b) Rights, preferences and restrictions attached to the equity shares

The Company has only one class of shares referred to as equity shares having a par value of ' 10 per share. Each holder of equity shares is entitled to one vote per share held. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of other equity

(i) Securities premium

Securities premium reserve is used to record the premium received on issue of shares. The reserve is utilised in accordance with the provisions of the Act.

(ii) General reserve

This represents appropriation of profit by the Company and is available to the shareholders for distribution.

(iii) Remeasurement of defined benefit plans, net of tax

This represents actuarial re-measurements of the defined benefits plan.

(iv) Other reserve

This represents cost related to employee stock option plans (equity-settled) awarded to employees of the Company by its Holding Company which has not been cross charged.

(v) Retained earnings

The cumulative gain or loss arising from the operations which is retained by the Company is recognised and accumulated under the heading of retained earnings. At the end of the year, the profit after tax is transferred from the statement of profit and loss to retained earnings.

For the financial year 2025-26, the Board recommended a dividend of ' 506 per equity share (final dividend of ' 160 per equity share and special dividend of ' 346 per equity share) at its meeting held on May 22, 2026. This payment is subject to the approval of the Shareholders in the ensuing Annual General Meeting of the Company.

d) The amount of ' 3.42 crores included in contract liabilities (advance from customers) at March 31, 2025 has been recognised as revenue during the year ended March 31, 2026 (March 31, 2025 : ' 3.55 crores).

e) No information is provided about remaining performance obligations at March 31, 2026 or at March 31, 2025 that have an original expected duration of one year or less, as allowed by Ind AS 115.

f) Invoices generally have payment terms of 30 to 90 days.

27 INTER COMPANY AGREEMENTS AND ARRANGEMENTS

a) Intellectual property agreement (Royalty expense)- The Company has entered into Intellectual Property agreement with 3M Innovative Properties Company and 3M Company, USA effective July 1, 2006 for the payment of license fees in the form of royalties. Payments were waived off for a period of 3 years effective from July 1, 2006 to June 30, 2009. The Intellectual Property Agreement with 3M Innovative Properties Company and 3M Company, USA has been revised effective April 1, 2023. Accordingly, the Company has incurred an expenditure of ' 86.71 crores for the year ended March 31, 2026 (March 31, 2025: ' 75.48 crores) and disclosed as Royalty under other expenses (refer note 25).

b) Corporate management fees - In order to avail economies of scale , the Company has entered into inter-company services support services agreement with 3M Global Service Center Management Company, USA (having expertise in establishing, operating and managing international business and incurring costs in developing, manufacturing, marketing and selling a diverse portfolio of products) with effect from April 1, 2019. The Company is charged with comprehensive support services charges by 3M Global Service Center Management Company for the services received from all the 3M group companies in the areas of Laboratory, Technical assistance and Manufacturing, Selling and Marketing, Strategic and Managerial, Information Technology, Routine Administration and Foreign Services Employees Expenses and Outsourced Services of Transaction Processing on competitive conditions. Accordingly, the Company has incurred an expenditure of ' 129.37 crores for the year ended March 31, 2026 (March 31, 2025: ' 124.18 crores) and disclosed as corporate management fee under other expenses (refer note 25).

c) Contract research agreement - The Company has entered into contract research agreement with 3M Innovative Properties Company and 3M Company, USA effective July 1, 2006 for carrying out contract research activities. During the year, Company has recognized an income of ' 24.02 crores (March 31, 2025: ' 22.40 crores).

A. Description of share based payment arrangements

Stock appreciation rights and Restricted stock units (cash-settled)

3M Company, USA has established 3M Company Long Term Incentive Plan (LTIP). As a part of the plan, eligible employees of the Company are entitled to participate in cash settled stock options - stock appreciation rights (SARs) and restricted stock units (RSUs) of 3M Company, USA. The eligible employees are granted stock options which will vest with the employees over a period of 3 years from the date of the grant and they can exercise the stock option within a stipulated period mentioned in the plan. In case of SARs, the employee (on the date of exercise) gets the compensation as a difference between market price on the date of exercise and grant date fair value. In case of RSUs, the employee (on the date of exercise) gets the compensation which is equal to market price on the date of exercise. As of the year end a sum of ' 42.11 crores (March 31, 2025: ' 50.97 crores) is liability and the same is included as ‘Employee benefit obligation’ under Other financial liabilities (refer note 16).

B. Measurement of fair values

The Company measures compensation expense for stock appreciation rights (SARs) at their fair value determined using Black - Scholes Model and restricted stock units (RSUs) based on fair market value of shares of 3M Company, USA as on reporting date.

The expected term of the SARs is estimated based on the vesting term and contractual term of the SARs, as well as expected exercise behavior of the employee who receives the SAR. Expected volatility during the expected term is based on historical volatility of the observed market prices of the 3M Company USA’s publicly traded equity shares particularly over the historical period commensurate with the expected term.

D. Expense recognised in Statement of profit and loss

An amount of ' 13.11 crores has been debited (March 31, 2025: ' 28.95 crores has been debited) to the statement of profit and loss for the year and included under Employee benefit expenses.

E. The weighted average share price at the date of exercise with regards to SARs and RSUs exercised during the year is USD 148.87 and USD 145.23 respectively (March 31, 2025: USD 151.45 and USD 149.87 respectively)

Employee Stock Option Plan

A. Description of share based payment arrangements

Stock appreciation rights and Restricted stock units (Equity-settled)

3M Company, USA has established 3M Company Long Term Incentive Plan (LTIP). As a part of the plan, eligible employees of the Company are entitled to acquire shares of 3M Company, USA via stock options i.e., stock appreciation rights (SARs), restricted stock units (RSUs) and performance stock units (PSUs). The eligible employees are granted stock options which will vest with the employees over a period of 3 years from the date of the grant and they can exercise the stock option within a stipulated period mentioned in the plan. In case of SARs, the employee (on the date of exercise) gets the compensation as shares for the difference between market price on the date of exercise and grant date fair value. In case of RSUs and PSUs, the employee (on the date of exercise) gets the compensation as shares. As of the year end a sum of ' 2.26 crores (March 31, 2025: ' Nil) is shown as other equity in statement of changes in equity.

B. Measurement of fair values

The Company measures compensation expense for stock appreciation rights (SARs) at fair value using the Black-Scholes option pricing model. Restricted stock units (RSUs) are measured based on the fair market value of 3M Company’s shares, and performance stock units (PSUs) are measured at fair value using a Monte Carlo valuation model, in each case as of grant date.

The expected term of the SARs is estimated based on the vesting term and contractual term of the SARs, as well as expected exercise behavior of the employee who receives the SAR. Expected volatility during the expected term is based on historical volatility of the observed market prices of the 3M Company USA’s publicly traded equity shares particularly over the historical period commensurate with the expected term.

The expected term of the PSUs is estimated based on the vesting term and contractual term of the PSUs, as well as expected exercise behavior of the employee who receives the PSUs. Expected volatility during the expected term is based on historical volatility of the observed market prices of the 3M Company USA’s publicly traded equity shares particularly over the historical period commensurate with the expected term.

a) Defined contribution plan

The Company offers its employees defined contribution plans in the form of Provident Fund (PF) and Superannuation Fund (SF). Contribution to SF is made to 3M India Limited Employees Superannuation Fund Trust and 3M E & C India Employees Superannuation Fund Trust. Other contributions are made to the Government’s funds. While both the employees and the Company pay predetermined contributions into the Provident Fund, contributions into superannuation fund are made only by the Company. The contributions are normally based on a certain proportion of the employee’s salary.

b) Defined benefit plan

The Company provides for gratuity, a defined benefit plan (the Gratuity Plan), to its employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, of an amount based on the respective employee’s last drawn salary and years of employment with the Company. The Company contributes all ascertained liabilities towards gratuity to the 3M India Limited Employees Gratuity Fund Trust. Trustees administer contributions made to the trust. As of March 31, 2026 and March 31, 2025, the plan assets have been primarily invested in insurer managed funds.

31 SEGMENT REPORTING

A) Basis for segmentation

Ind AS 108 establishes standards for the way that public business enterprises report information about operating segments and related disclosures about products and services, geographic areas, and major customers. Based on the “management approach” as defined in Ind AS 108, the Chief Operating Decision Maker (CODM) evaluates the Company’s performance and allocates resources based on an analysis of various performance indicators by segments. The accounting principles used in the preparation of the financial statements are consistently applied to record revenue and expenditure in individual segments, and are as set out in the significant accounting policies.

The Company operates mainly to the needs of domestic market and export turnover is not significant in context of total turnover. Accordingly, there are no reportable geographical segments. The Company has four reportable segments, as described below.

For each of the segments, the Company’s Managing Director, who is the CODM, reviews internal management reports on at least a quarterly basis.

Segment revenue, results, assets and liabilities figures include the respective amounts identifiable to each of the segments. Other unallocable income net off unallocable expenditure are towards common services to the segments which are not directly identifiable to the individual segments as well as those at a corporate level which relate to the Company as a whole.

The following summary describes the products included in each of the Company’s reportable segment:

B) Information about reportable segments

Information regarding the results of each reportable segment is included below. Performance is measured based on segment profit (before tax), as included in the internal management reports that are reviewed by the CODM. Segment profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries.

No customers have individually accounted for more than 10% of the revenues during the years ended March 31, 2026 and March 31, 2025.

Notes:

(i) Income tax matters in the previous years were primarily related to transfer pricing adjustments made by the Income-tax authorities with respect to disallowance of intercompany charges. During the current year, the Company has signed an Advance Pricing Agreement (“APA”) with the CBDT to settle these transfer pricing adjustments related to FY 2014-15 to FY 2022-23. Accordingly, the Company has created a provision for ' 170.96 crores (including interest) and hence excluded from the contingent liability disclosure as at March 31, 2026.

(ii) Custom duty demand primarily includes an amount of ' 163.88 crores (tax ' 76.94 crores, interest and penalty ' 86.94 crores) towards a Show Cause Notice dated 8 December 2016 by the Directorate of Revenue Intelligence (DRI) in relation to levy of customs duty on inter-company transactions for import of goods and services and hence proposing to demand differential duty of customs covering the transactions during the period December 8, 2011 to February 7, 2014. The Company has received an order in original on October 1, 2017 from Additional Director General - DRI (Adjudication), Mumbai confirming the demand raised for custom duty.

(iii) Sales tax cases primarily pertains to Maharashtra Value Added Tax Act, 2002 and Karnataka Value Added Tax Act, 2003. These are pertaining to the years from 2006-07 to 2017-18. These cases are with respect to the applicable rate of tax for various products and matters pertaining to declaration forms.

(iv) Service tax matters relate to cases pertaining to alleged non-payment of service tax on R&D services rendered to related parties.

(v) Excise matters relates to penalty for allegedly dealing in goods liable to confiscation under Rule 26 of the Central Excise Act and Valuation/ allowability of CENVAT credit under the Central Excise Act.

(vi) The Goods and service tax matter majorly relates to classification, disallowances of input tax credit for the year 2017 to 2024, notices received upon GST Audits for year 2017-18 to 2023-24, and transition of credit through TRAN-1 for year 2016-17 and 2017-18.

(a) The Company had filed an application for an Advance Pricing Agreement (“APA”) on March 28, 2018 to resolve certain ongoing transfer pricing related tax litigation matters pertaining to financial years 2014-15 to 2022-23. Following multiple discussions and negotiations with the APA authorities, the Company has received the final draft APA approved by the Central Board of Direct Taxes (“CBDT”) on January 6, 2026 which got subsequently signed on February 23, 2026. Accordingly, the Company has recognised tax expense of ' 139.47 crores and related interest thereon of ' 31.49 crores during the year ended March 31, 2026.

(b) On April 30, 2025, the Company had filed an application under the Direct Tax Vivad Se Vishwas Scheme, 2024 (‘VSV Scheme’) enacted vide Chapter IV of the Finance Act, 2024 with a view to settle long pending disputes and litigations relating to certain past years (ranging from 2004-05 to 2013-14) which existed as on March 31, 2025 and accordingly had recognised a tax expense of ' 98.91 crores during the year ended March 31, 2025.

36 CAPITAL MANAGEMENT

The Company’s policy is to maintain a stable capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors capital on the basis of return on capital employed as well as the debt to total equity ratio.

For the purpose of debt to total equity ratio, debt is debt as considered under long-term and short-term borrowings which is on account of finance lease on office equipment and vehicles. Total equity comprise of issued share capital and all other equity reserves.

37 FINANCIAL INSTRUMENTS - FAIR VALUES AND RISK MANAGEMENT

A) Accounting classification and fair values

a) Fair value through other comprehensive income (FVTOCI) - Where the financial assets are held not only for collection of cash flows arising from payments of principal and interest but also from the sale of such assets. Such assets are subsequently measured at fair value, with unrealised gains and losses arising from changes in the fair value being recognised in other comprehensive income.

b) Fair value through profit or loss (FVTPL) - Where the assets are managed in accordance with an approved investment strategy that triggers purchase and sale decisions based on the fair value of such assets. Such assets are subsequently measured at fair value, with unrealised gains and losses arising from changes in the fair value being recognised in the Statement of Profit and Loss in the period in which they arise.

c) Amortised cost - Where the financial assets are held solely for collection of cash flows arising from payments of principal and/or interest.

The fair value of financial assets and financial liabilities approximates to their carrying amount largely due to the short-term nature of these instruments.

B) Financial Risk Management

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

- Credit risk

- Liquidity risk

- Market risk

i) Risk management framework

The Company’s principal financial liabilities comprise finance lease obligations, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include trade and other receivables, cash and cash equivalents that are derived directly from its operations.

ii) Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers.

a) Financial assets that are not credit impaired

The Company has financial assets which are in the nature of cash and cash equivalents, loans to employees, unbilled revenue from related party, interest accrued on fixed deposits and receivables from related parties which are not credit impaired. These are contractually agreed with either banks, related parties or employees where the probability of default is negligible.

b) Financial assets that are credit impaired Trade receivables

The credit services team has established a credit policy under which each new customer is analysed individually for creditworthiness before the Company’s standard payment and delivery terms and conditions are offered. The Company’s review includes external ratings, if they are available. Sale limits are established for each customer and reviewed yearly.

The Company establishes an allowance for impairment that represents its estimate of expected losses in respect of trade receivables.

Expected credit loss assessment for the Company as at March 31, 2026 and March 31, 2025:

The Company has divided all the debtors outstanding for the last twelve quarters into age brackets of not due, 0-90 days, 91-180 days, 181-270 days, 271-365 days and amounts outstanding for more than one year. The Company has calculated the impairment loss arising on account of past trends in the default rate for time bucket.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating expected credit losses, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Company’s historical experience and informed credit assessment and including forward looking information. Expected credit losses are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the Company in accordance with the contract and the cash flows that the Company expects to receive).

iii) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.

The Company believes that the working capital is sufficient to meet its current requirements. Accordingly, no liquidity risk is perceived.

The table below provides details regarding the contractual maturities of significant financial liabilities -

iv) Market risk

Market risk is the risk that changes in market prices - such as foreign exchange rates will affect the Company’s income or the value of its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign currency receivables and payables. The Company is exposed to market risk primarily related to foreign exchange rate risk. Thus, the exposure to market risk is a function of revenue generating and operating activities in foreign currency. The objective of market risk management is to avoid excessive exposure in our foreign currency revenues and costs.

38 LEASES

The Company has taken vehicles, leasehold improvements, data processing equipment, office premises and warehouse. These leases typically run for a period of eleven months to ninety six months, with an option to renew the lease after that date. For certain leases, the Company is restricted from entering into any sub-lease arrangements. Information about leases for which the Company is a lessee is presented below.

40 No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

41 EXCEPTIONAL ITEM

On November 21, 2025, the Government of India notified the four Labour Codes - 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 - consolidating 29 existing labour laws. The Ministry of Labour & Employment published Central Rules and FAQs to enable assessment of the financial impact due to changes in regulations. The Company has evaluated and disclosed the incremental impact of these changes using the best information currently available, consistent with the guidance provided by the Institute of Chartered Accountants of India. Considering the materiality and regulatory-driven, non-recurring nature of this impact, the Company has presented such incremental impact amounting to ' 34.33 crores for year ended March 31, 2026. The increase is primarily on account of past service cost for gratuity due to change in wage definition for employees. The Company continues to monitor the finalisation of Central/ State Rules and clarifications from the Government on other aspects of the Labour Code and would provide appropriate accounting effect on the basis of such developments as needed.

42 The Company’s annual financial statements has been presented in ' crores in the current year. Accordingly, the

previous period figures which were presented in lakhs have been rounded off to crores for comparative purpose. This

change has no impact on the financial results or position of the Company.

43 OTHER STATUTORY INFORMATION

i) The Company does not have any Benami property or any proceeding is pending against the Company for holding any Benami property.

ii) The Company do not have any charges or satisfaction which is yet to be registered with Registrar of Companies beyond the statutory period.

iii) The Company has not traded or invested in crypto currency or virtual currency during the financial year.

iv) The Company is not classified as wilful defaulter.

v) The Company doesn’t have any 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.

vi) The Company has no transactions with the struck off companies.

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