a) Allowance for bad & doubtful debts is created in accordance ‘expected credit loss’ model prescribed under Ind AS 109.

b) Trade receivables are non-interest bearing and credit period generally falls in the range of 30 to 120 days terms.

c) The company has some balances of certain customers accumulated over a period of time which became non moving particularly after the pandemic crisis. The same continued to remain non-moving and carried forward from year to year without any major movement due to differences in the claims and counterclaims from the customer. Accordingly the company has further provided Rs.251.54 Lakhs provision during the year and now the total amount of provision stands at Rs.807.24 Lakhs.

Note: During the year, the Company has increased the Authorised Capital from Rs.3000 Lakhs to Rs.6000 Lakhs.

a) Preferential Allotment of Equity Shares:

During the year, the Company has made a preferential allotment of 1,32,49,000 equity shares of face value ?10 each at a premium of ?17.50 per share to certain shareholders, including promoters, on a "preferential allotment basis". The allotment was made to members holding shares as on the record date as announced by the Company.

Pursuant to the allotment, the equity share capital of the Company has increased from ^26,36,72,910 to ^39,61,62,910. The shares have been listed and trading approval has been obtained from the designated stock exchange, BSE Limited.

The entire issue complies with the applicable regulations and was made in accordance with the provisions of the Companies Act, 2013 and SEBI (ICDR) Regulations.

b) Issue of Convertible Equity Share Warrants:

The Company has received 25% of the consideration towards the issue of 1,23,00,000 Convertible Equity Share Warrants (“Warrants”) on a preferential basis to persons belonging to the Promoter and Non-Promoter Category, as approved by the shareholders at the Extraordinary General Meeting held on January 3, 2025.

Pursuant to the above approval, the Board of Directors, at their meeting held on February 12, 2025, allotted 1,23,00,000 Equity Share Warrants having a face value of ?10/- each, at a premium of ?17.50/- per warrant. Each warrant is convertible into one equity share of the Company at the option of the warrant holder, in accordance with applicable regulations and the terms of issue.

The balance amount shall be payable at the time of conversion of warrants into equity shares, within the prescribed time frame in accordance with SEBI (ICDR) Regulations and the Companies Act, 2013.

Fully paid equity shares, which have a par value of Rs. 10, carry one vote per share and carry a right to dividends.

Details of Ordinary (Equity) shares held by shareholders holding more than 5% of the aggregate shares in the Company:

The company has only one class of shares i.e. Equity Shares having a face value of Rs.10/- each. The equity shareholders are entitled to dividend only if dividend in a particular financial year is recommended by the Board of Directors and approved by the members at the annual general meeting of that year. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the 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 share holders.

The Board of Directors has not recommended any dividend for the financial year 2024-25.

Shares reserved for issue under options

960000 shares were reserved for issue under the Employees Stock Option Plan pursuant to a special resolution passed in 20th Annual General Meeting held on 2nd September, 2011. During the year 2024-25, the Company has neither granted any options to any employees nor any options were exercised as there are no options pending which are yet to be exercised. The details of the options granted and exercised in past are as follows.

1) The company has so far allotted 317320 shares.

2) The balance as on 31st March 2025 is 642680 options which is yet to be granted to the employees from reserved portion of the equity capital.

There has been no allotment of shares pursuant to contract(s) without payment being received in (cash during 5 years immediately preceding 31st March, 2025).

Retained Earnings: Created from Profit/loss of the Company, as adjusted for distribution to owners, transfers to other reserves etc.

Securities Premium: Securities premium reserve is created due to premium on issue of shares. These reserve is utilized in accordance with the provisions of the Companies Act, 2013.

Share option outstanding account: Created for recording the grant date fair value of options issued to employees under the Employees stock option schemes & is adjusted on exercise/forfeiture of options.

Items of other comprehensive income: Created for transferring the re-measurements gains & losses on defined benefit plans.

a) During the year the Company has taken Term Loan of Rs.190 Lakhs from Indian Overseas Bank, Fort branch, Mumbai - 400023 for purchase and installation of machinery.

Margin: 25% of Cost of macinery

Interest: RLLR (9.10%) 0.20% (SP) 0.95% (CRP), i.e. 10.25% p.a. presently

Security: Hypothecation of Machinery purchased out of loan and entire Fixed Asset of the

Company.

b) * TUF Loan amounting to Rs.53.10 lakhs is secured by lien marked on Fixed Deposit (Refer Note No.8) by the Company. It is further secured by hypothecation of specific plant & machinery procured by utilization of the loan.

Note: An amount of Rs.4,71,015/-, being unclaimed dividend, has been transferred during the year to the Investor Education and Protection Fund as per applicable Rules and reported to the Registrar of Companies, Ministry of Corporate Affairs.

C1. The amounts receivable from customers become due after expiry of credit period which on an average is less than 180 days. There is no significant financing component in any transaction with the customers.

C2. The Company provides agreed upon performance warranty for all range of products. The amount of liability towards such warranty is immaterial.

C3. The Company does not have any remaining performance obligation as contracts entered for sale of goods are for a shorter duration. There are no contracts for sale of services wherein, performance obligation is unsatisfied to which transaction price has been allocated.

35 Financial Risk Management Objectives & Policy

The Company’s principal financial liabilities comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include loans, trade and other receivables, and cash and cash equivalents that derive directly from its operations. The Company also holds FVTPL investments. The Company is exposed to market risk (including foreign currency risk, interest rate risk and commodity risk, etc.), credit risk and liquidity risk. The Company’s senior management oversees the management of these risks. The Board of Directors reviews Financial Risk

. t* i • r- 1 • • ,1 *1 1*1 *111

1) Market Risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may results from change in the price of a financial instrument. The value of a financial instrument may change as result of change in the interest rates, foreign currency exchange rates, equity prices and other market changes may affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments and deposits, foreign currency receivables, payables and loans and borrowings. Market risk comprises mainly of risks related to changes in foreign currency exchange rates, commodity prices and interest rates. The Company has a moderate risk management system monitored by Risk Management Committee to inform Board Members about

a) Foreign currency risk management

The Company’s functional currency is Indian Rupees (INR). The Company is not having any significant foreign transactions; hence the company is not prone to foreign currency risks as on the date of the balance sheet.

b) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk because funds are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rate. The borrowings of the Company are principally denominated in rupees with a mix of fixed and floating rates of interest. The Company has exposure to interest rate risk, arising principally on changes in base lending rate. The Company uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements for its day-to-day operations. The Company regularly scans the Market & Interest Rate Scenario to find appropriate Financial Instruments & negotiates with the Lenders in order to reduce the effect Cost of Funding. The risk is managed by the Company by

c) Commodity price risk:

The Company’s revenue is exposed to the market risk of price fluctuations related to the sale of its products. Market forces generally determine prices for the products sold by the Company. These prices may be influenced by factors such as supply and demand, production costs (including the costs of raw material inputs) and global and regional economic conditions and growth. Adverse changes in any of these factors may reduce the revenue that the Company earns from the sale of its

products

The Company primarily purchases its raw materials in the open market from third parties. The Company is therefore subject to fluctuations in prices for the purchase of raw materials. The Company purchased substantially all of its textile grade yarn and grey fabrics from third parties in the open market during the year ended 31 March 9095

The Company aims to sell the products at prevailing market prices. Similarly the Company procures key raw materials based on prevailing market rates as the selling prices of its products and the prices of input raw materials move in the same direction.

2) Credit risk management:

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting

in financial loss to the Company. Credit risk encompasses both, the direct risk of default and the

risk of deterioration of creditworthiness as well as concentration risks. The Company has adopted

a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where

appropriate, as a means of mitigating the risk of financial loss from defaults. Company’s credit

risk arises principally from the trade receivables and financial instruments and deposits with 1____

Trade receivables:

Customer credit risk is managed centrally by the Company and subject to established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits defined in accordance with the assessment. Credit risk on receivables from organized and bigger buyers is mitigated by securing the same against letters of credit and guarantees of reputed nationalized and

pr vrtte se ctor bn nks / pa rt advance pay^a apts /post dated abaquaa

The outstanding trade receivables are regularly monitored and appropriate action is taken for collection of overdue receivables. The outstanding from the trade segment is secured by two tier security - security deposit from the dealer himself, and our business associates who manage the dealers are also responsible for the outstanding from any of the dealers in their respective region. Impairment analysis is performed based on historical data at each reporting period on an

Financial Instruments and Deposits with Banks:

The Company considers factors such as track record, size of institution, market reputation and service standards to select the bank with which balances and deposits are maintained. Generally, balances are maintained with the institutions with which the Company has also availed borrowings. The Company does not maintain significant cash and deposit balances other than

those required for its day to day operation

3) Liquidity risk management

Liquidity risk refers to the risk of financial distress or extraordinary high financing costs arising due to shortage of liquid funds in a situation where business conditions unexpectedly deteriorate and requiring financing. The Company requires funds both for short term operational needs as well as for long term capital expenditure growth projects. The Company generates sufficient cash flow for operations, which together with the available cash and cash equivalents and short term investments provide liquidity in the short-term and long term. The Company has established an appropriate liquidity risk management framework for the management of the Company’s short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. The following tables detail the Company’s remaining contractual maturity for its non derivative financial liabilities with agreed repayment periods and its nonderivative financial assets. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. The tables include both interest and principal cash flows. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the end of the

36 Capital Risk Management

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company’s primary objective when managing capital is to ensure that it maintains an efficient capital structure and healthy capital ratios and safeguard the Company’s ability to continue as a going concern in order to support its business and provide maximum returns for shareholders. The Company also proposes to maintain an optimal structure to reduce the cost of capital as well as to maintain proper

For the purpose of the Company’s capital management, capital includes issued capital, securities premium and all other equity reserves. Net debt includes, interest bearing loans and borrowings, less cash & cash Equivalents.

The Company monitors capital using a gearing ratio, which is Net Debt divided by Total Capital plus Net Debt. Net Debt is calculated as total borrowings including short term and current maturities of long term debt.

(a) The above details of consumption consists of Raw materials which are consumed directly for manufacture of finished products and also other items which are indirectly related to manufacture of finished products, i.e. stores, spares and packing materials.

46 Forward Contracts and Unhedged Foreign Currency Outstanding Balances

The company has not executed any forward contract for hedging exchange rate risk; the outstanding unhedged foreign currency balances as on 31st March, 2025 are as under:

(a) The foreign currency outstanding balances that have not been hedged by any derivative instrument or otherwise as at the Balance Sheet date are NIL as at 31st March 2025. (31st March 2024 - NIL).

There is no amount payable in foreign currency outstanding as on 31st March, 2025.

47 Employee Benefits Gratuity:

The Company has a defined benefit gratuity plan governed by the Payments of Gratuity Act, 1972. Every employee who has completed five years or more of services is eligible for gratuity on separation at 15 days salary (last drawn salary) for each completed year of service. The Company has formed a Gratuity Trust to which contribution is made and an insurance policy is taken by the trust, which is a year-on-year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The insurance Company, as part of the policy rules, makes payment of all gratuity outgoes happening during the year (subject to sufficiency of funds under the policy). The policy, thus, mitigates the liquidity risk. However, being a cash accumulation plan, the duration of assets is shorter compared to the duration of liabilities. Thus, the Company is exposed to movement in interest rate, particularly, the significant fall in interest rates, which should result in a increase in liability without corresponding increase in the asset.

The company has classified various employee benefits as under:

(A) Defined Contribution Plans

The company has recognised the following amounts in the Statement of Profit and Loss for the year:

i. Leave Encashment liability is determined by an independent actuary and relevant provisions are made in the books of account. The payment towards the liabilty is made by the company as and when the employee becomes eligible to claim the encashment.

ii. The liability towards gratuity is determined by an independent actuary and the relevant amounts towards gratuity liability is paid by the company to the "Suditi Employees Group Gratuity Trust". The said Trust administers the scheme.

The sales to and purchase from related parties are made in the ordinary course of business and on terms equivalent to those that prevail in arm's length transactions. Outstanding balances at the year end are unsecured and settlement occurs in cash. This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

49 Leases

The company recognizes all the Lease agreements including Leave & License Agreements executed for tenue which is more than one year as per the requirements under Ind AS 116-Leases.

In terms of the provisions of Ind AS 116, the Lease Liability is determined as the present value of lease rentals over the period discounted at the effective interest rate applicable to the Company. An equal amount has been recognised under the head "Property, Plant and Equipment" as a 'Right to Use Asset'. This Right to Use Asset will be depreciated over the period of lease and the lease liability is reduced by accounting the monthly lease payments.

Basic earnings per share has been calculated by dividing profit for the year attributable to equity shareholders, by the weighted average number of equity shares outstanding during the year. Diluted earnings per share has been calculated by dividing profit for the year attributable to equity shareholders, by the weighted average number of equity shares outstanding during the year and also the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date. Dilutive potential equity shares that have been converted in to equity shares during the year are included in the calculation of diluted earnings per share from the beginning of the year to the date of conversion and from the date of conversion, the resulting equity shares are included in computing both basic and diluted earnings per share. Earnings per Share has been computed as under:

(i) Future cash outflows in respect of (a)(i) and a(ii) above is determinable only on receipt of judgments/decisions pending with various authorities/forums and/or final outcome of the matters. Accordingly, no provision in the accounts has been made as management is confident that these matters would be decided in the company's favour.

(ii) The aforesaid amount referred to in (a)(i) above is inclusive of interest and other penalties/levies.

Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. Nil (Previous year Rs. Nil).

52 Segment Reporting

The Company is primarily in the business of manufacturing and sales of textile products (i.e., Fabrics and Garments). The Chief Operating Decision Maker (CODM), the Chairman & Managing Director, performs a detailed review of the operating results, takes decisions about the allocation of resources based on the analysis of the various performance indicators of the Company as a whole. Therefore, there is only one operating segment in accordance with Ind AS 108 “Operating Segments” namely, “Textiles”.

53 The Company has exercised the option permitted under Section 115 BAA of the Income Tax Act, 1961 as promulgated by the Taxation Laws (Amendment) Ordinance, 2019. Section 115BAA states that domestic companies have the option to pay tax at a rate of 22% plus sc of 10% and cess of 4%. The Effective Tax rate being 25.17% from the FY 2020-21 (AY 2021-22) onwards if such domestic companies adhere to certain condition and do not avail any exemptions/incentives under different provisions of income tax like Claiming a set-off of any loss carried forward or depreciation from earlier years, if such losses were incurred in respect of the aforementioned deductions. Since the Company has carry forwards losses of previous years, hence the need for making any provision for Income Tax does not arise for F.Y. 202425.

54 During the year 2019-20, the Company had received a cash refund of Rs.30,83,919/- from the Central Excise Department consequent upon receiving a favorable judgement from the Appellate Tribunal. Subsequently, the Excise Assistant Commissioner (Refund) Central Excise - Belapur division had issued an order directing the Holding Company to refund the Cash amount and to receive equivalent CENVAT credit for future setoff. The Holding Company had filed an appeal against the said order with the Commissioner (Appeals). The Excise Commissioner passed an Order in favour of the Department against which the Holding Company has filed an appeal with the Appellate authorities. There is no further development in the matter. The Management of the Holding Company strongly believes that the final outcome of the Tribunal will be in it's favour.

55 Physical verification of inventory was conducted by the Internal Auditor (an external Chartered Accountant firm appointed by the company) alongwith a team member of the Statutory Auditors on a periodically basis. Each item was physically examined in the presence of the company’s team and any difference or variation was rectified on the spot. Only unresolved items are listed out and discussed separately with the Chief Executive Officer of the company. The report was presented before the Audit committee and also commended to the Board for noting.

56 a) During the year the company has valued the remaining slow moving/unsaleable inventory at the best realizable value and accordingly has written down the value of the retail division finished goods inventory by Rs.22.58 lakhs. Accordingly, the company has passed necessary entries in the books. b) The Company has made a provision for probable estimated credit loss of Rs.251.54 lakhs as required under Ind AS 109.

57 Credit loss is calculated on the basis of actual outstanding receivables based on the age wise analysis and also based on the past three year’s average. Accordingly a certain specified percentage of the amount arrived based on the three years average is computed post which some adjustments are made as per the Holding Company's estimates & judgements and provided in the books. As per the prevailing trend and past experience the computed amount of Rs.251.54 lakhs has been provided in the books during the current year.

58 Additional regulatory information not disclosed elsewhere in the financial information

(a) The Company has disclosed the contingent liabilities in its financial statements in Note 52. The Company does not expect the outcome of these proceedings to have a material impact on its financial position.

(b) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

(c) There has been no delay in transferring amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

(d) The Company did not hold any benami property during the year.

(e) The Company has not been declared as a wilful defaulter by any bank or financial Institution or other lender.

(f) The Company did not have any transactions with struck off companies during the year under Section 248 or 560 of the Companies Act, 2013.

(g) No loans/advances were given to promoters, directors, KMPs & other related parties that were payable on demand or without specifying any terms & conditions.

(h) Neither any charges were created on the assets of the company during the year with the Registrar of companies nor was satisfaction of any charge pending beyond the stipulated period.

(i) The Company did not deal in any manner whatsoever with crypto currency/virtual currency during the year.

(j) The Company has not advanced/loaned/invested funds to any other person(s) or entity(ies), including foreign entities (intermediaries) with the understanding (whether recorded in writing or otherwise) that the intermediary shall:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

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

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

(l) The Company neither declared nor paid any Dividend during the financial year.Hence, disclosure under provisions of Section 123 are not applicable.

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

(n) The Company has used borrowings from Banks and Financial Institutions for the specific purpose for which it was obtained.

(o) During the year, the Company does not have any borrowings against current assets (Book Debts & Inventories). Hence, Company is not required to furnish Quarterly returns or statements of current assets filed by the Company with Banks or Financial Institutions are in agreement with the books of accounts.

(p) The title deeds of all immovable properties (other than immovable properties where the Company is the lessee and the lease agreements are duly executed in favour of the Company) disclosed in the financial statements included in property, plant and equipment and capital work in process are held in the name of the Company as at the Balance Sheet date.

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

(r) 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.

(s) The Company has maintained its books of account using accounting software that includes the audit trail (edit log) feature, as mandated under Rule 3 of the Companies (Accounts) Rules, 2014 (as amended). The said feature has remained operational throughout the financial year for all relevant financial transactions recorded in the software. There have been no instances of the audit trail feature being disabled or tampered with during the year.

In respect of the software used for recording inventory transactions, the audit trail (edit log) functionality was under configuration during FY 2024-25 and has been successfully implemented and activated. The feature will remain active going forward in compliance with statutory requirements.

The Company maintains payroll records externally in Excel format. While this format does not have a system-generated audit trail, appropriate manual controls and documentation are in place to ensure the integrity and traceability of payroll data.

60 The Financial results have been presented in accordance with the Division II of Schedule III to the Companies Act, 2013. Certain Balances of assets and liabilities as at March 31, 2025 have been regrouped/reclassified, wherever necessary, to comply with the amended Division II of Schedule III. Such reclassifications did not have a material impact on the financial results.

61 Events after the reporting date

No other adjusting or significant non-adjusting events has occurred between the reporting date (31st March, 2025) and the report release date (19th May, 2025).

62 The previous period figures have been regrouped / reclassified, wherever necessary to conform to the current period presentation.

Signatures to Notes 1 to 62

The accompanying notes are an intergral part of the standalone financial statements.