5 RIGHT-OF-USE ASSETS AND LEASE LIABILITIES Company as a lessee

The Company has lease contracts for various items of building, land and plant & machinery (IT equipment) used in its operations. Leases of building generally have lease terms between 4 and 9 years and certain plant & machinery (IT equipment) have lease term of 5 years. Leasehold land pertains to upfront payments made to Maharashtra Industrial Development Corporation and hence have longer lease terms upto 99 years with no corresponding lease liabilities. The Company's obligations under its leases are secured by the lessor's title to the leased assets. There are several lease contracts that include extension and termination options and variable lease payments. The Company also has certain leases of machinery with lease terms of 12 months or less and leases of office equipment with low value. The Company applies the 'short-term lease' and 'lease of low-value assets' recognition exemptions for such leases.

(c) Terms / Rights attached to equity shares

The Company has only one class of equity shares having a par value of ? 2.0 per share (Previous Year : ? 2.0 per share). Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors, if any, is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of Interim Dividend, which is ratified subsequently.

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.

The Board of Directors at its meeting held on 25^th May, 2026, recommended dividend of ? 5/- (Rupee five only) (i.e. 250%) per Equity Share of face value of ? 2/- each fully paid up, for the Financial Year ended 31^st March, 2026, subject to approval of the members at ensuing Annual General Meeting.

In the previous year, the Board of Directors had recommended a final dividend of ? 4.50/- per share on face value of ? 2.0/- per share (i.e. 225%) for the FY 2024-25, which was approved by the shareholders at the 74^th Annual General Meeting of the Company.

As per records of the Company, including it's register of shareholders / members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.

Consequent to issue of Equity Shares by way of Employee Stock Options Plan of the Company, percentage of total shares held by the above shareholders has diluted since the total number of issued Equity Shares has increased from 7,85,72,885 to 7,86,11,936.

During the FY24-25, the Company had issued 9,80,000 Warrants convertible into 9,80,000 Equity Shares of ? 2 each to Mr. R. B. Rathi. The said Warrants are eligible for conversion into Equity Shares within a period of eighteen months from the date of Issue i.e. 13^th December, 2024. As on 31^st March, 2026, the said Warrants have not been converted into Equity Shares and hence are not reflected in the total number of shares held by Mr. R. B. Rathi in the table above. Refer note 17 (f) for more details.

(e) For a period of five years immediately preceding 31^st March, 2026

- aggregate number of shares allotted as fully paid up pursuant to contract without payment being received in cash - Nil

- aggregate number and class of shares allotted as fully paid up by way of bonus shares - Nil

- aggregate number of shares bought back - Nil

(g) The Board of Directors of the Company at its meeting held on 16^th October, 2024, considered and approved the proposal for increase in the Authorised Share Capital from ?15,00,00,000 divided into 7,50,00,000 equity shares of ? 2/- each to ? 20,00,00,000 divided into 10,00,00,000 equity shares of ? 2/- each ranking pari-passu with the existing equity shares of the Company with a consequent amendment to the Memorandum of Association. The same was approved by the Shareholders of the Company by way of resolution passed by Postal Ballot on 30^th November, 2024.

(h) On 29^th January, 2025, the Company had issued and allotted 74,76,635 fully paid-up equity shares of face value of ?2/- each at a price of ?1,070 per equity share, including a premium of ?1,068 per equity share, aggregating up to ? 800.0 Crores ("Issue") to qualified institutional investors in accordance with the provisions of SEBI ICDR Regulations. The Company has used the proceeds from the Issue for investment in Sudarshan Europe B.V. for part funding of the acquisition of global pigment business operations of the Heubach Group, including all associated costs in relation to the acquisition, repayment / pre-payment, in part or in full, of certain outstanding borrowings availed by the Company and for general corporate purposes in accordance with the Placement Document dated 28^th January, 2025. Out of the total proceeds, ? 799.2 Crores were utilised upto the period ended 30^th June, 2025 for the said objectives. The monitoring agency report for the period ended 30^th June, 2025 issued by CRISIL Ratings Limited stating that no deviation in such utilisation of funds was uploaded on the stock exchanges on 30^th July, 2025. Remaining unutilized proceeds of ? 0.8 Crores were utilised upto the period ended 30^th September, 2025 for the said objectives. The monitoring agency report for the period ended 30^th September, 2025 issued by CRISIL Ratings Limited stating that no deviation in such utilisation of funds was uploaded on the stock exchanges on 14^th November, 2025. Accordingly, the Company has fully utilized proceeds raised from qualified institutional investors as on 31^st March, 2026.

(i) On 13^th January, 2025, the Company has issued and allotted 18,69,000 fully paid-up equity shares of face value of ?2/- each at a price of ?1,043.33 per equity share, including a premium of ? 1,041.33 per equity share, aggregating up to ?195.0 Crores to the identified allottees / investors, not belonging to "Promoter and Promoter Group" of the Company by way of a preferential issue on private placement basis, for cash consideration (the "Preferential Allotment") in accordance with provisions of the Chapter V of the SEBI ICDR Regulations and as per applicable provisions of the Companies Act, 2013 and rules made thereunder. Consequently, equity share capital and other equity (securities premium) of the Company has increased by ? 0.4 Crores and ? 194.6 Crores respectively. Issue expenses of ? 0.8 Crores have been netted from other equity (securities premium).

(j) During the Financial Year 2025-26, employees exercised a total of 49,891 stock options under the Company's Employee Stock Option Plan (ESOP) at an exercise price of ?349.40 per share. Out of these, 39,051 equity shares were issued and allotted during the year, including allotments made on 29^th July, 2025, 9^th October 2025, and 17^th

December 2025. The balance 10,840 options exercised, for which application money has been received, are pending allotment as at the year end and are accordingly disclosed under the head "Share Application Money Pending Allotment" (Refer note 17(g)).

(k) Other disclosure

The Company being ultimate holding company, there are no shares held by any other holding, ultimate holding company and their subsidiaries.

There are no shares reserved for issue under options and contracts / commitments for the sale of shares / disinvestment, including the terms and amounts; except as disclosed in note 50 and note 17 (f).

There are no securities convertible into equity / preference shares issued along with the earliest date of conversion in descending order starting from the farthest such date.

months, to Mr. Rajesh Balkrishna Rathi, being a part of the promoter and promoter group of the Company, by way of a preferential issue through private placement offer. The same was subsequently approved by the Shareholders of the Company by way of resolution passed by Postal Ballot on 30^th November, 2024. The Fund Raising Committee of the Board of Directors of the Company at it's meeting held on 13^th December, 2024, approved the allotment of 9,80,000 warrants to Mr. Rajesh Balkrishna Rathi, as per the details set forth below:

Description of nature and purpose of each reserve

(a) Capital reserve

Capital reserve includes surplus on re-issue of shares made in the financial year 1996-97 amounting to ? 0.4 Lakhs.

(b) Securities premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

(c) General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. 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. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

(d) Effective portion of cash flow hedge

The cash flow hedging reserve represents the cumulative effective portion of gains or losses arising on changes in fair value of designated portion of hedging instruments entered into for cash flow hedges. Such gains or losses will be reclassified to Statement of Profit and Loss in the period in which the underlying hedged transaction occurs (refer note 49 and 51).

(e) Share options (ESOP) outstanding reserve

The share options-based payment reserve is used to recognise the grant date fair value of options issued to employees under employee stock option plan. (refer note 16(j) and 50).

The amounts recognised in this reserve are transferred to Securities Premium when Options are exercised by the employees or they expire unexercised.

(f) Money received against share warrants

The Fund Raising Committee of the Board of Directors of the Company at its meeting held on 31^st October, 2024, approved raising of funds not exceeding ?100.0 Crores by way of issuance of upto 9,80,000 warrants, each convertible into, or exchangeable for, one fully paid-up equity share of the Company of face value of ?2/- each ("Warrants") at a price of ?1,019.75 each payable in cash ("Warrants Issue Price"), which may be exercised in one or more tranches during the period commencing from the date of allotment of the Warrants until expiry of eighteen

*The warrant holder will be required to make further payments of ? 764.81 for each Warrant, which is equivalent to 75% of the Warrants Issue Price at the time of exercise of the right attached to Warrants to subscribe to equity share(s). As on 31^st March 2026, the said warrants have not been converted into equity shares.

(g) Share application pending allotment

The Company has established equity-settled share based payment plans for eligible employees of the Company. This pertains to application money received for employees pending allotment and issue of shares under share based payment scheme.

(h) Retained earnings

Retained earnings are the profits/(losses) that the Company has earned / incurred till date, less any transfers to general reserve, dividends or other distributions paid to shareholders. Retained earnings include re-measurement loss / (gain) on defined benefit plans, net of taxes that will not be reclassified to Statement of Profit and Loss.

The above balance also includes interest accrued but not due amounting to ? 0.8 Crore as at 31^st March, 2026 and ? 6.7 Crores as at 31^st March, 2025.

OTHER REGULATORY INFORMATION

The Company files monthly / quarterly statement for its current assets with banks. Further, pursuant to subsequent adjustment if any post closures of yearly books and statutory audit, the Company files the revised return with the updated amounts at the year end.

The charges or satisfaction on the assets of the Company are registered with Registrar of Companies within the statutory period. The Company does not have any charges or satisfaction which are yet to be registered with Registrar of Companies (ROC) beyond statutory period.

The Company has used the borrowings obtained from banks and financial institutions for the specific purpose for which they were taken during the year ended 31^st March, 2026 and 31^st March, 2025.

The Company has not been declared as a wilful defaulter by any bank or financial institution or government or any government authority during the current year and previous year.

F Pillar Two rules

The Organisation for Economic Co-operation and Development (OECD) has published the model rules for global minimum tax (Pillar Two model rules). As per the provisions of Pillar Two legislation, the Company's ultimate parent entity (UPE) has consolidated revenues exceeding the threshold prescribed under the OECD framework. Pillar Two legislation has been enacted, or substantively enacted, in certain jurisdictions where the Company operates. Based on the current assessment, the Company does not expect a material financial impact from the application of the Pillar Two rules. The evaluation of the potential exposure is based on the most recent country-by-country reporting, and financial statements for the constituent entities in the Company. In accordance with Amendments to Ind AS 12, the Company has applied temporary mandatory relief from accounting for deferred tax that arises from implementing Pillar Two legislation.

Risk Exposure

The gratuity scheme is a salary defined benefit plan that provides for lump sum payment made on exit either by way of retirement, death, disability or voluntary withdrawal. The benefits are defined on the basis of final salary and the period of service and paid as lump sum at exit. The plan design means the risk commonly affecting the liabilities and the financial results are expected to be:

(a) Interest rate risk: The defined benefit obligation calculated uses a discount rate based on government bonds, if bond yield fall, the defined benefit obligation will tend to increase.

(b) Salary inflation risk: Higher than expected increases in salary will increase the defined benefit obligation.

(c) Demographic risk: This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria.

Sensitivity analysis indicates the influence of a reasonable change in certain significant assumptions on the outcome of the present value of obligation and aids in understanding the uncertainty of reported amounts. Sensitivity analysis is done by varying one parameter at a time and studying its impact.

Sensitivity analysis for each significant actuarial assumptions namely Discount rate and Salary assumptions have been shown in the table above at the end of the reporting period, showing how the defined benefit obligation would have been affected by the changes.

The method used to calculate the liability in these scenarios is by keeping all the other parameters and the data same as in the base liability calculation except the parameters to be stressed.

There is no change in the method from the previous period and the points / percentage by which the assumptions are stressed are same to that in the previous year.

The assumptions for mortality and attrition do not have a significant impact on the liability, hence are not considered a significant actuarial assumption for the purpose of sensitivity analysis.

II Pension

The Company provides for Pension, a defined benefit retirement plan covering eligible employees. The Company accounts for liability of such future benefits based on an independent actuarial valuation on projected accrued credit method carried out for assessing the liability as on the reporting date.

Based on the recommendation of the Nomination and Remuneration Committee, the Board, at its meeting held on 7^th January 2026, approved discontinuation of Pension Policy providing for payment of pension benefits to eligible employees of the Company, with effect from 1^st February, 2026.

Sensitivity analysis indicates the influence of a reasonable change in certain significant assumptions on the outcome of the present value of obligation and aids in understanding the uncertainty of reported amounts. Sensitivity analysis is done by varying one parameter at a time and studying its impact.

Sensitivity analysis for each significant actuarial assumptions namely Discount rate and Salary assumptions have been shown in the table above at the end of the reporting period, showing how the defined benefit obligation would have been affected by changes.

The method used to calculate the liability in these scenarios is by keeping all the other parameters and the data same as in the base liability calculation except for the parameters to be stressed.

The assumption for mortality and attrition do not have a significant impact on the liability, hence are not considered a significant actuarial assumption for the purpose of sensitivity analysis.

III Leave Encashment / Compensated Absences / Sick Leave

The leave obligations cover the Company's liability for sick leave, privilege leave and casual leave.

The amount of the provision to be settled within next 12 months is presented as current, since the Company does not have an unconditional right to defer the settlement for any of these obligations. 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 table shows bifurcation of current and non-current provision for leave encashment.

The Company provides for accumulation of compensated absences by certain categories of its employees. These employees can carry forward a portion of unutilised compensated absences and utilise it in the future periods or receive cash in lieu thereof as per Company policy. The Company records an obligation for compensated absences in the period in which the employee renders the services that increases this entitlement. The measurement of such obligation is based on actuarial valuation as at the Balance Sheet date carried out by qualified actuary on projected unit credit method carried out for assessing the liability as on the reporting date.

i The Company's pending litigations comprise of claims against the Company pertaining to proceedings pending with Income Tax, Excise, Custom and other authorities. The Company has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed as contingent liabilities where applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a materially adverse effect on its financial statements.

ii It is not practicable for the Company to estimate the timing of cash outflows, if any, in respect of the above pending resolution of the respective proceedings as it is determinable only on receipt of judgments / decisions pending with various forums / authorities. The Company has assessed that it is only possible, but not probable, that outflow of economic resources will be required in this regard.

iii The Company does not expect any reimbursements in respect of the above contingent liabilities.

iv The Company has received demand orders from the Goods and Services Tax (GST) Department pertaining to FY 2021-22 during the year 2025-26, aggregating to ? 70.8 Crores. These orders are appealable, and the Company believes it has a strong case on all the matters contested by the GST Department. Accordingly, based on legal advice, wherever applicable, and management's assessment, no provision is considered necessary in respect of these demands, as the Company does not expect any material impact on its financial position, operations, or other activities.

v The Government of Maharashtra revised electricity duty payable on captive power generation (""CPP"") vide notification dated 13^th April, 2015 and accordingly MSEDCL issued a Circular no 214 dated 23^rd

April, 2015, the revised rates for CPP was revised to 120 paise per unit from 30 paise per unit. The rates for CPP increased by 4 times, which was very high, therefore the Captive Power Producers Association filed writ petition with Bombay High Court which has been admitted by H.C. vide case No. WP/4963/2015 and WP/906/2017. The High Court passed interim stay order, subsequently during the last hearing held on 24^th January, 2020, the bench passed the order to continue the interim stay granted previously. The Company has obtained an opinion from a subject-matter expert ('SME') on the Electricity Duty contingency. The matter is sub-judice with the Bombay High Court and the SME has opined that the Company has a good case of success in the proceedings.

vi During the year ended 31^st March, 2025, the Company applied under the amnesty scheme for certain eligible Excise duty / Service tax related matters pertaining to FY 2015-16 to FY 2017-18. An amount of ? 0.3 Crores, which had been disclosed as a contingent liability in previous years, was covered under this application. During the current year, the Company received approval under the scheme and, accordingly, settled the dues by making the required payment, thereby extinguishing the liability.

vii The Company has subsequently received favourable orders from the Commissioner of Income Tax (Appeals) in respect of cases pertaining to Assessment Years 2020-21, amounting to ? 2.1 Crores stating that AO shall rectify the order passed earlier.

Further during the year the company has also received the order is respect of cases pertaining to AY 202021 and 2021-22, amounting to ? 1.2 Crores. However, as at the reporting date, the statutory time limit for the tax authorities to file appeals before higher appellate forums has not yet expired. Accordingly, as a matter of prudence, the Company continues to disclose these amounts as contingent liabilities. Based on the current status of the cases and the legal advice obtained, management does not expect the outcome of these proceedings to have a materially adverse impact on the Company's financial position or results of operations.

(c) OTHER LITIGATIONS

There are several other cases which has been determined as remote or has been provided in the books by the Company and hence not been disclosed above.

(d) GUARANTEES EXCLUDING FINANCIAL GUARANTEES

The Company has given guarantees on behalf of Sudarshan Europe B.V., and RIECO Industries Limited for working capital and business expansion requirement of the subsidiary companies. The Company has issued letter of support on behalf of it's wholly own subsidiary RIECO Industries Limited. The management has considered the probability for outflow of the same to be remote. The Company has reviewed the financial position along with consideration of other factors of the entity to whom the guarantees are issued and has determined that the exposure of revocation of liability is remote. Hence these financial guarantees are not measured at fair value as per Ind AS 109 - Financial Instruments (Refer note 43). Other than this the Company has issued guarantees to Maharashtra Pollution Control Board, Maharashtra State Electricity Distribution Company Limited, Custom Authorities and other authorities amounting to ? 10.3 Crores (Previous Year ? 6.5 Crores).

46 OTHER STATUTORY INFORMATION

(a) There are no loans or advances in the nature of loans either repayable on demand or without specifying any terms or period of repayment granted to promoters, directors, KMPs and related parties (all of these to be identified as defined under Companies Act, 2013) either severally or jointly with any other person.

(b) The Company does not hold any Benami property and no proceedings have been initiated or pending against the Company for holding any Benami Property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.

(c) The Company has transaction balance with below-mentioned companies struck-off under section 248 of The Companies Act, 2013 or section 560 of The Companies Act, 1956:

49 RISK MANAGEMENT AND CAPITAL MANAGEMENT

A Financial instruments risk management objectives and policies

The Company's principal financial liabilities other than derivatives, comprise of borrowings, lease liabilities, other financial liabilities, trade and other payables. The main purpose of these financial liabilities is to finance the Company's operations and to support its operations. The Company's principal financial assets other than derivatives include investments, trade and other receivables, deposits, loans, cash and cash equivalents and other financial assets that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company's senior management oversees the management of these risks. The Company's senior management is supported by an Enterprise Risk Management (ERM) team that advises on financial risks and the appropriate financial risk governance framework for the Company. The ERM team provides assurance to the Company's senior management that the Company's financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company's policies and risk objectives. The ERM team process seeks to provide greater confidence to the decision maker and thus enhance achievement of objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

(a) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include borrowings, deposits, investments, trade and other receivable, trade and other payables and derivative financial instruments. The sensitivity analysis in the following sections relate to the position as at 31^st March, 2026 and 31^st March, 2025.

The Company uses derivatives (forward contract, interest rate swap and cross currency interest rate swap) or nonderivative or a combination of both to hedge its exposure of forex / interest rate related risk. These instruments are either used to lock in a lower purchase price or / and a higher sales prices / fixed interest rate. The gain or loss on hedging instrument are aligned and effectively an offset compared with hedged item.

The economic relationship between hedged item and hedged instrument is established to ensure that both are moving in the opposite direction because of the same hedged risk.

The credit risk associated with the hedge relationship is negligible due to the highly rated counterparties.

The Company's hedging policy only allows for effective hedge relationships. Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness assessments to ensure that an economic relationship exists between hedged item and hedging instrument. The Company enters into hedge relationships where the critical terms of the hedging instrument match exactly with the terms of the hedged item, and so a qualitative assessment of effectiveness is performed. If the critical terms of the hedged item do not match exactly with the critical terms of the hedging instrument, the Company uses the quantitative analysis to assess effectiveness.

Ineffectiveness is recognised on a cash flow hedge where the cumulative change in the designated component value of the hedging instrument exceeds, on an absolute basis, the change in value of the hedged item that attributes to the hedged risk. This may arise if there is any change in the timing of the underlying hedged item or if the critical terms of the hedging instrument and the hedged item do not match exactly.

In addition to the historical pattern of credit loss, the Company has also considered the likelihood of increased credit risk considering emerging situations due to the current geopolitical scenarios. This assessment is based on the likelihood of the recoveries from the customers in the present situation. The Company closely monitors its customers who are going through financial stress and assesses actions such as change in payment terms, recognition of revenue on collection basis etc., depending on severity of each case. Basis this assessment, the allowance for doubtful trade receivables is considered adequate.

In addition, financial instruments that are subject to concentration of credit risk including loans, cash and cash equivalents, other balances with banks and other financial assets. None of the financial instruments of the Company result in material concentration of credit risk. Credit risk on cash and cash equivalents is limited as the Company generally invest in deposits with banks and financial institutions with high credit ratings assigned by international and domestic credit rating agencies.

There has been realisation of money by exercise of option during the year ended 31^st March 2026 of ? 1.7 Crores (31^st March 2025: ? Nil) (Refer note 16(j)).

The options outstanding at 31^st March, 2026 have an exercise price of ? 349.4 (31^st March, 2025: ? 349.4) and a weighted average remaining contractual life of 4.2 years (31^st March, 2025: 5.2 years).

Weighted average share price at the date of the exercise of share options exercised in 2025-26 is ? 1,146.0 and no shares were exercised during previous year 2024-25 hence weighted average share price is not disclosed.

Weighted average fair value of share options granted during the year is not disclosed as no share options were granted during the current and previous financial year.

51 HEDGING ACTIVITIES Cash flow hedges

The Company enters into derivative instruments which comprise of interest rate swaps, cross currency swaps and also designates its foreign currency borrowings against highly probable forecasted export sales and derivative contracts-IRS for hedge accounting to manage its foreign currency exposure.

These instruments are measured at fair values at each reporting period resulting in derivative financial assets and derivative financial liabilities. The gain / (loss) on maturity / termination of such derivative instruments is recorded in the Statement of Profit and Loss along with the relevant hedged item.

The cash flow hedges of the highly probable forecasted export sales during the year ended 31^st March, 2026 were assessed to be highly effective and a net unrealised (loss) / gain of ? 6.4 Crores (31^st March, 2025: ? 12.4 Crores) is included in OCI. The amounts retained in OCI at 31^st March, 2026 are expected to be realised in the Statement of Profit and Loss till the year ended 31^st March, 2028.

The following are the details of outstanding derivative and non derivative instruments (foreign currency loans) entered into by the Company which have been designated as cash flow hedges:

Derivatives not designated as hedging instruments:

The Company has used foreign exchange forward contracts to manage its import payments, loan repayments and realisation from export customers. These foreign exchange forward contracts are not designated as cash flow hedges and are entered into for periods consistent with foreign currency exposure of the underlying transactions i.e. the payments against import purchases, loan repayments and realisation from export customers.

a) The Board of Directors of Sudarshan Europe B.V ("SEBV") (wholly owned subsidiary of Sudarshan Chemical Industries Limited) at its meeting held on 8^th October, 2024 provided its in-principle approval for the acquisition of global pigment business operations of the Heubach Group of Germany through an asset and share deal, subject to completion of customary conditions and receipt of requisite regulatory approvals. Pursuant to this, SEBV has entered into a definitive agreement in relation to the said proposed acquisition on 11^th October 2024. The said acquisition was completed on 3^rd March, 2025 (""Closing Date"") by SEBV for a preliminary purchase consideration of € 151.9 million (approx. ? 1,389.9 Crores) which was subsequently finalised at € 139.6 million (approx. ? 1,277.0 Crores) during the 'measurement period' as per Ind AS 103 : Business Combinations in line with the Purchase and Transfer Agreement. The acquisition was financed through a combination of external funds raised by the Company and borrowings availed by SEBV. Transaction and other incidental costs with respect to the aforesaid acquisition incurred up to 31^st March, 2025 have been disclosed as ""Exceptional items income / (expense)"".

b) On 21 November 2025, the Central Government issued four separate notifications in the Official Gazette announcing implementation of four Labour Codes, viz., the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the Occupational Safety, Health and Working Conditions Code, 2020. These four codes replace and consolidate 29 existing labour laws. Following the implementation of the four labour codes, the Central Government has pre-published the draft rules on 31 December 2025 under the respective Labour Codes, for public comment and the final rules are expected to be notified in due course. To ensure smooth implementation, the Ministry of Labour and Employment has also issued the Frequently Asked Questions (FAQs) on the four codes.

The four codes prescribe an inclusive definition of the term 'wages', which among other matters is relevant for determination of post-employment benefits including gratuity to all employees. In accordance with the definition, certain specified items forming part of remuneration are not included in the wages and these excluded items cannot exceed 50% of total remuneration. If there is an excess, then it is presumed that excess amount also forms part of wages. The four codes also introduce changes related to leave entitlement and encashment for workers. Going forward, workers' leave balance in excess of 30 days will be encashed at the end of each calendar year and workers will have a right to demand encashment for entire accumulated leave.

The Company has assessed and disclosed the incremental impact of these changes on the basis of the best information available till approval of the financial statements for issue, consistent with the guidance provided by the Institute of Chartered Accountants of India. The Company has determined that these changes result in an increase in gratuity obligation (? 21.1 Crores). The changes to gratuity obligation resulting from the labour codes are accounted as plan amendments and resulting past service cost are recognised as an expense immediately in the Statement of Profit and Loss (Refer note 40). Considering the materiality and regulatory-driven, non-recurring nature of this change, the Company has disclosed such incremental impact under "Exceptional items (expense) / income" in the Standalone Statement of Profit and Loss for the year ended 31^st March 2026. Considering that it is emerging topic and the finalisation of Central/ State Rules is still pending, the Company will continue monitoring changes and provide appropriate accounting effect as required based on future developments.

*Excludes investments in subsidiaries accounted as per cost model in accordance with Ind AS 27- 'Separate Financial Statements'.

Note- The carrying amounts of financial assets and financial liabilities carried at amortised cost approximate their fair values.

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

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following method and assumptions were used to estimate the fair value:

(i) Long-term fixed-rate and variable-rate receivables / borrowings are evaluated by the Company based on parameters such as interest rates, specific country risk factors, individual creditworthiness of the customer and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

(ii) The fair value of unquoted instruments, loans from banks, lease liabilities and other current financial liabilities as well as other non-current financial liabilities is estimated by discounting future cash flows using rates currently available for debt on similar terms, credit risk and remaining maturities.

(iii) The Company enters into derivative financial instruments with financial institutions and banks with investment grade credit ratings. Foreign exchange Forward Contracts and Interest Rate Swap are valued using valuation techniques, which employ the use of market observable inputs. The most frequently applied valuation techniques include forward pricing models, using present value calculations. The model incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates, yield curves of the respective currencies, currency basis spreads between the respective currencies, interest rate curves and forward rate curves of the underlying commodity.

(iv) The fair values of the Company's interest-bearing borrowings and loans are determined by using Discounted Cash Flow method using discount rate that reflects the issuer's borrowing rate as at the end of the reporting period. The own non-performance risk was assessed to be insignificant.

54 FAIR VALUE HIERARCHY

The following table provides the fair value measurement hierarchy of the Company's assets and liabilities

Quoted prices in an active market (Level 1): This level of hierarchy includes financial assets that are measured by reference to quoted prices (unadjusted) in active markets for identical assets or liabilities. This category consists of mutual fund investments.

Valuation techniques with observable inputs (Level 2): This level of hierarchy includes financial assets and liabilities, measured using inputs other than quoted prices included within Level 1 that are observable for the asset or liability,

either directly (i.e.; as prices) or indirectly (i.e.; derived from prices). This level of hierarchy include Company's over-the- counter (OTC) derivative contracts.

Valuation techniques with significant unobservable inputs (Level 3): This level of hierarchy includes financial assets and liabilities measured using inputs that are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part, using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data.

The following table presents the fair value measurement hierarchy of financial assets and liabilities measured at fair value on a recurring basis as at 31^st March, 2026 and 31^st March, 2025.

The table shows the valuation techniques used in measuring Level 2 and Level 3 fair values for financial instruments measured at fair value in the balance sheet, as well as the significant unobservable inputs used.

Valuation technique used to determine fair value of fair value measurements categorised within Level 2 and Level 3 of the fair value hierarchy are shown below:

There have been no transfers among Level 1, Level 2 and Level 3 during the year.

In determining fair value measurement, the impact of potential climate-related matters, including legislation, which may affect the fair value measurement of assets and liabilities in the financial statements has been considered. The Company has assessed whether its properties are exposed to physical risks, such as flooding and increasing wildfires, but believes that this is currently not the case. However, the Company believes it is, to some extent, impacted by transition risks, and, more specifically, increasing requirements for energy efficiency of buildings due to climate-related legislation and regulations as well as tenants' increasing demands for low-emission buildings. The Company, therefore, takes into account necessary upgrades required to ensure future compliance with those requirements when measuring the fair value of investment properties (if any).

55 The Standalone Financial Statements are presented in I and all values are rounded to the nearest Crores (? 00,00,000), except Where otherwise indicated.

Until 31^st March, 2025, the Company's Standalone Ind AS Financial Statements were presented in Indian Rupees (? 00,000) with values rounded off to the nearest lakhs, except Where otherwise indicated.

Certain notes and disclosures in the Standalone Ind AS Financial Statements have been presented as zero ("0.0") where the absolute amount is below the revised rounding off threshold adopted by the Company.

56 EVENTS AFTER THE REPORTING YEAR ENDED 31^st MARCH, 2026

The board of directors have proposed dividend after the balance sheet date which are subject to approval by the shareholders at the annual general meeting. Refer note 16 (C) and note 18 for details.

57 Additional regulatory information/disclosures as required by General Instructions to Division II of Schedule III to the Companies Act, 2013 are furnished to the extent applicable to the Company.

58 MCA has amended Rule 3 of the Companies (Accounts) Rules, 2014 (the "Accounts Rules") relating to the mode of keeping books of account and other books and papers in electronic mode through an amendment on 5^th August, 2022. In compliance with the requirements of the amendment, the books of accounts and other relevant books and records are accessible in India at all times. Further, backup of books of account maintained in electronic form is kept in servers physically located in India on a daily basis.

59 The Company has used accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software, except that audit trail feature is not enabled for changes, if any, made using certain administrative access rights to the SAP Hana software. Further, no instance of audit trail feature being tampered with was noted in respect of such accounting software where the audit trail has been enabled. Additionally, the audit trail of prior years has been preserved by the Company as per the statutory requirements for record retention to the extent it was enabled and recorded in the respective years.

60 The management has evaluated the likely impact of prevailing uncertainties relating to imposition or enhancement of reciprocal tariffs and believes that there are no material impacts on the financial statements of the Company for the year ended March 31, 2026. However, the management will continue to monitor the situation from the perspective of potential impact on the operations of the Company.

61 Standards notified but not yet effective

The new and amended standards that are notified by the Ministry of Corporate Affairs (MCA), but not yet effective, up to the date of issuance of the Company's financial statements are disclosed below. The Company will adopt these new and amended standards, when they become effective.

(a) Amendments to Ind AS 1 - Classification of Liabilities as Current or Non-current and Non-current Liabilities with Covenants and Ind AS 10 Events after the Reporting Period

Ind AS 10 has been amended to remove the previous treatment under which a lender's post reporting date waiver— granted before the financial statements were approved for issue - of a breach of a material covenant in a long term loan arrangement that occurred on or before the end of the reporting period, resulting in the liability becoming payable on demand at the reporting date, was regarded as an adjusting event.

For annual reporting periods beginning on or after 1^st April 2026, any breach of a covenant—whether material or immaterial—occurring on or before the reporting date will, in accordance with Ind AS 1, require the related liability to be classified as current, unless the lender has granted a waiver of the breach on or before the reporting date and has agreed not to demand repayment for at least 12 months after the reporting date as a consequence of the breach. Such a waiver shall be treated as an adjusting event.

The amendments are effective for annual reporting periods beginning on or after 1^st April 2026 retrospectively in accordance with Ind AS 8.