5.13 Provisions

Provisions are recognised when the Company has
a present obligation (legal or constructive) as a
result of past events, it is probable that an outflow

of resources embodying economic benefits will
be required to settle the obligation and a reliable
estimate can be made of the amount of the
obligation. The expenses relating to a provision is
recognised in the statement of profit and loss net
of any reimbursement.

If the effect of the time value of money is material,
provisions are discounted using a current pre¬
tax rate that reflects, when appropriate, the risk
specific to the liability. When discounting is used,
the increase in the provision due to the passage of
time is recognised as a finance cost.

Warranties

Provisions for warranty related costs are recognised
when the product is sold. Initial recognition is
based on historical experience i.e. claims received
up to the year end and the Management's
estimate of further liability to be incurred in this
regard during the warranty period, computed on
the basis of past trend of such claims. The initial
estimate of warranty related costs is revised
annually.

Liquidated Damages

Liquidated damages on supply of materials are
provided based on the contractual obligations,
deduction made by the customers, as the case may
be based on Management's best estimate of the
expenditure required to settle the obligations.

Litigations, Claims and Contingencies

The Management estimates the provisions for
pending litigations, claims and demands based on
its assessment of probability for these demands
crystalising against the Company in due course.
Also refer Note 5.14.

Onerous Contract

Provision is recognised for the contract, where
unavoidable cost of meeting the obligation under
the contract exceeds the economic benefits
expected to be received. The unavoidable costs
under a contract reflect the least net cost of exiting
from the contract, which is the lower of the cost
of fulfilling it and any compensation or penalties
arising from failure to fulfil it.

5.14 Contingencies

A disclosure for contingent liabilities is made when
there is a possible obligation arising from past
events, the existence of which will be confirmed
only by the occurrence or non-occurrence of one
or more uncertain future events not wholly within
the control of the Company or a present obligation
that arises from past events where it is either not
probable that an outflow of resources embodying
economic benefits will be required to settle or a
reliable estimate of the amount cannot be made.

5.15 (a) Embedded Derivatives

Derivatives embedded in a host contract that
is an asset within the scope of Ind AS 109 are
not separated. Financial assets with embedded
derivatives are considered in their entirety
when determining whether their cash flows
are solely payment of principal and interest.

Derivatives embedded in all other host
contract are separated only if the economic
characteristics and risks of the embedded
derivative are not closely related to the
economic characteristics and risks of the host
and are measured at fair value through profit
or loss. Embedded derivatives closely related
to the host contracts are not separated.

(b) Derivative Instruments

The Company enters into certain derivative
contracts to hedge risks which are not
designated as hedges. Derivative instruments
are initially recognised at fair value on the
date a derivative contract is entered into and
are subsequently re-measured to their fair
value at the end of each reporting period,
with changes included in 'Other Income' /
'Other Expenses'.

b) Refer Note 37 for disclosure of contractual
commitments for acquisition of Property, Plant and
Equipment.

c) Refer Note 17 for information on Property, Plant
and Equipment pledged as security by the
Company.

d) Assets pledged as security for term loans availed by an
associate company.

The Company had in earlier years provided Pari Pasu
Security of its land at Bharatpur (Gross book value of
Rs. 169.65 Crores) against a term loan of Euro 50 million
and overdraft facility of Euro 30 million sanctioned by
Bank of Baroda to Titagarh Firema S.p.A, an associate of
the Company, the outstanding balance against which is
Euro 50.13 million as at March 31, 2025.

e) The Company was vested with leasehold land having
gross and net carrying value as at March 31, 2025 of Rs.

27.59 Crores and Rs. 23.47 Crores (March 31, 2024: Rs.

27.59 Crores and Rs. 23.89 Crores) respectively, through
erstwhile Cimmco Birla Limited (subsequently Cimmco
Limited), since merged with the Company pursuant to
order dated September 30, 2020 of Hon'ble National
Company Law Tribunal Board with the appointed date
as April 1, 2019. The land was allotted on lease for a
period of 99 years in 1963. In the year 1998, the said land
was erroneously recorded by the revenue department
as land belonging to the State, a parcel of which was
subsequently allotted to another party. The Company
filed a writ petition before Hon'ble High Court, Madhya
Pradesh against the said erroneous allotment of parcel
of the land which was set aside. The aggrieved party
filed an appeal before Hon'ble Supreme Court which
was dismissed in 2018. The Company had submitted an
application to the relevant authority for changing the
name which was not allowed and an appeal against the
same was preferred before SDO. Further, the Company
has approached the Hon'ble High Court, Gwalior for
restoration of the Company's name in the record of
rights and complete the mutation proceedings in a time
bound manner, since its appeal for the aforesaid was
pending for long time with concerned authority. The
Hon'ble High Court, Gwalior vide its Order dated May 2,
2023 directed the concerned authority to decide on the
Company's representation within a period of four weeks.

Pending action on the aforesaid Order, the Company
received a notice issued by District Industry Centre
(DIC), Gwalior cancelling the said lease. Subsequently,
the Company filed an appeal before the Commissioner
Industries, MSME, Bhopal, who dismissed the said
appeal on October 9, 2023. The Company had preferred
an appeal against the same on November 3, 2023 before
Principal Secretary, Bhopal which was withdrawn later
and a review application was filed in February 2024
with Commissioner Industries, which was decided in
favour of the Company by an Order dated August 2,
2024. However, Hon'ble High Court, Madhya Pradesh
vide its Order dated September 29, 2024 against a Writ
Petition (WP) filed by a third party has restored the
status of aforesaid matter pending further hearing. The
said WP is scheduled to be heard on June 16, 2025. In
the matter of restoration of name in the record of rights,
the concerned authority dismissed the appeal by an
order dated May 9, 2023 against which an appeal was
filed before Divisional Commissioner. However, the
same was dismissed by an order dated December 15,
2023 against which the Company filed a review petition
on April 15, 2024 and the hearing is scheduled on July
7, 2025. No suit of recovery has been filed till date by
the State and the Company continues to have physical
possession of said leasehold land. The Company has
also obtained legal opinion which supports its view that
the Company continues to enjoy substantial subsisting
right of said land which is not yet extinguished and that
the Company can have its name entered in the record of
rights upon disposal of the WP.

f) The land with the Company admeasuring 25.79 acres
was originally part of a larger area of land vested in
erstwhile Titagarh Steels Limited (TSL) from Titagarh
Paper Mills Company Limited (TPMCL) by an order
passed by the Hon'ble BIFR in 1994 sanctioning the
Scheme of Rehabilitation pursuant to which TPMCL
was amalgamated into TSL. In 2003 - 04, the Company
purchased 16.07 acres of land from TSL. Thereafter, in 2006¬
07, TSL got demerged into three entities namely Titagarh
Enterprises Limited (TEL), Titagarh Industries Limited (TIL)
and remaining continued as TSL whereby its land holding
was also bifurcated as per order dated February 1, 2006
passed by the Hon'ble High Court, Calcutta. Subsequently,
in 2009 -10, the Company acquired 9.72 acres from TEL.

The Company has been in absolute possession of the
said land parcel of 25.79 acres using the land for its
business activities (the "said Land") and was appearing
in the Company's books as freehold land. During the
year, the Government of West Bengal, Department of
Land & Land Reforms vide its letter dated May 29, 2024
proposed two options in relation to the aforesaid land
to the Company and two other companies namely TEL
and TIL, viz. to accept the land parcel on a leasehold
basis for a period of 99 years upon payment of salami,
annual rent etc. as prescribed under the West Bengal
Land Reform Act ("WBLR Act") (hereinafter referred to
as "the Consideration"), or to acquire the land parcel
on a freehold basis upon payment of land revenue
in accordance with Section 23 of the WBLR Act. In
June 2024, the Company made payment of Rs. 2.45
Crores towards the consideration for 21.877 acres

of land, while the payment for balance 3.91 acres of
land as confirmed by TEL was made by them, which
will be settled by the Company on finalisation of the
Government's reconciliation and land allocation process.
The Company vide its letter dated May 23, 2025 made
an application to the State Government, indicating
its intention of acquiring freehold rights over the
aforesaid land parcel duly reconciled with the records
of the Government and the books of the Company
after paying the differential payment for such freehold
rights upon completion of the necessary formalities.
Pending the completion of these formalities, the
Company has classified the said land as leasehold in
its books of accounts for the current period, while
continuing to retain physical possession and utilising
the land for business activities.

Information Regarding Investment Properties

The Company's Investment Properties consists of two parcels of land situated at Bharatpur and Malanpur respectively. As at
March 31,2025, fair valuation of the two properties is estimated to be Rs. 13.94 Crores (March 31, 2024: Rs. 12.42 Crores). These
valuations are based on valuations performed by an independent valuer who holds recognised and relevant professional
qualifications. The fair value was derived using the market comparable approach based on recent market prices and the fair
value measurement categorised within Level-3.

The Company has no restrictions on the realisability of its Investment Properties and no contractual obligations to purchase,
construct or develop investment property or for repairs, maintenance and enhancements. There is no income earned or
expenditure incurred by the Company in relation to the Investment Properties.

Significant Increase / (Decrease) in circle rate of land will result in significant higher / (lower) fair valuation of properties.

The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy
together with a quantitative sensitivity analysis as at March 31, 2025 and March 31, 2024 are as shown below:

* The voluntary winding up of Titagarh Singapore Pte Limited (TSPL) at Singapore has already been initiated in the earlier
years in accordance with local laws and the same is expected to be completed in the next year. Accordingly, the financial
statements of TSPL has been prepared on liquidation basis (realisable value).

^A Includes 3 million equity shares pledged by the Company for the loan taken by Titagarh Firema S.p.A (TFA) from Bank of
Baroda U.K. branch.

# Quotation not available, since suspended due to penal reason.

aa Represents following shares pledged with the banks for the cash credit and working capital facility availed by the
Company {Also refer Note 17(b)}:

@ Pledged with the Commercial Tax Officer, Bharatpur as Security Deposit

(a) Valued at exchange rate prevailing on the date of transaction.

(b) Refer Note 43 for determination of fair values.

(c) Refer Note 44 for credit risk and market risk on investments.

(d) On September 16, 2023 the Company and Titagarh Firema SPA ("Firema") formed Titagarh Firema Engineering Services
Private Limited (TFESPL) to carry on the business of research, engineering and design related services to support
passenger rail segment business. The Company had invested Rs. 1.96 Crores in TFESPL till March 31, 2024. During the
year, the Company has subscribed to the rights issue of equity shares of TFESPL amounting to Rs. 2.00 Crores and has also
amended the Joint Venture Agreement (JVA), as a result of which TFESPL has become a subsidiary of the Company w.e.f.
February 14, 2025.

(e) On June 9, 2023, the Company and Ramkrishna Forgings Limited ("RKFL") formed a JV, Ramkrishna Titagarh Rail Wheels
Limited (RTRWL) for manufacturing and supply of forged wheels under long term agreement under Aatma Nirbhar
Bharat. The Company had invested Rs. 61.25 Crores in RTRWL till March 31,2024. During the year the Company has made
further investment of Rs. 107.80 Crores in RTRWL.

Further, during the year, the Company has also given a financial undertaking to the consortium bankers of RTRWL
whereby in the event of any default or shortfall in repayment of loans taken by RTRWL, the Company in proportion to its
holding, arrange / bring in funds to meet any shortfall in cash flow towards repayment of the facility / payment of interest
and any shortfall in cash flow, which at year-end is Rs. 169.74 Crores for Company's share. Accordingly, Rs. 4.93 Crores
representing the difference between the fair value of the financial undertaking and the nil fee charged by the Company
for such financial undertaking has been recognised as deemed investment.

(f) During the previous year on January 24, 2024, the Company and Sidwal Refrigeration Private Limited, a wholly owned
subsidiary of Amber Enterprises India Ltd., entered into a strategic alliance pursuant whereto they had invested Rs. 100.00
Crores each in the equity capital of Shivaliks Mercantile Limited (formerly Shivaliks Mercantile Private Limited) (SMPL), a
joint venture-special purpose vehicle company (Shivaliks / SPV) for making fresh investments into Firema (alongwith fresh
investment by Invitalia, an investment arm of Government of Italy) and to carry on the business of railway components
and subsystems for Rolling Stock. As at March 31, 2025, SMPL held 34.59% (March 31, 2024: 35.12%) of the equity share
capital of Firema. Further, post such infusion in the previous year, the Company held 25.43% equity shares in Firema. In
accordance with IND AS-28 "Investment in associates and Joint venture¹, considering the terms of "Share Subscription
Agreement" like representation in the board of directors, voting rights etc the SMPL became a joint venture of the
Company with effect from February 13, 2024, the date on which final subscription money was paid by the Company.

16 Other Equity (Contd.)

16.1 Securities Premium Account:- Premium received on Equity Shares issued are recognised in the Securities Premium Account. This
reserve is to be utilised in accordance with the provisions of Section 52 of the Act.

16.2 General Reserve:- Under the erstwhile Indian Companies Act, 1956, a general reserve was created through an annual transfer of
net profit at a specified percentage in accordance with applicable regulations. Consequent to introduction of Companies Act, 2013,
the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn though the
Company may transfer such percentage of its profits for the financial year as it may consider appropriate. Declaration of dividend out
of such reserve shall not be made except in accordance with rules prescribed in this behalf under the Act.

16.3 Retained Earnings:- Retained earnings are the profits / (loss) that the Company has earned / incurred till date, less any transfers to
general reserve, dividends or other distributions paid to shareholders. Retained earning includes Remeasurements (Gain) / Loss on
defined benefit plan, net of taxes that will not be reclassified to Statement of Profit and Loss.

16.4 Cash Flow Hedge Reserve Account:- The Company has designated certain foreign currency forward contracts as cash flow hedges
in respect of foreign exchange risks. The cumulative effective portion of gains or losses arising from changes in fair value of hedging
instruments designated as cash flow hedges are recognised in cash flow hedge reserve. Such changes recognised are reclassified to
the Statement of Profit And Loss when the hedged item affects the profit or loss or are included as an adjustment to the cost of the
related non-financial hedged item.

16.5 During the year, ineffective portion of cash flow hedges recognised in the Statement of Profit And Loss amounted to Rs. 0.11 Crores
(March 31,2024: Rs. Nil). The amount recognised in cash flow hedge reserve (net of tax) is expected to impact the statement of profit
and loss as below:

- within the next one year: gain Rs. Nil (March 31,2024: Rs. (0.11) Crores)

- later than one year: gain Rs. Nil (March 31,2024: Rs. Nil)

16.6 Employee Stock Options (ESOPs) Outstanding Account:- Employee Stock Options Outstanding Account relates to stock options
granted by the Company to the employees under the Company's ESOP Scheme. This Account is transferred to Securities Premium or
Retained Earnings on exercise or lapse of vested options.

17 Borrowings (Contd.)

2) Second charge over movable fixed assets, both present and future and immovable properties at Uttarpara (34.84
acres), Titagarh (16.07 acres) and Anandapur (19.38 Cottah). Negative lien on all that pieces and parcels of land
measuring about 9.56 Acres & 9.72 Acres, at Mouza; Titagarh. The above facilities have also been secured by way of
first pari passu pledge & charge on investment in 49,32,940 equity shares of Titagarh Enterprises Limited and 56,850
equity shares of Titagarh Industries Limited. All the mortgages and charges created in favour of the above lenders
rank Pari Passu with consortium member banks.

(c) Cash Credits is repayable on demand and carry an interest rate ranging between 8.05% to 11.25% p.a. (March 31, 2024:
8.45% to 11.50%) linked with MCLR.

(d) Working Capital Demand Loans carry interest ranging from 7.55% to 10.25% p.a. (March 31, 2024: 5.75% to 11.50% p.a. )
and are repayable on demand.

(e) Buyers Credit carry an interest rate ranging from 4.95% to 5.14% p.a. (March 31, 2024: 6.78% p.a.) and is linked to Secured
Overnight Financing Rate (SOFR). The same is repayable over a period of 3 to 6 months.

(f) Supplier Finances carry an interest rate ranging from 7.75% to 8.10% p.a. (March 31, 2024: Nil). The same is repayable over
a period of 3 to 6 months.

(g) As at March 31, 2025, the register of charges of the Company as available in records of the Ministry of Corporate Affairs
(MCA) includes charges that were created / modified for entities which got amalgamated into the Company pursuant
to National Company Law Tribunal Orders in earlier years. There are certain charges which are historic in nature and
it involves practical challenges in obtaining no-objection certificates (NOCs) from the charge holders of such charges,
despite repayment of the underlying loans. Further, certain charges wherein the outstanding loans have been repaid and
the Company has also filed the related Form 17 for satisfaction of Charge in respect thereof in earlier years, but the same
has not been updated in the MCA records. The Company is following up these matters and is in the continuous process
of filing the charge satisfaction e-form with MCA, within the timelines, as and when it receives NOCs from the respective
charge holders.

(h) Term Loans obtained in earlier years have been applied for the purpose for which it has been obtained.

(i) Refer Note 44 for information about market risk and liquidity risk on borrowings.

Notes:

(a) Term Loan of Rs. 37.35 Crores (March 31, 2024: Rs. 49.75 Crores) carrying interest @ 9.40% p.a. (March 31, 2024: 9.05%
p.a.) linked to 1 year MCLR has been availed in the earlier years and is repayable in 16 equal quarterly installments from
June 2024 to March 2028. Above term loan was secured by way of first Pari Passu charge over movable fixed assets, both
present and future and immovable properties at Uttarpara (34.84 acres), Titagarh (16.07 acres) and Anandapur (19.38
Cottah). Negative lien on all that pieces and parcels of land measuring about 9.56 Acres & 9.72 Acres, at Mouza; Titagarh.

(b) Cash Credits and Working Capital Demand Loans of Rs. 301.74 Crores (March 31, 2024: Rs. Nil) were secured by:

1) First charge over entire stocks of raw materials, semi-finished and finished goods, including book debts, bills,
receivables, both present and future, ranking Pari Passu with other participating banks.

(i) Warranties

Provision is made for estimated warranty claims in respect of products sold which are under warranty at the end of the
reporting period. The warranty period ranges between 2 to 3 years. Management estimates the provision based on
contractual terms, historical warranty claims information and any recent trends that may suggest future claims could
differ from historical amounts.

(ii) Loss on Onerous Contract

Provision is made for contracts in which the unavoidable costs of meeting the obligations under the contract exceed the
economic benefits expected to be received under it. Management estimates the provision based on contractual terms
and the present obligation under the contract is recognised and measured as a provision.

(iii) Litigation, Claims and Contingencies

The amounts represent best possible estimates of pending litigations / claims filed by vendors, customers, labours etc and
probable claims arising out of certain tax matters. The timing and probability of outflow and expected reimbursements,
if any, with regard to these matters depends on the ultimate outcome of the legal process or settlement / conclusion of
the matter with the relevant authorities / customers / vendors etc.

(iii) Leave Benefits

The Company provides for accumulation of leave by its employees. The employees can carry forward a portion of the unutilised leave
balances and utilise it in future periods or receive cash in lieu thereof as per the Company's policy. The Company records a provision
for leave benefits in the period in which the employee renders the services that increases this entitlement. This is an unfunded plan.

The total provision recorded by the Company towards these benefits as at year end was Rs. 2.11 Crores (March 31,2024: Rs. 1.02 Crores).
The amount of the provision is presented as current, since the Company does not have an unconditional right to defer settlement
for any of these benefits. However, based on past experience, the Company does not expect all employees to take the full amount of
accrued leave or require payment within the next 12 months. The following amounts reflect leave that is not expected to be taken or
paid within the next 12 months

The above sensitivity analysis are based on a change in an assumption while holding all other assumptions constant. In practice, this is
unlikely to occur, and changes 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 obligation
recognised in the Balance Sheet.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.

(ii) Post-Employment Defined Contribution Plans:

Provident Fund and Employee State Insurance Scheme (ESI)

Certain categories of employees of the Company receive benefits from a provident fund and ESI, a defined contribution plan. Both
the employee and employer make monthly contributions to a government administered fund at specified percentage of the covered
employee's qualifying salary. The Company have no further obligations under the plan beyond its monthly contributions.

(iv) Risk Exposure

Through its defined benefit plans, the Company is exposed to some risks, the most significant of which are detailed below:

(a) Discount Rate Risk

The Company is exposed to the risk of fall in discount rate. A fall in discount rate will eventually increase the ultimate cost of providing
the above benefit thereby increasing the value of the liability.

(b) Salary Growth Risks

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. An increase
in the salary of the plan participants will increase the plan liability.

(c) Demographic Risk

In the valuation of the liability, certain demographic (mortality and attrition rates) assumptions are made. The Company are exposed
to this risk to the extent of actual experience eventually being worse compared to the assumptions thereby causing an increase in the
benefit cost.

36 The Board of Directors of the Company at its meeting held on March 21, 2023 approved the Employee Stock Option Scheme
titled "Titagarh Rail Systems Limited Employees Stock Option Scheme 2023" for the employees. Subsequently, on April 26,
2023, the shareholders, by way of postal ballot approved the said Scheme. During the current year, the total number of options
granted under the Scheme is 500,000 options which will be granted in one or more tranches over a period of 5 years. Each
option when exercised will be converted into 1 equity share of Rs. 2 each fully paid up. Other terms are -

* Includes Rs. 13.60 Crores (March 31,2024: Rs. 13.60 Crores) which in terms of BIFR order, even if decided against the Company, would stand
at Rs. 1.36 Crores (March 31,2024: Rs 1.36 Crores) only.

In respect of above cases based on favourable decisions in similar cases / legal opinions taken by the Company / discussions with the
solicitors etc., the Management is of the opinion that it is possible, but not probable, that the action will succeed and accordingly no
provision for any liability has been made in the financial statements.

In respect of above contingent liabilities, it is not practicable for the Company to estimate the timings of cash outflows, if any, pending
resolution of the respective proceedings. The Company does not expect any reimbursements in respect of the above.

Also, refer Note 7(e) for financial undertaking given by the Company in respect of borrowings of RTRWL, one of its joint venture.

(ii) Further:

(a) Erstwhile Cimmco Limited (Since merged with the Company) had prior to year 2000, obtained certain advance licenses for making
duty free import of inputs subject to fulfillment of export obligation (EO) within the specified time limit / extended time limit (as
extended pursuant to sanctioned scheme of BIFR) from the date of issuance of such licenses. However, in absence of complete
list of licenses along with the imports made against each license, the amount of contingent liability towards custom duty saved
on unfulfilled export obligations and penal interest if any, is presently unascertainable.

(b) SBI Caps has raised a claim of Rs. 11.29 Crores on erstwhile Cimmco Limited (since merged with the Company) on account of
disallowance of depreciation by the income tax authorities on the wagons leased by SBI Caps to erstwhile Cimmco Limited (since
merged with the Company) which in turn has been sub leased to Indian Railways. The same pertains to the assessment year 1998
- 99 to 2004 - 05 (period prior to change of management in terms of the BIFR order) and the matter is pending with ITAT Mumbai.
As per the separate lease agreements entered between SBI CAPS, erstwhile Cimmco Limited (since merged with the Company)
and Indian Railways, any claims, charges, duties, taxes and penalties as may be levied by the Government or any other authority
pertaining to leased wagons shall be borne by the Indian Railways. Considering the above terms contained in the above agreements
and also Favourable ITAT judgments regarding the admissibility of the depreciation on the leased assets, the Company believes
that there would not be any liability that would crystallise on account of the above.

41 Segment Information

The operating segments based on the Company's products has been identified by the chief operating decision maker, being the Board
of Directors, as "Freight Rail Systems" and "Passenger Rail Systems".

a) Freight Rail Systems - Consists of manufacturing of Wagons, Loco Shells, bogies, couplers, its components, designing and
construction of Warships, Passenger Vessels, Tug and specialised equipment's for Defence, Bridge Girders etc.

b) Passenger Rail Systems - Consists of designing and manufacturing of Metro, Passenger Coaches, EMUs, Train Sets, Mono Rail,
Propulsion equipment, Traction Motors and its components.

Segment performance is evaluated based on profit or loss and is measured consistently with Profit or Loss in the Standalone Financial
Statements. Also, the Company's borrowings (including finance costs to the extent not allocable to segments), income taxes,
investments and derivative instruments are managed at head office and are not allocated to operating segments.

Segment Revenue is measured in the same way as in the Statement of Profit and Loss.

Segment Assets and Liabilities are measured in the same way as in the standalone financial statements.

These asset and liabilities are allocated based on the operations of the segment and physical location of assets.

c) The Company has provided letter of financial support to one of its joint venture namely Titagarh Mermec Private Limited and Shivaliks Mercantile Limited
(formerly Shivaliks Mercantile Private Limited).

d) Also refer Note 6.1(d) to the standalone financial statements.

43 Fair Values

(i) Fair value hierarchy

This section explains the judgments and estimates made in determining the fair values of the financial instruments that are (a)
recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the standalone
financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has
classified its financial instruments into three levels prescribed under the accounting standard. An explanation of each level follows
below.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, over-the counter derivatives) 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 included in level 3.

The Company's policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
There are no transfers between level 1 and level 2 fair value measurements during the year ended March 31, 2025 and March 31, 2024.

(iv) Fair value of financial assets and liabilities

The fair values of financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer a
liability in orderly transaction between market participants at the measurement date. Methods and assumptions used to estimate the
fair values are consistent with those used for the year ended March 31,2024.

43 Fair Values (Contd.)

The methods and assumptions were used to estimate the fair values:

(a) The fair value of foreign exchange forward contracts is determined using forward exchange rates at the Balance Sheet date.

(b) The management assessed that the fair values of remaining financial assets and liabilities at amortised cost approximate to their
carrying amounts largely due to the short-term maturities of these instruments.

(c) For financial assets / liabilities carried at fair value, the carrying amounts are equal to their fair values.

(d) Management uses its best judgment in estimating the fair value of its financial instruments. However, there are inherent
limitations in any estimate technique. Therefore, for substantially all financial instruments, the fair value estimates are not
necessarily indicative of the amounts that the Company could have realised or paid in sale transactions as of respective
dates. As such, fair value of financial instruments subsequent to the reporting dates may be different from the amounts
reported at each reporting date.

44 Financial Risk Management Objectives and Policies

The Company's financial liabilities comprise borrowings, trade payables and other financial liabilities. The main purpose of these

financial liabilities is to finance the Company's operations. The Company's financial assets include trade and other receivables, cash

and cash equivalents, investments and other financial assets.

The Company's Board of Directors ensures that risks are identified, measured and managed in accordance with Risk Management

Policy of the Company and also reviews these risks and related risk management policy, which are summarised below.

I) Market Risks

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

(i) Foreign currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign
exchange rates. The Company's exposure to the risk of changes in foreign exchange rates relates primarily to the Company's
operating activities and borrowings. Such foreign currency exposures are primarily hedged by the Company through use of
foreign exchange forward contracts. The Company has a treasury team which continuously monitors the foreign exchange
fluctuations on a continuous basis and advises the Management of any material adverse effect on the Company, and any
additional remedial measures to be taken.

(ii) Equity price risks

Equity price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in equity
prices (other than those arising from interest rate or foreign exchange rate risk), whether those changes are caused by factors specific
to the individual financial instrument or its issuer, or by factors affecting all similar financial instruments traded in the market.

The Company only invests in the equity shares of the subsidiaries, associates, joint ventures and some of the group companies as
part of the Company's overall business strategy and policy. The Company manages the equity price risk through placing limits on
individual and total equity investment in each of the subsidiaries, associates, joint ventures and group companies based on the
respective business plan of each of the companies. Reports on the investment portfolio along with the financial performance of the
subsidiaries, associates, joint ventures and group companies are submitted to the Company's Management on a regular basis. The
Company's Board of Directors reviews and approves all investment decisions.

The Company's investment in quoted equity instruments (other than subsidiaries) is not material. For sensitivity analysis of Company's
investments in equity instruments, Refer Note 43(ii).

(iii) Interest rate risks

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market
interest rates. The Company's exposure to risk of changes in market interest rates relates primarily to the Company's debt interest
obligation. Further the Company engages in financing activities at market linked rates, any changes in the interest rate environment
may impact future rates of borrowings. The Company continuously monitors the situation and takes remedial actions if required. The
Company's investments in term deposits with bank are carried at amortised cost. They are therefore not subject to interest rate risk as
defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of changes in market interest
rates.

44 Financial Risk Management Objectives and Policies (Contd.)

For the current year, the Company has evaluated that the historical loss rate for passenger rolling stock and related party receivables is
Nil. In respect of the previous year, the historical loss rate for passenger rolling stock, freight rolling stock and related party receivables
was Nil. The historical loss rate for the other receivables are given below:

II) Credit risks

Credit Risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a
financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its investing
activities (primarily deposits with banks). The Company's maximum exposure to credit risk for the components of the Balance Sheet as
at March 31,2025 and March 31,2024 is their carrying amounts except for the financial guarantees.

(a) Trade receivables and contract assets

Customer credit risk is managed by the Company through established policy and procedures and controls relating to customer credit
risk management. The Company applies the simplified approach to determine the expected credit loss (ECL) for trade and other
receivables by considering historical credit loss experience (historical default rates) further adjusted for forward looking information.
In addition Company also considers allowance for credit loss for trade and other receivable based on specific identification method
on a case to case basis with reference to the customer's credit quality, prevailing market conditions etc. As the risk profiles of the
receivables is diverse, to calculate expected credit loss, the Company groups its trade receivables and contract assets by category of
customers i.e. passenger rolling stock, freight rolling stock, shipbuilding, bridges and defence and related parties. At every reporting
date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed. This change did not
have a material impact on the profit for the year ended March 31,2025.

III) Liquidity Risks

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding
through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due
to dynamic nature of the underlying businesses, Company treasury maintains flexibility in funding by maintaining availability under
committed credit lines. The Company has obtained fund and non-fund based working capital lines from various banks.

The Company invests its surplus funds in bank fixed deposits, which carry no market risk. Management monitors the Company's net
liquidity position through rolling forecasts on the basis of expected cash flows. The Company's objective is to maintain a balance
between continuity of funding and flexibility through the use of cash credits, bank loans among others.

45 Capital Management

(a) Risk Management

The Company's objective when managing capital (defined as net debt and equity) is to safeguard the Company's ability to continue as
a going concern in order to provide returns to shareholders and benefits for other stakeholders, while protecting and strengthening
the balance sheet through the appropriate balance of debt and equity funding. The Company manages its capital structure and makes
adjustments to it, in light of changes to economic conditions and strategic objectives of the Company.

The Company monitors capital on the basis of the net debt to equity ratio. Net debt are borrowings as reduced by cash and cash
equivalents. The Company is not subject to any externally imposed capital requirements.

The following table summarises the capital of the Company:

47.1 The aggregate amount of the transaction price allocated to the remaining performance obligation, which are partially or fully
unsatisfied as at year end is Rs. 6,189.65 Crores (March 31, 2024 : Rs. 6,598.66 Crores) and the entity will recognise this revenue as the
contract is completed and / or executed, which is expected to occur over the next 12 - 68 months.

Trade receivables in respect of contract with customers has been included in Note 11.

48.1 The Company has evaluated the impact of the Supreme Court Judgment in case of "Vivekananda Vidyamandir And Others Vs The
Regional Provident Fund Commissioner (II) West Bengal" and the related circular (Circular No. C-I/1 (33)2019/Vivekananda Vidya
Mandir/284) dated March 20, 2019 issued by the Employees' Provident Fund Organisation in relation to non-exclusion of certain
allowances from the definition of "basic wages" of the relevant employees for the purposes of determining contribution to provident
fund under the Employees' Provident Funds & Miscellaneous Provisions Act, 1952 and in the assessment of the management, the
exposure is not material.

48.2 (i) Details of benami property held

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

(ii) Wilful defaulter

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

(iii) Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

(iv) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013.

(v) Compliance with approved scheme(s) of arrangements

The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial
year.

vi) Utilisation of borrowed funds and share premium:-

(A) During the current year, the company has not advanced or loaned or invested funds to any other person(s) or entity(ies),
including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a. Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of
the Company (Ultimate Beneficiaries) or b. Provide any guarantee, security or the like to or on behalf of the Ultimate
Beneficiaries.

(B) During the current year, the company has not received any fund from any person(s) or entity(ies), including foreign entities
(Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

a. Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of
the Funding Party (Ultimate Beneficiaries) or

b. Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

In respect of the previous year, the Company had invested Rs. 100.00 Crores in Shivaliks Mercantile Limited (formerly
Shivaliks Mercantile Private Limited) (SMPL) for onward investments in Titagarh Firema S.p.A (TFA) of which Rs. 90.13
Crores had been invested by SMPL in TFA by year ended March 31, 2024. This arrangment was in accordance with
the Share Subscription Agreement dated January 24, 2024 between Sidwal Refrigeration Industries Private Limited,
Titagarh Rail Systems Limited, Shivaliks Mercantile Limited (formerly Shivaliks Mercantile Private Limited) and Shri.
Umesh Chowdhary.

48 (Contd.)

(vii) 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.

(viii) 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.

(ix) Valuation of PPE, intangible asset and investment property

The Company has not revalued its Property, Plant and Equipment (including right-of-use assets) or intangible assets or both
during the current or previous year.

(x) The Company has one unregistered Core Investment Company [Shivaliks Mercantile Limited (formerly Shivaliks Mercantile
Private Limited)] as a part of the group.

49 The Company has made investments in Titagarh Firema SpA (Firema), an associate company based in Italy (directly and indirectly
through Shivalik Mercantile Limited, a joint venture Company owning 40.86% equity in Firema), having a carrying value of Rs. 112.73
Crores as at balance sheet date. The Government of Italy, through its investment agency, Invitalia owns 30.30% equity shares of
Firema. Post recapitalisation in February 2024 by both the shareholders and owing to a healthy order book, Firema was in the process of
revival by ramping up its operations, however, due to completely unexpected and unforeseen developments which were outside and
beyond the control of Firema, including disputes raised by one of the largest customer of Firema who interalia suspended payments
of all invoices, resulted in a severe cash crunch causing significant operational and financial problems for Firema.

Firema with the support of the Ministry of Enterprise, Government of Italy, have been actively trying to find a resolution to the
aforesaid problems. Ministry of Enterprise, vide its minutes of meeting dated May 5, 2025, has indicated possibility of inducting new
equity investors including acquisition of the majority stake of Firema by private and/or governmental entities, including the State
Railways of Italy.

Meanwhile, in compliance with the relevant laws of Italy regulating companies in financial difficulties, the Board of Directors of
Firema, approved the initiation of necessary protection procedures under the Italian Crisis Code - Composizione Negoziata della
Crisi (CNC) and also formulated a restructuring plan, which was filed on May 14, 2025 with the Chamber of Commerce and was also
admitted by the Court of Naples on May 27, 2025. Pursuant to the above, an independent expert has been appointed by the relevant
authority to evaluate the possibility of the restructuring and revival under the CNC process. Despite the risks and uncertainties
associated with such a process, including the ongoing discussion with the Ministry of Enterprise and in view of the facts stated
above, pending final outcome, it is not possible to ascertain potential impairment, if any, on the direct and indirect investment by the
Company into Firema as at the balance sheet date.

51 Research and Development expenditure of revenue nature recognised in Profit and Loss during the year amounts to Rs. Nil (March 31,
2024: 1.44 crores).

52 The Board at its meeting held on March 17, 2023 approved change of name of the Company to Titagarh Rail Systems Limited to better
reflect the current business activities and after shareholders approval obtained on April 27, 2023 the necessary forms were filed with
MCA. The approval for the same was received and the name change was effective from May 19, 2023.

53 Rs. 0.00 across the standalone financial statements represents figures below rounding off norm.

54 The Code on Social Security, 2020 ('Code') relating to employee benefits during employment and post employment received Indian
Parliament approval and Presidential assent in September 2020. The Code has been published in the Gazette of India and subsequently
on November 13, 2020 draft rules were published and invited for stakeholders' suggestions. However, the date on which the Code will
come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any
related impact in the period the Code becomes effective.

For Price Waterhouse & Co. Chartered Accountants LLP For Salarpuria & Partners For and on behalf of the Board Of Directors of Titagarh Rail Systems Limited

Firm Registration No.: 304026E / E-300009 Firm Registration Number: 302113E (formerly Titagarh Wagons Limited)

Chartered Accountants

Pramit Agrawal Anand Prakash J. P. Chowdhary Umesh Chowdhary

Partner Partner Executive Chairman Vice Chairman and Managing Director

Membership No. 099903 Membership No. 056485 DIN: 00313685 DIN: 00313652

Place: Kolkata Place: Kolkata Place: Kolkata Place: Kolkata

Date: May 30, 2025 Date: May 30, 2025 Date: May 30, 2025 Date: May 30, 2025

Atul Ravishanker Joshi Anil Kumar Agarwal

Independent Director Deputy Managing Director

DIN: 03557435 DIN: 01501767

Place: Mumbai Place: Kolkata

Date: May 30, 2025 Date: May 30, 2025

Saurav Singhania Dinesh Arya

Chief Financial Officer Company Secretary

Place: Kolkata Place: Kolkata

Date: May 30, 2025 Date: May 30, 2025