise price of the options is INR 50 per share. The fair value of the share options is estimated at the grant date
using a Black-Scholes Method, taking into account the terms and conditions upon which the share options were
granted. However, the above performance condition is only considered in determining the number of instruments
that will ultimately vest.

The carrying amount ofthe liability at 31 March 2026 was ? 1,037.50 Lakhs (31 March 2025: ? 1,330.71 Lakhs).

During the year a reserve was made towards outstanding of ESOPs and Share based payment expenses for the year
ended 31 March 2026 of ? 679 lakhs (31 March 2025 - ? 1456.63 Lakhs).

The Weighted average grant date fair value of the options granted during the years ended 31 March 2026 was ?
127.00 per option.

The weighted average share price at the date of exercise of options exercised during the year ended 31 March 2026
was ? 150.96 (31 March 2025 - ? 155.76) per share.

The aggregate intrinsic value of options exercised during the years ended 31 March 2026 and 31 March 2025 was ?
NIL and ? NIL, respectively.

The following tables list the inputs to the models used for the three plans for the years ended 31 March 2026 and 31
March 2025, respectively:

Fair Value Hierarchy Management considers that, the carrying amount of those financial assets and financial
liabilities that are not subsequently measured at fair value in the Financial Statements approximate their transaction
value. No financial instruments are recognized and measured at fair value for which fair values are determined using
the judgements and estimates. The fair value of Financial Instruments referred below has been classified into three
categories depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted
prices in active market for identical assets or liabilities. (Level-1 measurements) and lowest priority to unobservable
(Level-3 measurements).

The Company does not hold any equity investment and no financial instruments hence the disclosure are nil
Financial Risk Management:

The Company's activities expose to a variety of financial risks viz.,market risk, credit risk and liquidity risk. The
Company's focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse
effects on its financial performance. The primary market risk to the Company is credit risk and liquidity risk. The
Company's exposure to credit risk is influenced mainly by Government Orders.

Management of Market Risk:

Market risks comprises of Price risk and Interest rate risk. The Company does not designate any fixed rate financial
assets as fair value through Profit and Loss nor at fair value through OCI. Therefore, the Company is not exposed to
any interest rate risk. Similarly, the Company does not have any Financial Instrument which is exposed to change in
price.

Foreign Currency Risks:

The Company is exposed to foreign exchange risk arising from various Currency exposures primarily with respect to
the US Dollars (USD), for the imports being made by the Company.

Credit Risk:

Credit risk is the risk of financial loss to the Company if a customer fails to meet its contractual obligations. The
maximum exposure to the credit risk at the reporting date is primarily from trade receivables. The company
operations are with Government and allied companies and hence no issues credit worthiness. The company
considers that, all the financial assets that are not impaired and past due as on each reporting dates under review are
considered credit worthy.

Credit risk exposure

An analysis of age-wise trade receivables at each reporting date is summarized as follows:

Liquidity Risk:

The company's liquidity needs are monitored on the basis of monthly projections. The principal sources of liquidity
are cash and cash equivalents, cash generated from operations and availability of cash credit and overdraft facilities
to meet the obligations as and when due. Short term liquidity requirements consist mainly of sundry creditors,
expenses payable and employee dues during the normal course of business. The company maintains sufficient
balance in cash and cash equivalents and working capital facilities to meet the short term liquidity requirements.

The company assesses long term liquidity requirements on a periodical basis and manages them through internal
accruals and commited credit lines.

The following table shows the maturity analysis of the Companies Financial Liabilities based on contractually
agreed, undiscounted cash flows as at the balance sheet date.

Note: 48. The disclosure relating to transactions with Micro, Small and Medium Enterprises

Sundry Creditors includes ? 73.13 Lakhs (previous year ? Nil) due to Small Scale & Ancillary undertakings. There
are no Micro, Small and Medium Enterprises, to whom the Company owes dues, which are outstanding for more
than 45 days at the Balance Sheet date. The above information has been determined to the extent such parties have
been identified on the basis of information available with the Company. This has been relied upon by the auditors.

Note: 49. Corporate Social Responsibility (CSR)

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at
least 2% of its average net profit for the immediately preceding three financial years on corporate social
responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting
education, healthcare and women empowerment has been formed by the Company as per the Act. The funds were
primarily allocated to a corpus and utilised throughout the year on these activities which are specified in schedule
VII of the Companies Act, 2013.

Note: 52.

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

Note: 53.

The Company has not been declared willful defaulter by any bank or financial institution or government or any
government authority.

Note: 54.

The Company has not given any Loans or Advances in the nature of Loans to specified persons that are Repayable on
Demand or without specifying any terms or period of repayment.

Note: 55.

The Company does not have transactions with Companies struck off under section 248 of the Companies Act,2013
or section 560 ofthe Companies Act, 1956 during the year.

Note: 56.

During the year there are no events occurring after the balance sheet date.

Note: 57.

During the year there are no prior period items.

Note: 58.

The company's accounting software has audit trail functionality (edit log). This feature remained operational
throughout the year, capturing a chronological record of all relevant transactions processed within the software.