2.15 Provisions

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

The amount recognised as a provision is the best
estimate of the consideration required to settle the
present obligation at the end of the reporting period,
taking into account the risks and uncertainties
surrounding the obligation. When a provision is
measured using the cash flows estimated to settle the
present obligation, its carrying amount is the present
value of those cash flows (when the effect of the time
value of money is material).

When some or all of the economic benefits required to
settle a provision are expected to be recovered from a
third party, a receivable is recognised as an asset if it is
virtually certain that reimbursement will be received and
the amount of the receivable can be measured reliably.

Onerous contracts

If the Company has a contract that is onerous, the
present obligation under the contract is recognised and
measured as a provision. However, before a separate
provision for an onerous contract is established, the
Company recognises any impairment loss that has
occurred on assets dedicated to that contract.

An onerous contract is a contract under which the
unavoidable costs (i.e., the costs that the Company
cannot avoid because it has the contract) of meeting
the obligations under the contract exceed the
economic benefits expected to be received under it.
The unavoidable costs under a contract reflect the
least net cost of exiting from the contract, which is the
lower of the cost of fulfilling it and any compensation
or penalties arising from failure to fulfil it

2.16 Cash and cash equivalents

Cash and cash equivalent in the balance sheet
comprise cash at banks and on hand and short-term
deposits with an original maturity of three months
or less, which are subject to an insignificant risk of
changes in value.

For the purpose of the statement of cash flows, cash
and cash equivalents consist of cash and short-term
deposits, as defined above, net of outstanding bank
overdrafts as they are considered an integral part of
the Company’s cash management.

2.17 Employee Benefits
Defined Contribution plans

For certain employees of the Company, employee
benefit in the form of Provident fund, Employees State
Insurance Contribution and Labour Welfare fund are
defined contribution plans. The Company has no
obligation, other than the contribution payable to the
respective fund. The Company recognizes contribution
payable to the provident fund scheme as an expense,
when an employee renders the related service. If
the contribution payable to the scheme for service
received before the balance sheet date exceeds the
contribution already paid, the deficit payable to the
scheme is recognized as a liability after deducting
the contribution already paid. If the contribution

already paid exceeds the contribution due for services
received before the balance sheet date, then excess
is recognized as an asset to the extent that the pre¬
payment will lead to, for example, a reduction in future
payment or a cash refund.

Defined benefit plans

The Company provides for retirement benefit in the
form of gratuity. The Company’s liability towards
this benefit is determined on the basis of actuarial
valuation using Projected Unit Credit Method at the
date of balance sheet.

In respect of certain employees, provident fund
contributions are made to a trust administered by the
Company.

Periodic contributions to the Fund are charged to the
Statement of profit and loss. The Company has an
obligation to make good the shortfall, if any, between
the return from the investment of the trust and interest
rate notified by the Government of India. Such shortfall
is recognized in the Statement of profit and loss. The
Company’s liability is determined on the basis of an
actuarial valuation using the projected unit credit
method.

Remeasurement, comprising of actuarial gains and
losses, the effect of the asset ceiling, excluding
amounts included in net interest on the net defined
benefit liability and the return on plan assets (excluding
amounts included in net interest on the net defined
benefit liability), are recognised immediately in the
balance sheet with a corresponding debit or credit to
retained earnings through OCI in the period in which
they occur. Remeasurement is not reclassified to profit
or loss in subsequent periods.

Past service costs are recognised in profit or loss on
the earlier of:

• The date of the plan amendment or curtailment and

• The date that the Company recognises related
restructuring costs

Net interest is calculated by applying the discount
rate to the net defined benefit liability or asset. The
Company recognises the following changes in the net
defined benefit obligation as an expense in statement
of profit and loss:

• Service costs comprising current service
costs, past-service costs, gains and losses on
curtailments and non-routine settlements; and

• Net interest expense or income

Compensated absences

Accumulated leave, which is expected to be utilized
within the next 12 months, is treated as short-term
employee benefit and this is shown under current
provision in the Balance Sheet. The Company
measures the expected cost of such absences as the
additional amount that it expects to pay as a result of
the unused entitlement that has accumulated at the
reporting date.

The Company treats accumulated leave expected to be
carried forward beyond twelve months, as long-term
employee benefit for measurement purposes and this
is shown under long term provisions in the Balance
Sheet. Such long-term compensated absences are
provided for based on the actuarial valuation using the
projected unit credit method at the year-end. Actuarial
gains/losses are immediately taken to the Statement
of Profit and Loss and are not deferred. The Company
presents the leave as a current liability in the balance
sheet, to the extent it does not have an unconditional
right to defer its settlement for 12 months after
the reporting date. Where the Company has the
unconditional legal and contractual right to defer the
settlement for a period beyond 12 months, the same is
presented as non-current liability.

2.18 Research and Development

Research expenditure, including overheads, on
research and development, is charged as an expense
in the year in which incurred.

2.19 Employee Share-Based Payments

Equity-settled Transactions Equity-settled share-based
payments to employees are measured by reference to
the fair value of the equity instruments at the grant date
using Black-Scholes Model and Binomial Model. The fair
value, determined at the grant date of the equity settled
share-based payments, is charged to Standalone
Statement of Profit and Loss or recognised as
investments in subsidiary, if ESOP granted to employees

of subsidiary Company on a systematic basis over the
vesting period of the option, based on the Company’s
estimate of equity instruments that will eventually vest,
with a corresponding increase in other equity
In case of forfeiture/lapse stock option, which is not
vested, amortised portion is reversed by credit to
employee compensation expense. In a situation where
the stock option expires unexercised, the related balance
standing to the credit of the Employee Stock Options
Outstanding Account is transferred within other equity.
Cash-settled Transactions The cost of cash-settled
transactions is measured initially at fair value at the grant
date using a Black-Scholes Merton Formula. This fair
value is expensed over the period until the vesting date
with recognition of a corresponding liability. The liability
is re-measured to fair value at each reporting date up to,
and including the settlement date, with changes in fair
value recognised in employee benefits expense.

2.20 Treasury Shares

The Company has created an Employee Benefit
Trust (EBT) for providing share-based payment to its
employees. The Company uses EBT as a vehicle for
distributing shares to employees under the Employee
Stock Option Scheme. The EBT purchase shares of
the Company from the market, for giving shares to
employees. The Company treats EBT as its extension
and shares held by EBT are treated as treasury shares.
Own equity instruments that are re-acquired (treasury
shares) are recognised at cost and deducted from other
equity. No gain or loss is recognised in the Standalone
statement of profit and loss on the purchase, sale,
issue or cancellation of the Company’s own equity
instruments. Share options whenever exercised, would
be settled from such treasury shares.

2.21 Foreign currencies

The Company’s financial statements are presented in
INR, which is also the Company’s functional currency.
Transactions in foreign currencies are initially recorded
by the Company at INR spot rate at the date, the
transaction first qualifies for recognition. Monetary
assets and liabilities denominated in foreign currencies
are translated at the functional currency spot rates of
exchange at the reporting date.

Exchange differences arising on settlement or
translation of monetary items are recognised in profit
or loss.

Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated
using the exchange rates at the dates of the initial
transactions.

2.22 Financial instruments

A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.

Financial assets

Initial recognition and measurement

All financial assets are recognised initially at fair value
plus, in the case of financial assets not recorded at
fair value through profit or loss, transaction costs
that are attributable to the acquisition of the financial
asset.

Subsequent measurement

For purposes of subsequent measurement, financial
assets are classified in four categories:

• Financial Assets at amortised cost

• Financial Assets at fair value through other
comprehensive income (FVTOCI)

• Financial Assets including derivatives and equity
instruments at fair value through profit or loss
(FVTPL)

• Equity instruments measured at fair value
through other comprehensive income (FVTOCI)

Debt instruments at amortised cost

A 'debt instrument’ is measured at the amortised cost
if both the following conditions are met:

a) The asset is held within a business model
whose objective is to hold assets for collecting
contractual cash flows, and

b) Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on the
principal amount outstanding.

After initial measurement, such financial assets are
subsequently measured at amortised cost using the
effective interest rate (EIR) method. Amortised cost
is calculated by taking into account any discount or
premium on acquisition and fees or costs that are an
integral part of the EIR. The EIR amortisation is included
in other income in the profit or loss. The losses arising
from impairment are recognised in the profit or loss.
This category generally applies to trade and other
receivables, loans and other financial assets.

Equity investments

All equity investments in scope of Ind AS 109 are
measured at fair value. For all equity instruments, the
Company may make an irrevocable election to present
in other comprehensive income subsequent changes
in the fair value all fair value changes on the instrument,
excluding dividends, are recognized in the OCI. There
is no recycling of the amounts from OCI to P&L, even
on sale of investment. However, the Company may
transfer the cumulative gain or loss within equity. The
Company has made such election on an instrument-
by-instrument basis. The classification is made on
initial recognition and is irrevocable.

Derecognition

A financial asset (or, where applicable, a part of a
financial asset or part of a company of similar financial
assets) is primarily derecognised when:

• The rights to receive cash flows from the asset
have expired or

• The Company has transferred its rights to receive
cash flows from the asset or has assumed an
obligation to pay the received cash flows in full
without material delay to a third party under a
'pass-through' arrangement and either (a) the
Company has transferred substantially all the
risks and rewards of the asset, or (b) the Company
has neither transferred nor retained substantially
all the risks and rewards of the asset, but has
transferred control of the asset.

When the Company has transferred its rights to
receive cash flows from an asset or has entered into
a pass-through arrangement, it evaluates if and to
what extent it has retained the risks and rewards of

ownership. When it has neither transferred nor retained
substantially all of the risks and rewards of the asset,
nor transferred control of the asset, the Company
continues to recognise the transferred asset to the
extent of the Company's continuing involvement. In
that case, the Company also recognises an associated
liability. The transferred asset and the associated
liability are measured on a basis that reflects the rights
and obligations that the Company has retained.
Continuing involvement that takes the form of a
guarantee over the transferred asset is measured at
the lower of the original carrying amount of the asset
and the maximum amount of consideration that the
Company could be required to repay.

Impairment of financial assets

In accordance with Ind AS 109, the Company applies
expected credit loss (ECL) model for measurement
and recognition of impairment loss on the following
financial assets and credit risk exposure:

a) Financial assets that are debt instruments, and
are measured at amortised cost e.g., loans, debt
securities, deposits, trade receivables and bank
balance

b) Financial assets that are equity instruments and
are measured as at FVTOCI

c) Lease receivables under Ind AS 116

d) Trade receivables or any contractual right to
receive cash or another financial asset that result
from transactions that are within the scope of Ind
AS 115

The Company follows 'simplified approach’ for
recognition of impairment loss allowance on:

• Trade receivables

• All lease receivables resulting from transactions
within the scope of Ind AS 116

The application of simplified approach does not
require the Company to track changes in credit risk.
Rather, it recognises impairment loss allowance based
on lifetime ECLs at each reporting date, right from its
initial recognition.

For recognition of impairment loss on other financial
assets and risk exposure, the company determines
that whether there has been a significant increase in

the credit risk since initial recognition. If credit risk has
not increased significantly, 12-month ECL is used to
provide for impairment loss. However, if credit risk
has increased significantly, lifetime ECL is used. If, in
a subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition, then
the entity reverts to recognising impairment loss
allowance based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting
from all possible default events over the expected
life of a financial instrument. The 12-month ECL is a
portion of the lifetime ECL which results from default
events that are possible within 12 months after the
reporting date.

ECL is the difference between all contractual cash
flows that are due to the company in accordance
with the contract and all the cash flows that the entity
expects to receive (i.e., all cash shortfalls), discounted
at the original EIR. When estimating the cash flows, an
entity is required to consider:

• All contractual terms of the financial instrument
(including prepayment, extension, call and similar
options) over the expected life of the financial
instrument. However, in rare cases when the
expected life of the financial instrument cannot
be estimated reliably, then the entity is required
to use the remaining contractual term of the
financial instrument

• Cash flows from the sale of collateral held or
other credit enhancements that are integral to the
contractual terms

As a practical expedient, the Company uses a provision
matrix to determine impairment loss allowance on
portfolio of its trade receivables. The provision matrix
is based on its historically observed default rates
over the expected life of the trade receivables and
is adjusted for forward-looking estimates. At every
reporting date, the historical observed default rates are
updated and changes in the forward-looking estimates
are analysed.

ECL impairment loss allowance (or reversal)
recognized during the period is recognized as income/
expense in the statement of profit and loss (P&L). This

amount is reflected under the head 'other expenses'
in the P&L. The balance sheet presentation for various
financial instruments is described below:

• Financial assets measured as at amortised
cost, contractual revenue receivables and lease
receivables: ECL is presented as an allowance,
i.e., as an integral part of the measurement of
those assets in the balance sheet. The allowance
reduces the net carrying amount. Until the asset
meets write-off criteria, the Company does not
reduce impairment allowance from the gross
carrying amount.

• Loan commitments and financial guarantee
contracts: ECL is presented as a provision in the
balance sheet, i.e. as a liability.

• Equity instruments measured at FVTOCI: Since
financial assets are already reflected at fair value,
impairment allowance is not further reduced
from its value. Rather, ECL amount is presented
as 'accumulated impairment amount' in the OCI.

For assessing increase in credit risk and impairment
loss, the Company combines financial instruments on
the basis of shared credit risk characteristics with the
objective of facilitating an analysis that is designed
to enable significant increases in credit risk to be
identified on a timely basis.

The Company does not have any purchased or
originated credit-impaired (POCI) financial assets,
i.e., financial assets which are credit impaired on
purchase/ origination.

Financial liabilitiesInitial recognition and measurement

Financial liabilities are classified, at initial recognition,
as financial liabilities at fair value through profit or
loss, loans and borrowings, payables, or as derivatives
designated as hedging instruments in an effective
hedge, as appropriate.

All financial liabilities are recognised initially at fair
value and, in the case of loans and borrowings and
payables, net of directly attributable transaction
costs.

The Company’s financial liabilities include trade
and other payables, loans and borrowings including

bank overdrafts, financial guarantee contracts and
derivative financial instruments.

Subsequent measurement

The measurement of financial liabilities depends on
their classification, as described below:

Financial liabilities at fair value through profit or loss

Gains or losses on liabilities held for trading are
recognised in the profit or loss. The Company has
not designated any financial liability as at fair value
through profit and loss.

Loans and borrowings

This is the category most relevant to the Company. After
initial recognition, interest-bearing loans and borrowings
are subsequently measured at amortised cost using the
EIR method. Gains and losses are recognised in profit
or loss when the liabilities are derecognised as well as
through the EIR amortisation process.

Amortised cost is calculated by taking into account
any discount or premium on acquisition and fees
or costs that are an integral part of the EIR. The EIR
amortisation is included as finance costs in the
statement of profit and loss.

Derecognition

A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or
expires. When an existing financial liability is replaced
by another from the same lender on substantially
different terms, or the terms of an existing liability
are substantially modified, such an exchange or
modification is treated as the derecognition of the
original liability and the recognition of a new liability.
The difference in the respective carrying amounts is
recognised in the statement of profit or loss.

Offsetting of financial instruments

Financial assets and financial liabilities are offset
and the net amount is reported in the balance sheet
if there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realise the assets and settle the
liabilities simultaneously.

Derivative financial instruments:

The Company uses derivative financial instruments,
such as forward currency contracts, interest rate
swaps to manage its foreign currency risks and
interest rate risks respectively.

These derivative instruments are designated as cash
flow, fair value or net investment hedges and are
entered into for period consistent with currency. Such
derivative financial instruments are initially recognised
at fair value on the date on which a derivative contract
is entered into and are subsequently re-measured at
fair value. Derivatives are carried as financial assets
when the fair value is positive and as financial liabilities
when the fair value is negative. Any gains or losses
arising from changes in the fair value of derivatives are
recognised in the Statement of profit and loss except
for the effective portion of cash flow hedges, which is
recognised in OCI and later reclassified to profit or loss
when the hedge item affects profit or loss.

For the purpose of hedge accounting, hedges are
classified as:

- Cash flow hedges when hedging the exposure to
variability in cash flows that is either attributable
to a particular risk associated with a recognised
asset or liability or a highly probable forecast
transaction or the foreign currency risk in an
unrecognised firm commitment
At the inception of a hedge relationship, the Company
formally designates and documents the hedge
relationship to which the Company wishes to apply hedge
accounting and the risk management objective and
strategy for undertaking the hedge. The documentation
includes the Company’s risk management objective and
strategy for undertaking hedge, the hedging/ economic
relationship, the hedged item or transaction, the nature
of the risk being hedged, hedge ratio and how the entity
will assess the effectiveness of changes in the hedging
instrument’s fair value in offsetting the exposure to
changes in the hedged item’s fair value or cash flows
attributable to the hedged risk. Such hedges are
expected to be highly effective in achieving offsetting
changes in fair value or cash flows and are assessed on
an ongoing basis to determine that they actually have
been highly effective throughout the financial reporting
periods for which they were designated.

Cash flow hedges

The effective portion of the gain or loss on the hedging
instrument is recognised in OCI in the cash flow hedge
reserve, while any ineffective portion is recognised
immediately in the statement of profit and loss.

The Company uses forward currency contracts
as hedges of its exposure to foreign currency risk
in forecast transactions and firm commitments.
The ineffective portion relating to foreign currency
contracts is recognised in finance costs.

Amounts recognised as OCI are transferred to profit or
loss when the hedged transaction affects profit or loss,
such as when the hedged financial income or financial
expense is recognised or when a forecast sale occurs.
If the hedging instrument expires or is sold, terminated
or exercised without replacement or rollover (as part of
the hedging strategy), or if its designation as a hedge
is revoked, or when the hedge no longer meets the
criteria for hedge accounting, any cumulative gain or
loss previously recognised in OCI remains separately
in equity until the forecast transaction occurs or the
foreign currency firm commitment is met..

2.23 Investment in Subsidiary

The Company’s investments in its subsidiaries are
carried at cost.

2.24 Earnings Per Share:

Basic Earnings per share (EPS) amounts are calculated
by dividing the profit for the year attributable to equity
holders by the weighted average number of equity
shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the
profit attributable to equity holders adjusted for the
effects of potential equity shares by the weighted
average number of equity shares outstanding during
the year plus the weighted average number of equity
shares that would be issued on conversion of all the
dilutive potential equity shares into equity shares.

2.25 Cash dividend and non-cash distribution to equity
holders

The Company recognises a liability to make cash or
non-cash distributions to equity holders when the

distribution is authorised and the distribution is no
longer at the discretion of the Company. As per the
corporate laws, a distribution is authorised when it
is approved by the shareholders. A corresponding
amount is recognised directly in equity.

Non-cash distributions are measured at the fair value
of the assets to be distributed with fair value re¬
measurement recognised directly in equity.

Upon distribution of non-cash assets, any difference
between the carrying amount of the liability and the
carrying amount of the assets distributed is recognised
in the statement of profit and loss.

2.26 Contingent liabilities

A contingent liability is a possible obligation that arises
from past events whose existence will be confirmed
by the occurrence or non-occurrence of one or more
uncertain future events beyond the control of the
company or a present obligation that is not recognized
because it is not probable that an outflow of resources
will be required to settle the obligation. A contingent
liability also arises in extremely rare cases where
there is a liability that cannot be recognized because
it cannot be measured reliably. The company does
not recognize a contingent liability but discloses its
existence in the financial statements.

2B. SIGNIFICANT ACCOUNTING JUDGEMENTS,
ESTIMATES AND ASSUMPTIONS

The preparation of the Company’s separate
financial statements requires management to make
judgements, estimates and assumptions that affect
the reported amounts of revenues, expenses, assets
and liabilities, and the accompanying disclosures, and
the disclosure of contingent liabilities. Uncertainty
about these assumptions and estimates could result
in outcomes that require a material adjustment to
the carrying amount of assets or liabilities affected in
future periods. Difference between actual results and
estimates are recognised in the periods in which the
results are known / materialised.

Estimates and assumptions:

The key assumptions concerning the future and other
key sources of estimation uncertainty at the reporting

date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described
below. The Company has based its assumptions and
estimates on parameters available when the financial
statements were prepared. Existing circumstances
and assumptions about future developments, however,
may change due to market changes or circumstances
arising that are beyond the control of the Company.
Such changes are reflected in the assumptions when
they occur.

a) Employee benefit plans

The Company’s obligation on account of gratuity
and compensated absences is determined based
on actuarial valuations. An actuarial valuation
involves making various assumptions that may
differ from actual developments in the future.
These include the determination of the discount
rate, future salary increases and mortality rates.
Due to the complexities involved in the valuation
and its long-term nature, these liabilities are highly
sensitive to changes in these assumptions. All
assumptions are reviewed at each reporting date.
The parameter most subject to change is the
discount rate. In determining the appropriate
discount rate, the management considers the
interest rates of government bonds in currencies
consistent with the currencies of the post¬
employment benefit obligation.

The mortality rate is based on publicly available
mortality tables. Those mortality tables tend
to change only at interval in response to
demographic changes. Future salary increases
and gratuity increases are based on expected
future inflation rates.

Further details about gratuity obligations are
given in Note 36.

b) Fair value measurement of financial instruments

When the fair values of financial assets and
financial liabilities recorded in the balance sheet
cannot be measured based on quoted prices in

active markets, their fair value is measured using
valuation techniques including the DCF model.
The inputs to these models are taken from
observable markets where possible, but where
this is not feasible, a degree of judgement is
required in establishing fair values. Judgements
include considerations of inputs such as
liquidity risk, credit risk and volatility. Changes in
assumptions about these factors could affect the
reported fair value of financial instruments. See
Note 43 and 44 for further disclosures.

c) Useful Lives of Property, Plant & Equipment:

The Company uses its technical expertise
along with historical and industry trends for
determining the economic life of an asset/
component of an asset. The useful lives are
reviewed by management periodically and
revised, if appropriate. In case of a revision, the
unamortised depreciable amount is charged over
the remaining useful life of the assets.

d) Taxes:

Current tax: Current income tax assets and
liabilities are measured at the amount expected
to be recovered from or paid to the taxation
authorities. As stated in Note 16, tax expense is
calculated using applicable tax rates and tax laws
that have been enacted or substantively enacted.
In arriving at taxable profit and tax bases of assets
and liabilities, the Company recognised taxability
of amounts in accordance with tax enactments,
case law and opinions of tax counsel, as relevant.
Where differences arise on tax assessment, these
are booked in the period in which they are agreed
or on final closure of assessment.

Deferred tax: Deferred tax is provided using the
liability method on temporary difference between
the tax bases of assets and liabilities and their
carrying amounts for financial reporting purposes
at the reporting date.

Note:

The above valuation of the investment properties are in accordance with the Ready Reckoner rates prescribed by
the Government of Maharashtra for the purpose of levying stamp duty. The Independent Valuer has referred to the
publications and Government website for Ready Reckoner rates. Suitable adjustments if required have been made to
account for availability of FSI in land parcels in Mumbai in accordance with the guidelines prescribed by the Department
of Registrations and Stamps. The adjustments related to floors, lifts and other factors are not considered for valuation of
commercial property. Since the valuation is based on the published Ready Reckoner rates, the Company has classified the
same under Level 2.

Directors vide its resolution dated January 16, 2023 and also by Shareholders through postal ballot via remote
e-voting on March 09, 2023 in terms of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations,
2021. Accordingly the Company has considered the related expenses amounting to INR 5.99 Crores (31 March
2025 - INR 11.78 Crores) incurred during the year ended 31 st March, 2026 as deemed capital contribution in the
subsidiary Company in accordance with Ind AS 102 'Share Based Payments’.
ii) During the year, the Company has made an investment of INR 100 Crore into the equity share capital of Birla
Estates Private Limited, its wholly owned subsidiary, through subscription to 10,00,00,000 equity shares of face
value INR 10 each at par.

Notes :

(i) No trade receivable are due from directors or other officers of the Company either severally or jointly with any other
person. Nor any trade receivable are due from firms or private companies respectively in which any director is a partner
or a director or a member. Trade receivables are non interest bearing and are generally on terms of 7 to 120 days of credit
period.

(ii) Trade receivables ageing schedule

NoteI. Details of Security:1. Loans covered in Sr. No. 9 & 10 :

(i) First pari passu charge on present and future movable fixed assets of borrower's Pulp and Paper unit at Lalkuan,
Uttarakhand.

2. Loans covered in Sr. No. 8 :

(i) First pari passu charge on current assets (including documents of title to goods/ related receivables).

3. Loans covered in Sr. No. 11 & 12 :

(i) Registered Mortgage on Project Land and structure thereon.

(ii) Hypothecation of future scheduled receivables of the project and all insurance both present & future of the
project only

(iii) Hypothecation of Escrow account and all investments in respect thereof.

II Loans covenants:

Bank loan and NCDs contain certain debt covenants relating to total term loan to tangible net worth, fixed asset coverage
ratio, net debt to equity ratio, debt service coverage ratio, total debt to EBITDA and interest coverage ratio. The Company
is compliant with the said covenants during the year ended 31 March 2026. The Company has also satisfied all other debt
covenants prescribed in the terms of bank loan and NCDs.

The Company has not defaulted in repayment of borrowing and interest thereon.

(i) Unclaimed dividend amounting to Rs 0.05 crore (31 March 2025 INR 0.05 crore) is pending on account of litigation among
claimants / notices from the tax recovery officer.

(ii) Derivative financial instruments:

The Company entered into foreign exchange forward contracts with the intention of hedging foreign exchange risk of
expected sales and purchases, these contracts are not designated as hedge and are measured at fair value through profit
or loss.

Derivative instruments at fair value through profit or loss reflect the negative change in fair value of those foreign exchange
forward contracts that are not designated in hedge relationships, but are, nevertheless, intended to reduce the level of
foreign currency risk for expected sales and purchases.

(iii) Changes in liabilities arising from financing activities (excluding lease liabilities)

Nature of security

(i) Working capital demand loan form Banks of INR 65.52 Crores (31 March 2025 INR 107.75 crores) are secured against
a first and pari passu charge over the current assets (including documents of title to goods/related receivables) and
collateral security on a pari-passu basis over the present and future property plant and equipments (plant and machinery)
of Century Pulp and Paper.

(ii) Line of credit from banks of INR 25 crores (31 March 2025 INR 50.00 crores) are secured against a first and pari passu
charge with other facility by way of registered mortgage on the property, project, future scheduled receivable of the project
on the company’s Birla Niyaara Project.

(iii) Cash credit / Overdraft facility of INR 0.30 crores (31 March 2025 INR 61.41 crores) are secured against a first and
pari passu charge with other facility by way of registered mortgage on the property, project, future scheduled
receivable of the project and all insurance proceed, both present and future, on security of all rights, title, interest,
claims, benefits, demands under the project documents of both present and future, on the escrow and DSR
account of the project including all monies credited / deposited therein and all investment in respect thereof.
All such sold units of secured project, booking of which are subsequently cancelled by customer shall continue to stand
mortgaged to the lender.

NOTE 21E | REMAINING PERFORMANCE OBLIGATION

In case of residential units, the Company satisfies the performance obligation and recognises revenue at a point in time i.e.,
upon handover of the residential units. Since the said performance obligation is not satisfied as at March 31,2026, no revenue
has been recognised by the Company on sale of residential units. The Company expects to recognise revenue on sale of
residential units in the following time band:

a. Post discontinuation of the Company’s Textiles business, the economic advantages to its Joint Venture ("JV"), Birla Advanced
Knits Private Limited, such as common utilities, shared manpower and integrated operations with Siro yarn spinning, were
lost; accordingly, the entity became non-viable and the JV’s business operations were discontinued. Both the JV partners
had an obligation to contribute equally towards the liabilities of the JV in excess of their respective investments. Accordingly,
the Company had recognised a provision aggregating to Rs. 114 Cr during the year ended March 31, 2025 towards its
exposure in the JV. As a result the company has made provision of diminution in value of Rs 25 Cr and balance Rs. 89 Cr was
disclosed as other current financial liabilities as obligation towards share of liability in joint venture for the year ended march
31,2025 ( Refer note 15). The contribution towards the aforesaid provision was made during the year.

Thereafter, the Company has contributed amount aggregating to Rs. 13.50 Crore for the year ended March 31, 2026,
towards the JV’s working capital requirements, which has been fully impaired and recognised as an exceptional item,
considering the exposure in the JV

b. The company was entitled to Worli West Colony comprises C. S. No. 1,546 leasehold land admeasuring 25,543.68 sq mtrs
(equivalent to 6.31 acres). Company had filed a writ Petition before the High Court of Bombay seeking a formal conveyance
of the land in its favor. The Hon’ble High Court of Bombay had passed a judgment dated March 14, 2022 inter alia directing
MCGM to execute a formal conveyance in favor of the Company. MCGM filed an appeal in the Hon’ble Supreme Court
against the said High Court Judgement and the Hon’ble Supreme Court had allowed the said Appeal. Pursuant to Supreme
Court Judgement the company had surrendered the land parcel to local authority, and as a result the company had written
off INR 42.89 Cr. pertaining to the said property during the previous year.

c. The Government of India has consolidated 29 existing labour legislations into a united framework comprising four Labour
Codes viz. the Code on Wages, 2019, the Code on Social Security, 2020, the Industrial Relations Code, 2020 and the
Occupational Safety, Health and Working Conditions Code, 2020 (collectively referred to as the "New Labour Codes").
These Codes have been made effective from 21st November, 2025. The corresponding supporting rules under these
Codes are yet to be notified. The labour codes, amongst other things, introduce changes including a uniform definition of
wages and enhanced benefits relating to leave.

The Company has assessed the financial implications of these changes, resulting in an increase in gratuity and leave
liability by Rs 36.23 Cr (both continuing and discontinued operations). Considering that the impact arising out of enactment
of the new legislation is an event of a non-recurring nature, the Company has presented this incremental amount as
"Impact of Labour Codes" under "Exceptional Items" in the statement of profit and loss for the year ended March 31,2026.

NOTE 33

During the financial year 2017-18, the Company had entered into an agreement with Grasim Industries Limited ('GIL’)
granting right to manage and operate the Company’s Viscose Filament Yarn ('VFY’) business, which is part of Textile
segment, for a duration of 15 years commencing from February 1, 2018. As a part of consideration, GIL has paid an
upfront Royalty of INR 605.00 crores. In addition GIL has also paid the carrying value of net working capital and the interest
free security deposit of INR 200.00 crores which is repayable after 15 years With effect from February 1, 2018, GIL have

right to use the VFY business assets including its intangible assets for a period of 15 years from the above date. The
Company is recognizing royalty income over the period of 15 years

Pursuant to the agreement, GIL shall incur all capital expenditure and commitments involving capital expenditure as may
be necessary for the proper, optimum and profitable operation of the VFY Business. In this regard, Company has agreed
that all improvement/ capital expenditure done by GIL during the tenure of agreement will be transferred to the Company,
at such fair value as may be agreed between the Company and GIL.

NOTE 34 | TRADE PAYABLES

(i) INR 3.48 Crore (31 March 2025 INR 3.29 Crore) due to micro and small enterprises registered under the Micro, Small and
Medium Enterprises Development Act, 2006 (MSMED Act). There are no other amounts paid / payable towards interest /
principal under the MSMED; and

(ii) The above information has been determined to the extent such parties have been identified on the basis of the information
available with the Company regarding the status of suppliers under the MSMED Act.

NOTE 35 | DISCONTINUED OPERATIONS(A) Textile Division

During the financial year 2023-24, the Company had discontinued operations at its Bharuch Textile Division business
('Division'). Accordingly, the said Division is disclosed as discontinued operations in the financial statements. During the
year, the Company carried out an assessment of the recoverable amount of its building. Based on the evaluation of expected
future economic benefits, the Company has recognised an impairment loss of INR 59.24 Cr. (March 31,2025: NIL).

(B) Pulp & Paper Division

Pursuant to approval of Board of Directors ("Board") of the Company at their meeting held on March 31,2025, the company
had executed a business transfer agreement (BTA) with the ITC Ltd. for sale and transfer of the Company’s pulp and paper
undertaking operated under the name of Century Pulp and paper. In terms of the requirements of Accounting Standards
(Ind AS), the assets and liabilities which would be transferred are presented as held for sale and the Pulp and Paper
business have been presented as 'Discontinued Operations’.

(a) Defined Contribution Plans:

The Company’s contribution to Provident Fund and Superannuation Fund aggregating INR 7.09 Crores (31 March
2025: INR 7.12 Crores) has been recognised in the Statement of Profit and Loss under the head Employee benefits
expense.

(b) Defined Benefit Plans:(i) Gratuity

The Company has a defined benefit gratuity plan (funded).The Company’s defined benefit gratuity plan is a final
salary plan for employees, which requires contributions to be made to a separately administered fund. 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 fund has the form of a trust and it is governed by the Board of Trustees, which
consists of an equal number of employer and employee representatives. The Board of Trustees is responsible for the
administration of the plan assets and for the definition of the investment strategy.

Each year, the Board of Trustees reviews the level of funding in the gratuity plan. Such a review includes the asset-
liability matching strategy and investment risk management policy. This includes employing the use of annuities
and longevity swaps to manage the risks. The Board of Trustees decides its contribution based on the results of this
annual review. Generally, it aims to have a portfolio mix of equity instruments, property and debt instruments. The
Board of Trustees aim to keep annual contributions relatively stable at a level such that no plan deficits (based on
valuation performed) will arise.

The significant actuarial assumptions used for the purposes of the actuarial valuations were as follows:

NOTE 37

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 direct changes to data for users with certain privileged access rights to
the SAP HANA application and/or the underlying HANA database. Further no instance of audit trail feature being tampered
with was noted in respect of other software. 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 respective years.

The amounts shown above represents the best possible estimates arrived at on the basis of available information. The
uncertainties are dependent on the outcome of the different legal processes. The timing of future cash flows will be
determinable only on receipt of judgments / decisions pending with various forums/authorities. The Company does not
expect any reimbursements against the above.

Note : The Government of India has consolidated 29 existing labour legislations into a united framework comprising four
Labour Codes viz. the Code on Wages, 2019, the Code on Social Security, 2020, the Industrial Relations Code, 2020 and
the Occupational Safety, Health and Working Conditions Code, 2020 (collectively referred to as the "New Labour Codes").
These Codes have been made effective from 21st November, 2025. The corresponding supporting rules under these
Codes are yet to be notified. The labour codes, amongst other things, introduce changes including a uniform definition of
wages and enhanced benefits relating to leave.

* The Company has made provision for diminution in value of Investment during the year.

Key Managerial Personnel are entitled to post-employment benefits and other long term employee benefits recognised
as per Ind AS 19 - 'Employee Benefits’ in the financial statements. As these employee benefits are lump sum amounts
provided on the basis of actuarial valuation, the same is included above on payment basis.

The sales, purchases, rental income, overhead recovery, job work charges, management fee from, rental expense to and
all other transactions with related parties are made on terms equivalent to those that prevail in arm’s length transactions.
The loans to related parties are generally for a term of 3-5 years, repayable out of project cashflows, at interest rates of 8%
to 8.50% per annum. Outstanding balances at the year-end are unsecured and interest free and the settlement will occur
in cash.

There have been no guarantees provided or received, for any related party receivables or payables except for corporate
guarantees given for Borrowing from Non Banking Financial Companies and dues of Land Owner of Wholly owned
Subsidiary and step down Subsidiary respectively. For the year ended 31 March 2026, the Company has not recorded any
impairment of receivables relating to amounts owed by related parties (31 March 2025: INR Nil) except for impairment of
Investment in Joint venture. 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

The remuneration of directors and key executives is determined by the nomination and remuneration committee having
regard to the performance of individuals and market trends

F. The Board of Directors monitors the operating results of its business units separately for the purpose of making decisions
about resource allocation and performance assessment.

G. No single customer contributed 10% or more to the Company’s revenue for the year ended 31 March 2026 and 31 March
2025

H. The accounting policies of the reportable segments are the same as the Company’s accounting policies described in note
2A.

Segment profit / (loss) represents the profit / (loss) before finance cost and tax earned by each segment without allocation
of central administration costs and directors’ salaries, investment income and finance costs. This is the measure reported
to the chief operating decision maker for the purposes of allocation and assessment of segment performance.

NOTE 42 | CAPITAL MANAGEMENT

For the purpose of the Company’s capital management, equity includes issued equity capital, convertible preference shares,
share premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the
Company’s capital management is to maximize the shareholder value. The Company’s Capital Management objectives
are to maintain equity including all reserves to protect economic viability and to finance any growth opportunities that may
be available in future so as to maximize shareholders’ value. The Company is monitoring capital using debt equity ratio
as its base which is debt to equity. The Company’s policy is to keep debt equity ratio below two and infuse capital if and
when required through issue of new shares and/or better operational results and efficient working capital management.

NOTE 43 | FINANCIAL RISK MANAGEMENT FRAMEWORK

The Company’s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other
payables. 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 FVTOCI investments and enters into derivative
transactions.

The Company is exposed to market risk, credit risk and liquidity risk. The Company’s senior management oversees these
risks management. The Company’s senior management provides assurance 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. All derivative activities for risk management purposes are
carried out by teams that have the appropriate skills, experience and supervision. The Board of Directors reviews and
agrees policies for managing each of these risks, which are summarised below.

A. Credit Risk

Credit risk is the risk that counter party will not meet its obligation under a financial instrument or customer contract
leading to a financial loss. The Company is exposed to credit risk mainly from trade receivables and other financial

assets. The Company only deals with parties which has good credit ratings / worthiness based on company’s internal
assessment.

The Company has divided parties in two grades based on their performance.

Good: parties with a positive external rating (if available) and stable financial position with no past default is considered
in this category.

Doubtful: parties where the company doesn’t have information on their financial position or has past trend of default
are considered under this category.

The Company has not acquired any credit impaired asset. There was no modification in any financial assets.

(i) Trade receivables

Customer credit is managed by each business division subject to the Company’s established policy procedures
and control related to customer credit risk management.

Total Trade Receivables as on March 31, 2026 is INR 13.81 crores ( March 31, 2025 INR 50.54
crores). The company does not have higher concentration of credit risk to a single customer.
The ageing analysis of the receivables are considered from the date of invoice (Refer note 10).
The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers
are located in several jurisdictions and industries and operate in largely independent markets and their credit
worthiness are monitored at periodical intervals. The maximum exposure to credit risk at the reporting date is
the carrying value of each class of financial assets.

The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers
are located in several jurisdictions and industries and operate in largely independent markets and their credit
worthiness are monitored at periodical intervals. The maximum exposure to credit risk at the reporting date is
the carrying value of each class of financial assets.

The Company has recognised loss allowance provision on trade receivables amounting to INR 6.48 crores
during the year (31 March 2025 INR 13.91 crores) as there was no reasonable expectations of recovery and
were outstanding for more than 360 days from becoming due.

(ii) Other Financial Assets

Credit risk from balances with banks is managed by Company’s treasury department in accordance with the
Company policy. Investment of surplus funds are made only in approved Mutual Funds and that too in liquid
funds. As soon as the fund reaches to a reasonable level the Company repays its working capital borrowing
by redeeming the liquid fund. The other financial assets are from various forum of Government authorities
and are released by Government authorities on completion of relevant terms and conditions for the release of
outstanding.

B. 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 of three types of risks - interest rate risk, currency risk and other price risk
in a fluctuating market environment. Financial instrument affected by market risks includes loans and borrowings,
deposits, FVTOCI Investments, derivatives and other financials assets.

The Company has designed risk management frame work to control various risks effectively to achieve the business
objectives. This includes identification of risk, its assessment, control and monitoring at timely intervals.

The sensitivity analyses in the following sections relates to the outstanding balance as at 31 March 2026 and 31
March 2025

The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating
interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all
constant in place at 31 March 2026.

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This
is based on the financial assets and financial liabilities held at 31 March 2026 and 31 March 2025.

(i) Currency Risk

This is the risk that the Company may suffer losses as a result of adverse exchange rate movement during
the relevant period. As a policy, Company is covering all foreign exchange risk on account of import and loans
so that Company may not be put to any loss situation due to adverse fluctuations in currency rates. There is
periodical review of foreign exchange transactions and hedging by the Company’s executives.

Foreign Currency Sensitivity

The following tables demonstrate the sensitivity to a reasonably possible change in USD, EUR, JPY and GBP
exchange rates, with all other variables held constant. The impact on the Company’s profit before tax is due

(ii) Interest rate risk

The Company manages interest rate risk by having a balanced portfolio of fixed and variable rate of interest on
loans and borrowings. To manage this, Company has issued fixed rate bonds and loans taken from banks are
linked to MCLR rate of the bank, which are variable.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that
portion of loans and 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:

(iii) Equity Price Risk

The Company is exposed to equity price risks arising from equity investments. Equity investments are held for
strategic rather than trading purposes. The Company does not actively trade these investments.

C. LIQUIDITY RISK(i) Liquidity risk management

The Company manages liquidity risk by continuously monitoring forecast and actual cash flows on daily,
monthly and yearly basis. The Company ensures that there is a free credit limit available at the start of the year
which is sufficient for repayments getting due in the ensuing year. Loan arrangements, credit limits with various
banks including working capital and monitoring of operational and working capital issues are always kept in
mind for better liquidity management

(ii) Maturities of financial liabilities

The following tables detail the Company’s remaining contractual maturity for its non-derivative financial liabilities
with agreed repayment periods. The amount disclosed in 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.
To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves
at the end of the reporting period. The contractual maturity is based on the earliest date on which the Company
may be required to pay.

Valuation technique and key input used: Fair value is determined using discounted future cash flows, which are estimated
at the end of the reporting period, discounted at a rate that reflects the credit risk of the Company.

The fair values of the quoted instruments (Investment in Mutual fund units and Equity shares) are based on the price
quotations at the reporting date.

The fair values of the unquoted equity instruments have been estimated using a replacement cost method. The valuation
requires management to make certain assumptions about the assets, liabilities, investments of Investee Company. The
probabilities of the various assumptions can be reasonably assessed and are used in management's estimate of fair value
for these unquoted equity investments based on the best information available to the Company.

The Company enters into foreign exchange forward contracts are valued using valuation techniques, which employs the
use of market observable inputs.

NOTE 45 | DISCLOSURE UNDER IND AS 116 “ LEASESLessee:

The Company has lease contracts for lands & buildings used in its operations. Leases of land and building generally have lease
terms between 3 and 99 years Generally, the Company is restricted from assigning and subleasing the leased assets.

During the year, the Nomination and Remuneration Committee of the Board of Directors of the Company has approved on
December 05, 2025, an aggregate grant of 8,772 (March 31, 2025: 42,439) stock options to the eligible employees of Birla
Estates Private Limited, a Wholly Owned Subsidiary of the Company under CTIL Employee Stock Option Scheme 2023 ('the
Scheme’).

The Scheme is implemented through the CTIL Employee Welfare Trust. Under the Scheme, the Trust acquired 12,52,480 equity
shares of the Company from the market. Out of these, 1,34,644 Shares have been exercised by the employees of Birla Estates
Private Limited, a wholly owned Subsidiary of the Company. Accordingly, the balance shares held by the Trust as of 31 st March
2026 stood at 11,17,836.The Company considers the Trust as an extension of itself, and consequently, the shares held by the
Trust are treated as treasury shares and adjusted against total equity. The details of the Scheme are provided below

Fair Valuation

The fair value of options used to compute proforma net income and earnings per equity share has been done by an independent
Valuer on the date of grant using Black-Scholes Model and Monte Carlo simulation approach.

The Key Assumptions in Black-Scholes Model and Monte Carlo simulation approach for calculating fair value as on the date of
grant are:

NOTE 48 | OTHER STATUTORY INFORMATION

(i) No proceedings have been initiated or are pending against the Company for holding any Benami property under the
Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

(ii) The Company does not have any transactions with companies struck off.

(iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory
period.

(iv) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with
Companies (Restriction in number of Layers) Rules, 201

(v) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

(vi) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities
(Intermediaries) with the understanding the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of
the company (Ultimate Beneficiaries) or

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

(vii) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with
the understanding (whether recorded in or otherwise) that the Company shall:

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

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

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

(ix) The Company has not been declared as wilful defaulter by any bank or financial institution or other lender.

NOTE49~

Figures less than INR 50,000 have been shown at actuals in brackets, since the figures are rounded off to the nearest
lakh.