b) Terms/ rights attached to equity shares:

The company has only one class of equity shares having a par value of H 5 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The final dividend(if any) 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. The distribution will be in proportion to the number of equity shares held by the shareholders. During the year, the company had declared and paid first Interim dividend of H 6/- per share for FY 2025-26 and has declared second interim dividend of H 8.50 /- per share for FY 2025-26.

A) Nature of Securities :

i) Term Loan Facility from Indusind Bank is secured by Fixed Deposit of H 54.77 lakh (March 31, 2025: H 83 lakh )

ii) Term loans from HDFC Bank are secured by charge over assets financed by term Loan, Immovable Properties of the company situated at (i) Plot No. 51, Sector 32, Gurugram.

iii) Term loans from Canara Bank are secured by charge over assets financed by term Loan, Land & building, Plant & Machinary at Survey No. 32/8, 31/5A3, 31/5B3, 31/8CIB, 31/8C2, 31/13P, 31/14, 31/15 Melavalam Village, Madurantakam Taluk, Kancheepuram District, TamilNadu. and Personal Guarantee of Dr. Deepak Kumar Seth and Mr. Pulkit Seth (Promoter Directors).

iv) Emergency credit line guaranteed scheme (ECLGS 2.0) & ECLGS 2.0 (Extension) facilities are secured by second charge over securities provided for base credit facility, except personal guarantees.

v) Vehicle Loans are secured by Hypothecation over the Vehicle financed by respective loan.

A. Securities for Working Capital Facilities under Consortium Arrangement

i) Primary Securities offered includes:

a) First Pari-Passu Charge by way of hypothecation of the entire current assets both present and future , including but not limited to stocks of raw materials, semi finished and finished goods, raw material, book debts and stock, loans and advances etc.

b) First Pari-Passu charge by way of hypothecation over the entire movable fixed assets belonging to the Borrower, except any assets charged to any banks/financial institutions for securing the terms loans.

ii) Collateral Securities offered includes:

a) First pari passu charge over Immoveable properties of the company situated at (i) Plot No. 16/17, Udyog Vihar, Phase VI, Gurugram, (ii) Plot No. 751, Pace City-II, Sector 37, Gurugram & (iii) Survey No. 30(P), 31(P), 32(P) & 262(P), Ward no 02 in Arryapakkam Village, Madurantakam Taluk, Kancheepuram District, TamilNadu.

b) Irrrevocable and unconditional personal guarantee of Dr. Deepak Kumar Seth (Promoter Director) and Mr. Pulkit Seth (Promoter Director).

iii) Refer Note No. 21 for the terms and conditions, nature of security and maturity profile of the current maturities of longterm borrowings (forming part of long term borrowings of the Company).

iv) Short Term borrowing includes 4,632.53 lakhs of Trade Payable as a part of vendor financing arrangement for which creditors have already been paid to that extent. The company pays the bank within 90 days under this arrangement and trade payable are usually paid in 90 days (except MSME which are paid within 45 days).

B. Securities for Working Capital Facilities by HDFC Bank (Adhoc Outside Consortium)

a) Exclusive Charge over corpotate office (Land and Building) situated in Gurugram, Haryana.

C. For interest rate & liquidity risk related disclosures, (refer note 44).

D. In respect of working capital loans, quarterly returns or statements of current assets filed by the company with banks are materially in agreement with the books of account.

e) Disclosure of payable to vendors as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is based on the information available with the Company regarding the status of registration of such vendors under the said Act and as per the intimation received from them on requests made by the Company. There are no overdue principal amounts / interest payable amounts for delayed payments to such vendors at the Balance Sheet date except disclosed above.

f) The Company's exposure to market and liquidity risk related to trade payables are disclosed in Note no. 44.

The maturity analysis of lease liabilities is given in Note 44 in the 'Liquidity risk' section.

Cash flows from operating activities includes cash flow from short term lease & leases of low value. Cash flows from financing activities includes the payment of interest and the principal portion of lease liabilities.

Leases committed and not yet commenced: There are no leases commited which have not yet commenced as on reporting date. Company as a Lessor

The Company accounted for its leases in accordance with Ind AS 116 from the date of initial application. The Company does not have any significant impact on account of sub-lease on the application of this standard.

The Company has given its building space, lying under property, plant and equipments, on operating lease through operating lease arrangements. Income from operating leases is recognised as revenue on a straight-line basis over the lease term.

Lease income of H 658.84 lakh (March 31, 2025: H 875.09 lakh) has been recognised and included under Other Income. (Refer Note No. 30)

a) Performance obligation

Revenue is recognised upon transfer of control of products.

During the year, The Company has not entered into long term contracts with Customers and accordingly disclsoure of unsatisfied or remaining performance obligation (which is affected by several factors like changes in scope of Contracts, periodic revalidations, adjustment for revenue that has not been materialized, tax laws etc.) is not applicable to the Company.

b) Disaggregation of revenue: The table below presents disaggregated revenues from contracts with customers on the basis of geographical spread of the operations of the Company. The Company believes that this disaggregation best depicts how the nature, amount of revenues and cash flows are affected by market and other economic factors:

During the year, the Company incurred H 77.53 lakh towards CSR activities. Against the CSR obligation of H 54.89 lakh for FY 2025-26, the Company has utilised excess CSR spend available for set-off amounting to H 688.83 lakh in accordance with Rule 7(3) of the Companies (CSR Policy) Rules, 2014, arising from excess expenditure incurred under Section 135(5) of the Companies Act, 2013 in earlier years.

The unutilised set-off balance pertaining to FY 2022-23 amounting to H 6.83 lakh lapsed during the year, as the same was no longer eligible for carry forward under the applicable CSR provisions.

As at March 31, 2026, the balance eligible for set-off amounting to H704.64 lakh has been disclosed in prepaid expenses under other assets head and H 61.72 lakh has been charged to the Statement of Profit and Loss during the year.

b) Defined benefit plans

In accordance with Ind AS 19 "Employee benefits", an actuarial valuation on the basis of "Projected Unit Credit Method" was carried out, through which the Company is able to determine the present value of obligations. "Projected Unit Credit Method" recognizes each period of service as giving rise to additional unit of employees benefit entitlement and measures each unit separately to built up the final obligation.

i) Gratuity scheme

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the Act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the member's length of service and salary at retirement age. The gratuity is funded in current year for all the units and maintained by Life Insurance Corporation of India.

ii) Other long term employee benefits

As per the Company's policy, eligible leaves can be accumulated by the employees and carried forward to future periods to either be utilised during the service, or encashed. Encashment can be made during the service on early retirement, on withdrawal of scheme, at resignation by employee and upon death of employee. The scale of benefits is determined based on the seniority and the respective employee's salary. The Company records an obligation for such compensated absences in the period in which the employee renders the services that increase this entitlement. The obligation is measured on the basis of independent actuarial valuation using the projected unit credit method.

Re-measurements, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding interest and if applicable), is reflected immediately in Other Comprehensive Income in the statement of profit and loss in case of Gratuity. All other expenses related to defined benefit plans are recognised in statement of profit and loss as employee benefit expenses. Re-measurements recognised in Other Comprehensive Income will not be reclassified to statement of profit and loss hence it is treated as part of retained earnings in the statement of changes in equity. Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment or settlement occurs. Curtailment gains and losses are accounted for as past service costs.

No changes were made in the objectives, policies or processes for managing capital during the years ended March 31, 2026 and March 31, 2025.

In order to achieve overall objective, the Company's capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Further, there have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current financial year & immediately preceding financial year.

Note 42 : Derivative instruments and unhedged foreign currency exposure

I) Hedge Accounting

(i) The Company enters into hedging instruments in accordance with policies as approved by the Board of Directors with written principles which is consistent with the risk management strategy of the Company. The Company has decided to apply hedge accounting for certain derivative contracts that meets the qualifying criteria of hedging relationship. Hedging strategies are decided and monitored periodically by Chief Financial Officer and Board of Directors of the Company.

Cash Flow Hedges

Foreign exchange forward contracts are designated as hedging instruments in cash flow hedges of forecasted hedged items in US dollar. These forecast transactions are highly probable. The foreign exchange forward contract balances vary with the level of expected foreign currency sales and changes in foreign exchange forward rates.

The critical terms of the foreign currency forward contracts match the terms of the expected highly probable forecast sale transactions.

The cash flow hedges of the forecasted sale transactions for the year ended March 31, 2026 were assessed to be highly effective and unrealised profit/(loss) of H (475.85) lakh, with a deferred tax asset / (liability) of H 119.76 lakh relating to the hedging instruments, is included in OCI. [March 31, 2025: Unrealised profit of H (179.15) lakh with a corresponding deferred tax asset / (liability) of H 45.09 lakh relating to the hedging instruments, is included in OCI].

Note 43 : Fair value measurements

Financial instruments

a) Financial instruments by category

All other financial assets and liabilities except derivative financial instruments viz. trade receivables, security deposits, cash and cash equivalents, other bank balances, interest receivable, other receivables, trade payables, employee related liabilities and borrowings, are measured at amortised cost. Derivative financial instruments are measured at fair value through other comprehensive income.

b) 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 the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.

d) Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows.

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

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

There have been no transfers in either direction for the year ended 31 March 2026 and 31 March 2025.

e) Fair value of financial assets and liabilities measured at amortised cost

The carrying amounts of short-term trade and other receivables, trade payables, cash and cash equivalents and other bank balances are considered to be the same as their fair values, due to their short-term nature.

For other financial liabilities/ assets that are measured at fair value, the carrying amounts are equal to the fair values.

^Discount rate used in determining fair value

The interest rate used to discount estimated future cash flows, where applicable, are based on the incremental borrowing rate of borrower which in case of financial liabilities is average market cost of borrowings of the Company and in case of financial asset is the average market rate of similar credit rated instrument. The company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available.

Note 44 : Financial risk management objectives and policies

The Company's principal financial liabilities comprises of trade and other payables, borrowings, current maturity of borrowings, interest accrued and capital creditors. The main purpose of these financial liabilities is to finance the Company's operations and to provide guarantees to support its operations. The Company's principal financial assets includes loans to related parties, security deposits, trade receivables, cash and cash equivalents, deposits with bank, interest accrued in deposits, receivables from related and other parties and interest accrued thereon.

The Company has exposure to the following risks arising from financial instruments:

- credit risk,

- liquidity risk and

- market risk.

The Company's senior level management oversees the management of these risks and is supported by finance department that advises on the appropriate financial risk governance framework.

The Company's principal financial assets includes loans to related parties, security deposits, trade receivables, cash and cash equivalents, deposits with bank, interest accrued in deposits, receivables from related and other parties and interest accrued thereon.

A. Credit risk

Credit risk is the risk that counterparty will default on its contractual obligations resulting in finance loss to the Company.

Credit risk arise from Cash and cash equivalents, deposit with banks, trade receivables and other financial assets measure

at amortised cost. The Company continuously monitors defaults of customers and other counterparties and incorporate this

information into its credit risk control.

(i) Trade Receivables

The Company's exposure to credit risk is influenced mainly by the individual characteristics of each customer. The credit risk is managed by the Company based on credit approvals, establishing credit limits and continuosly monitoring the credit worthiness of the customers, to whom the Company grants credit period in the normal course of business inlcuding taking credit insurance against export receivables. The Company uses expected credit loss model to assess the impairement loss in trade receivables and makes an allowance of doubtful trade receivables using this model.

(ii) Other Financial Assets: The Company maintains exposure in cash & cash equivalents, term deposits with banks, investments, advances and security deposits etc. Credit risk from balances with banks, investment in mutual funds and loan to related parties is managed by the Company's treasury department in accordance with the Company's policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Company's Board of Directors on an annual basis and may be updated throughout the year subject to approval of the Company's finance committee. The Company's maximum exposure to the credit risk as at March 31, 2026 and March 31, 2025 is the carrying value of each class of financial assets.

(iii) Exposure to Risk, in respect of the guarantees given by the Company: The disclosure in respect of credit risk exposures which are not credit impaired or where there has not been a significant increase in credit risk since initial recognition are as under:

- Policy of managing risk: To assess whether there is a significant increase in credit risk the Company compares the risk

of default as at the reporting date with the risk of default as at the date of initial recognition. The Company considers reasonable and supportive forward-looking information such as significant changes in the value of guarantee or in the quality of exposure or credit enhancements.

B. Liquidity risk

Liquidity risk is the risk that the Company may not be able to meet its present and future cash and collateral obligations without incurring unacceptable losses.

The Company's objective is to, maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company closely monitors its liquidity position and deploys a robust cash management system. It maintains adequate sources of financing including loans from banks at an optimised cost.

C. Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates will affect the Company's income. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, equity prices and other market changes that affect market risk sensitive instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return. The Board of Directors is responsible for setting up the policies and procedures to manage risks of the Company.

i) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company's exposure to the risk of changes in market interest rates relates primarily to the Company's long-term debt obligations with floating interest rates. The Company manages its net exposure to interest rate risk related to borrowings, by balancing a proportion of fixed rate and floating rate borrowing in its total borrowing portfolio.

Interest Rate Sensitivity: The sensitivity analysis in the following sections relate to the position as at March 31, 2026 and March 31, 2025. The following table demonstrates the sensitivity to a reasonably possible change in interest rates on the portion of borrowings affected. With all other variables held constant, the Company's profit before tax is affected through the impact on floating rate borrowings, as follows:

The assumed movement in basis points for the interest rate sensitivity analysis is based on the currently observable market environment, showing a significantly higher volatility than in prior years.

ii) Foreign currency risk

The Company is exposed to foreign currency risk on certain transactions that are denominated in a currency other than entity's funactional currency, hence exposure to exchange rate fluctuations arises. The risk is that the functional

currency value of cash flows will vary as a result of movements in exchange rates. The following tables demonstrate the sensitivity (strengthening or weakening of Indian Rupee) to a reasonably possible change in exchange rates, with all other variables held constant.

Note 45 : Segment Information

a) The Company's operating segments are established on the basis of those components that are evaluated regularly by the Executive Committee (the 'Chief Operating Decision Maker' as defined in Ind AS 108- 'Operating Segments'). In light of Para 4 of Ind AS 108- Operating Segments, the Company has presented segment information on geographical basis in its consolidated financial statements.

b) Revenue from major customer: During the year, the Company generates 90% of its external revenues from 11 customers (March 31, 2025: 8 customers).

Note 46 : Contingent liabilities and commitments

a) Contingent liabilities (To the extent not provided for)

I (i) The company has reviewed all its pending claims, litigations and other proceedings and has adequately provided for wherever required. The company does not expect the outcome of these proceedings to have a material or adverse effect on financial position of the company. In certain cases, it is difficult for the company to estimate the timings of cash outflows, if any, as it is determinable only on receipt of judgement/decisions pending with various forums/ authorities. The company does not expect any reimbursements in respect of the below contingent liabilities.

d) Terms and conditions of transactions with related parties

All the transaction with the 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 except the interest bearing loan and settlement occurs in cash.

e) Personal Guarantee given by Dr. Deepak Kumar Seth (Promoter Director) and Mr. Pulkit Seth (Director) against the Borrowings (refer note no. 21 & 22).

f) The remuneration of Key managerial Personnel does not include amount in repect of gratuity and leave encashment payable as the same are not determinable as individual basis for the KMP. The liabilities of gratuity and leave encashment are provided for Company as whole on the basis of acturial valuation.

g) During the year, Pearl Global (HK) Limited, a wholly owned subsidiary of Pearl Global Industries Limited, has incorporated a Subsidiary with name i.e. Pearl Global Fashion Singapore Pte Limited in Singapore. Consequently, Pearl Global Fashion Singapore Pte Limited has become a step-down subsidiary of the Company with effect from March 27, 2026.

h) During the year, the Group has acquired additional 5% Equity interest in PT Pinnacle Apparels.Consequently. Company's stake in the Subsidiary has been increased to 89.93% from 84.93%.

Further, the Holding Company through its Step-Down Subsidiary, DSSP Global Limited, Hong Kong, will be acquiring an additional 9.99% stake from the Minority Shareholder in PT Pinnacle Apparels for a consideration of USD 1.406 Million. The investment is of a strategic nature for increase in shareholding. The entire acquisition will be funded from Internal accruals. Post this acquisition, the Company through its Step-Down Subsidiary, DSSP Global Limited, Hong Kong will be holding 99.92% stake in PT Pinnacle Apparels.

(b) No other material events have occurred between the balance sheet date to the date of issue of these financial statements that could affect the values stated in the financial statements.

Note 50 : Audit Trail

The company is maintaining its books of account in electronic mode and the back-up of books of account has been maintained on a daily basis. The company has used accounting software for maintaining its books of account for the financial year ended March 31, 2026 which has a feature of recording audit trail (edit log) facility and such facility has operated throughout the year for all relevant transactions recorded in the software, except that the audit trail feature at the database level for direct changes, if any, was not enabled.

Further, there were no known instances of tampering with the audit trail feature during the year and the audit trail has been preserved by the company as per statutory requirements for record retention.

a) Net Profit after taxes Non-cash operating expenses like depreciation and other amortizations Interest other adjustments like loss on sale of Fixed assets etc. "Net Profit after tax" means reported amount of "Profit / (loss) for the period" and it does not include items of other comprehensive income.

b) Interest, Lease Payments and Principal Repayments of long term debt

c) Current assets - Current liabilities

d) Tangible Net Worth Total Debt(excluding lease liabilities in debt) Deferred Tax Liability

e) Tangible Net Worth Total Debt(including lease liabilities in debt) Deferred Tax Liability

f) Reasons have been explained for variance in which % change is more than 25% as compared to ratio of previous year.

Note 52: Employee Share Based Payment

A. The Board of Directors had accorded their consent for the implementation of Pearl Global Industries Limited Employee Stock Option Plan 2022 (the Plan) on June 30, 2022 which was approved by the shareholders of the company vide Postal Ballot on August 28, 2022. Pursuant to the terms of the said plan, the company had granted 14,19,800 options till date to eligible employees of the company/ subsidiary company. During the year ended March 31, 2026, the company has granted 4,500

(March 31, 2025: 1,35,100) stock options to the eligible employees of the company/subsidiary companies. Each option when exercised would be converted into one fully paid-up equity share of H 5/- each of the company. The options granted under ESOP scheme carry no rights to dividends and no voting rights till the date of exercise. The fair value of the share options is estimated at the grant date using Black and Scholes Model, taking into account the terms and conditions upon which the share options were granted.

Further,during the year ended March 31, 2026, the company has accelerated the vesting of 400 options (March 31, 2025: 3,200) based on the approval of Nomination and Remuneration Committee in accordance with 'the Plan', due to which an additional amount of H 0.01 lakh (March 31, 2025: H 0.05 lakh) has been charged to statement of profit and loss account.

The company has recognised an expense of H 321.23 lakh (March 31, 2025: H 573.99 lakh) arising from equity settled share based payment transactions for employee services received during the year. The carrying amount of Employee stock options outstanding reserve as at March 31, 2026 is H 418.87 lakh (March 31, 2025: H 1,303.91 lakh).

Note 53 : Pursuant to transfer pricing legislations under the Income-tax Act, 1961, the Company is required to use specified methods for computing arm's length price in relation to specified international transactions with its associated enterprises. Further, the Company is required to maintain prescribed information and documents in relation to such transactions. The appropriate method to be adopted will depend on the nature of transactions/ class of transactions, class of associated persons, functions performed and other factors, which have been prescribed.The Company is in the process of updating its transfer pricing documentation for the current financial year. Based on the preliminary assessment, the management is of the view that the update would not have a material impact on the tax expense recorded in these financial statements. Accordingly, these financial statements do not include any adjustments for the transfer pricing implications, if any.

Note 54 : No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity ("Intermediaries") with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries).

The Company has not received any fund from any party (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entity identified by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Note 55: Disclosure of transactions with struck off companies

The company did not have any material transactions with companies struck off under Section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956 during the financial years.

Note 56 :

A) No transactions to report against the following disclosure requirements as notified by MCA pursuant to amended Schedule III:

(a) Crypto Currency or Virtual Currency

(b) Benami Property held under Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder

(c) Registration of charges or satisfaction with Registrar of Companies.

(d) Relating to borrowed funds:

i) Wilful defaulter

ii) Utilisation of borrowed funds & share premium

iii) Borrowings obtained on the basis of security of current assets

iv) Discrepancy in utilisation of borrowings

Note 57 : Figures have been rounded off to the nearest lakh upto two decimal places except otherwise stated.