2.18 Provisions, Contingent liabilities, and
Contingent assets
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 an outflow
of resources embodying economic benefits will
be required to settle the obligation and a reliable
estimate can be made of the amount of the
obligation. Expected future operating losses are
not provided for.

Where the Company expects some or all of the
expenditure required to settle a provision will be
reimbursed by another party, the reimbursement
is recognised when, and only when, it is virtually
certain that reimbursement will be received if the
Company settles the obligation. The reimbursement
is treated as a separate asset.

Provisions for onerous contracts, i.e., contracts
where the expected unavoidable costs of meeting
obligations under a contract exceed the economic
benefits expected to be received, are recognized
when it is probable that an outflow of resources
embodying economic benefits will be required
to settle a present obligation as a result of an
obligating event, based on a reliable estimate of
such obligation.

Contingent liability:

Contingent liability is a possible obligation
arising from past events and whose existence
will be confirmed only by the occurrence or
non-occurrence of one or more uncertain future
events not wholly within the control of the Company

or a present obligation that arises from past events
but is not recognized because it is not probable
that an outflow of resources embodying economic
benefits will be required to settle the obligation or
the amount of the obligation cannot be measured
with sufficient reliability. The Company does not
recognize a contingent liability but discloses its
existence in the financial statements.

Contingent asset:

Contingent asset is not recognised in financial
statements since this may result in the
recognition of income that may never be realised.
However, when the realisation of income is virtually
certain, then the related asset is not a contingent
asset and is recognized.

Provisions, contingent liabilities, and contingent
assets are reviewed at each balance sheet date.

2.19 Warranty

The estimated liability for product warranties is
recorded when products are sold. These estimates
are established using historical information on the
nature, frequency and average cost of warranty
claims and management estimates regarding
possible future incidence based on corrective
actions on product failures. The timing of outflows
will vary as and when warranty claim will arise, being
typically between three months to twenty years.

2.20 Earnings per share

Basic earnings per share is calculated by dividing
the net profit or loss for the period attributable
to equity shareholders by the weighted average
number of equity shares outstanding during the
period. The weighted average number of equity
shares outstanding during the period is adjusted
for events such as bonus issue, bonus element in a
rights issue to existing shareholders, share split and
reverse share split (Consolidation of shares) that will
change the number of equity shares outstanding,
without a corresponding change in resources.

Diluted earnings per share is computed by dividing
the profit/(loss) after tax as adjusted for dividend,
interest (net of any attributable taxes) other
charges to expense or income relating to the
dilutive potential equity shares, by the weighted
average number of equity shares considered for
deriving basic earnings per share and the weighted
average number of equity shares which could

have been issued on the conversion of all dilutive
potential equity shares.

Potential equity shares are deemed to be dilutive
only if their conversion to equity shares would
decrease the net profit per share or increase the net
loss per share. Potential dilutive equity shares are
deemed to be converted as at the beginning of the
period, unless they have been issued at a later date.

2.21 Foreign currency translations

Foreign currency transactions are translated into
the functional currency using the exchange rates
at the dates of the transactions. Foreign exchange
gains and losses resulting from the settlement
of such transactions and from the translation of
monetary assets and liabilities denominated in
foreign currencies at year end exchange rates are
recognised in the statement of profit and 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. Non-monetary items measured
at fair value in a foreign currency are translated
using the exchange rates at the date when the fair
value is determined.

The gain or loss arising on translation of
non-monetary items measured at fair value is
treated in line with the recognition of the gain or
loss on the change in fair value of the item (i.e.,
translation differences on items whose fair value
gain or loss is recognised in OCI or profit or loss are
also recognised in OCI or profit or loss, respectively).

2.22 Operating segments

Operating segments are reported in a manner
consistent with the internal reporting provided to
the chief operating decision maker (CODM).

The Company's CODM is the Chief Executive Officer
(CEO). The Company is engaged in manufacture
and sale of mattress, furniture and accessories
and its principal geographical segment is India.
The Company's operating businesses are organized
and managed as a single operating segment.
Consequently, the CODM believes that there are no
reportable segments as required under Ind AS 108
‘Operating segments'

2.23 Cash and cash equivalents

Cash and cash equivalents comprise cash at banks
and in hand, cheque at hand / remittance in transit
and short-term deposits with an original maturity
of three months or less, which are subject to an
insignificant risk of changes in value.

2.24 Statement of cash flows

Cash flows are reported using the indirect method as
set out in Indian Accounting Standard (Ind AS ) 7 on
Statement of Cash Flows, whereby profit/(loss) for
the year is adjusted for the effects of transactions
of a non-cash nature, any deferrals, or accruals of
past or future operating cash receipts or payments
and item of income or expenses associated with
investing or financing cash flows. The cash flows
from operating, investing, and financing activities
of the Company are segregated.

2.25 Earnings before finance costs, depreciation
and amortisation expense, exceptional items
and tax

As permitted by the Guidance Note on Division II -
Ind AS Schedule III to the Companies Act 2013, the
Company has elected to present earnings before
finance costs, depreciation and amortisation
expense, and tax as a separate line item on the face
of the statement of profit and loss. The Company
measures earnings before finance costs,
depreciation and amortisation expense, and tax
on the basis of profit/(loss) . In its measurement,
the Company does not include finance costs,
depreciation and amortisation expense, and
income tax expenses.

2.26 Recent accounting pronouncements

On May 07, 2025, and August 13, 2025, the Ministry
of Corporate Affairs (MCA), notified Companies
(Indian Accounting Standards) Amendment Rules,
2025 and Companies (Indian Accounting Standards)
Second Amendment Rules, 2025, respectively,
effective on or after April 01, 2025.

These amendments did not impact the financial
statements of the Company.

Standards / Specific amendments issued but
not yet effective

Ind AS 1 - Presentation of Financial Statements -

For accounting periods beginning on or after April 01,
2026, when an entity breaches any covenant of a

long-term loan arrangement on or before the end
of the reporting period with the effect that the
liability becomes payable on demand, it classifies
the liability as current, even if the lender agreed,
after the reporting period and before the approval
of the financial statements for issue, not to demand
payment as a consequence of the breach. An entity
classifies the liability as current because, at the
end of the reporting period, it does not have the
right to defer its settlement for at least 12 months
after that date. However, an entity classifies the

liability as non-current if the lender agreed by the
end of the reporting period to provide a period of
grace ending at least 12 months after the reporting
period, within which the entity can rectify the
breach and during which the lender cannot demand
immediate repayment.

This amendment is to be applied retrospectively
for annual reporting periods beginning on or after
April 01,2026, in accordance with Ind AS 8, Accounting
Policies, Accounting Estimates and Errors

Raw materials inventory includes goods in transit of ' 151.02 Million as at March 31, 2026 (March 31, 2025:
' 87.66 Million).

The provision estimated by the management for slow moving and non-moving inventories as at March 31, 2026
amounted to ' 483.05 Million (March 31, 2025: ' 358.30 Million). In case of raw materials, the provision for slow
moving and non-moving inventories is included in the costs of materials consumed and in case of finished
goods, work in progress and stock in trade, it is included in changes in inventories of finished goods, work in
progress and stock in trade.

* Working capital facilities are secured by hypothecation of inventories of the Company, both present and future.

** Finished goods include right to recover returned assets.

(b) The Board of Directors at its meeting held on May 13, 2025, approved the bonus issue of equity shares in
the ratio of 1:11 i.e., 11 equity shares will be issued for every 1 equity share held by the Shareholder, which
was further approved by the Shareholders vide special resolution in their Extra Ordinary General Meeting
dated May 13, 2025. The record date for the bonus issue was May 13, 2025 and the allotment date for the
bonus issue was May 14, 2025. Accordingly, 144,399,706 equity shares were issued.

(c) The Board of Directors, at its meeting held on November 12, 2025, approved the conversion of entire CCCPS
i.e Series A, Series B, Series C, Series D and Series D1, into 147,087,468 equity shares of the Company, in
accordance with the approved conversion ratio. The date of allotment was November 12, 2025.

(d) During the year ended March 31, 2026, the Company has raised ' 559.99 Million as part of Pre-IPO proceeds
from issue of 2,871,794 equity shares with a face value of ' 1 each at an issue price of ' 195 each, which
was further approved by the Shareholders vide special resolution in their Extra Ordinary General Meeting
dated November 08, 2025. The date of allotment was November 14, 2025.

(e) During the years ended March 31, 2026, and March 31, 2025, certain employees of the Company exercised
their vested ESOPs. As a result, during the year ended March 31, 2026, the Company issued 3,138,074
equity shares (March 31, 2025: 179,071 equity shares) of ' 1 each.

(ii) Rights, preferences and restrictions attached to equity and different classes of preference shares

A. Equity shares

The Company has a single class of equity shares. The holder of the equity shares are entitled to receive
dividend as declared from time to time subject to payment of dividend to preference shareholders.
Each holder is entitled to one vote per share. In the event of liquidation of the Company, the holders of the
equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of
all preferential amounts, if any, in proportion to the number of equity shares held by the shareholders.

B. Instruments entirely equity in nature (before their conversion on November 12, 2025)

CCCPS - Series A

Subject to compliance with law, each Series A CCCPS shall automatically be converted into equity shares in
the ratio of 1:11.9964, at the conversion price then in effect, upon the earlier occurrence of following events:

(i) 1 (One) day prior to the expiry of 20 (Twenty) years from the date of their issuance; or

(ii) In connection with an IPO, prior to the filing of a red herring prospectus by the Company with the
competent authority or such later date as may be permitted under law. Refer note 16(i)(c) for
further details.

CCCPS - Series B

Subject to compliance with law, each Series B CCCPS shall automatically be converted into equity shares in
the ratio of 1:13.0044, at the conversion price then in effect, upon the earlier occurrence of following events:

(i) 1 (One) day prior to the expiry of 20 (Twenty) years from the date of their issuance; or

(ii) In connection with an IPO, prior to the filing of a red herring prospectus by the Company with the
competent authority or such later date as may be permitted under law.

Refer note 16(i)(c) for further details.

CCCPS - Series C

Subject to compliance with law, each Series C CCCPS shall automatically be converted into equity shares in
the ratio of 1:15.6648, at the conversion price then in effect, upon the earlier occurrence of following events:

(i) 1 (One) day prior to the expiry of 20 (Twenty) years from the date of their issuance; or

(ii) In connection with an IPO, prior to the filing of a red herring prospectus by the Company with the
competent authority or such later date as may be permitted under law.

Refer note 16(i)(c) for further details.

CCCPS- Series D

Subject to compliance with law, each Series D CCCPS shall automatically be converted into equity shares in
the ratio of 1:12.00, at the conversion price then in effect, upon the earlier occurrence of following events:

(i) 1 (One) day prior to the expiry of 20 (Twenty) years from the date of their issuance; or

(ii) In connection with an IPO, prior to the filing of a red herring prospectus by the Company with the
competent authority or such later date as may be permitted under law.

Refer note 16(i)(c) for further details.

Rights attached to preference share holders (before their conversion on November 12, 2025)

(a) The holder of preference shares are entitled to cumulative dividend of 0.0001%. In addition, the holder
of preference shares carry preferential rights as to dividend over equity shareholders. The holders
of preference shares are entitled to one vote per share on as-if converted basis. In the event of
liquidation, the preference shareholders have preferential rights over equity shareholders to be repaid
to the extent of capital paid up and dividend in arrears on such shares.

(b) Exit Clause - As per the shareholders agreement with the CCCPS holders, the Company and the
Promoters shall provide exit by way of IPO or sale to another person within the exit period.

If within the Exit Period, the Company does not or is unable to, for any reason, provide an exit to
the Investors and the Additional Investors in accordance with Clause 7.1, then the Qualified Investor
Majority shall, under clause 7.8 of the SHA, by jointly issuing a written notice (“Exit Notice”) to the
Company and the Promoters at any time subsequent to the expiry of the Exit Period, have the right
to require the Company to provide an exit on a best-efforts basis by a sale of their Equity Securities
to any Person (including a Competitor) (“Private Transfer Sale”) in accordance with applicable laws.
Upon receipt of an Exit Notice, the Company and Promoters may, on a best efforts basis provide an
exit to the Investors and the Additional Investor in the manner provided in this Clause 7.8 at the Exit
Price, within: (I) 180 (One Hundred Eighty) days from the date of the Exit Notice; or (II) the expiry of 1
(One) year from the Exit Period, whichever is later (“Extended Exit Period”). Accordingly, management
accounted for the aforementioned CCCPS as equity instrument as on March 31, 2025.

(c) Dividend Right - Each compulsory convertible cumulative preference share will entitle the holder
thereof to receive out of funds legally available cumulative cash dividends, if and when declared at
the rate of 0.0001% per annum of initial purchase price (as appropriately adjusted for any bonus share,
share split, reclassification or similar event affecting the compulsory convertible cumulative preference
shares). The Board of Directors may fix a record date for the determination of holders of compulsory
convertible cumulative preference shares entitled to receive payment of a divided declared thereon,
which record date will be not more than sixty days prior to the date fixed for payment thereof.

During the year ended March 31, 2021, the Shareholders had approved bonus issue in the ratio of 100:1.
The Company had allotted 16,435,000 shares as fully paid up bonus shares on February 20, 2021 by utilising
securities premium account amounting to ' 16.44 Million. The bonus shares shall rank pari passu in all respects
and carry the same rights as the existing shareholders. During the financial year ended March 31, 2021, the
Shareholders had approved bonus issue in the ratio of 100:1. The Company had allotted 1,00,10,000 equity
shares as fully paid up bonus shares on February 20, 2021 by utilising securities premium account amounting
to ' 100 Lakhs. The bonus shares shall rank pari passu in all respects and carry the same rights as the
existing shareholders.

(vQ The Company had issued shares for consideration other than cash during the last five years by way of stock
split as per the below table:

The Board of Directors at their meeting held on December 15, 2020 approved the sub-division of each equity
share of face value of ' 10 each fully paid up into ' 1 equity share each. The same was approved by the
shareholders on December 03, 2020. The effective date of sub-division was December 16, 2020.

(vii) The Company has not done any buyback of shares in any of the preceding five years.

Nature and purpose of reserves:

Retained earnings

Retained earnings are the profits/ (losses) that the Company has earned/ incurred till date, less any transfers to
other reserves, dividends or other distributions paid to shareholders. Retained earnings includes remeasurement
(gain)/ loss on defined benefit plans, net of taxes that will not be reclassified to statement of profit and loss.
Retained earnings is a free reserve available to the Company and eligible for distribution to shareholders, in case
where it is having positive balance representing net earnings till date.

Securities premium

Securities premium represents the premium on issue of shares. The reserves can be utilised only for limited
purpose such as issue of bonus shares, utilisation towards the share issue expenses etc. in accordance with the
provisions of the Act.

Share based payment reserve

Share based payment reserve is used to record the fair value of equity-settled share based payment transactions
with employees. The amounts recorded in this account are transferred to securities premium upon exercise of
stock options by employees.

The incremental borrowing rate ranging between 9.25% to 10.50% p.a. (March 31, 2025: 10.55% p.a.) has been
applied to lease liabilities in the Balance sheet.

The Company has entered into various lease arrangements relating to office premises, manufacturing plants,
warehouses and retail stores. These lease contracts of office premises, manufacturing plants, warehouses and
retail stores have lease terms ranging from 2 to 20 years. The Company also has certain leases of buildings
(temporary spaces) with lease terms of 12 months or less. The Company has elected to apply the recognition
exemption for leases with a lease term (or remaining lease term) of twelve months or less. Payments associated
with short-term leases and low-value assets are recognised on a straight-line basis as an expense in the
statement of profit and loss over the lease term.

35 CORPORATE SOCIAL RESPONSIBILITY

Pursuant to the requirement of Section 135 of the Companies Act, 2013, a Corporate Social Responsibility
(‘CSR') committee has been formed by the Company. The Company is not required to spend towards CSR
activities during year ended March 31, 2026 and year ended March 31, 2025 due to lossess during the last three
immediately preceding financial years.

36 CAPITAL MANAGEMENT

For the purpose of Company's capital management, capital includes issued capital (equity and preference),
securities premium, all other equity reserves. The primary objective of the Company's capital management is to
safeguard the Company's ability to continue as a going concern in order to finance the sustained growth in the
business and to protect the shareholders' value.

The Company is predominantly equity financed, which is evident from the capital structure below. The Company
determines the capital requirement based on annual operating plans and long-term and other strategic
investment plans. The funding requirements are met through equity and operating cash flows generated.
The Company is not subject to any externally imposed capital requirements.

Fair value hierarchy

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

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

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments
by valuation techniques :

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - 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).

Level 3 - Inputs for the assets and liabilities that are not based on observable market data (unobservable inputs).
There have been no transfers between Level 1 and Level 2 during the year.

The carrying value of Non-current financial assets and liabilities in the financial statements are carried at
amortised cost to achieve a constant effective rate of interest over their respective lives.

38 FINANCIAL RISK MANAGEMENT

The Company is exposed to various financial risks majorly Credit risk, Liquidity risk, Interest rate risk and Market
risk. The Company's Board of Directors has overall responsibility for the establishment and oversight of the risk
management framework. The Board of directors review and agree policies for managing each of these risks,
which are summarised below:

(i) Credit risk:

a) Trade receivables

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer
contract, leading to a financial loss. The Company's credit risk with regards to receivables is reduced by its
business model which allows it to have immediate cash collection. The Company predominantly deals with
market places and online payment partners and these are short term and carry very low credit risk at the
reporting date. The Company does not have significant risk exposure to any single counter party.

As per Ind AS 109, the Company uses the expected credit loss model to assess the impairment loss.
In determining the impairment allowance (allowance for expected credit loss), the Company has used
a practical expedient by computing the expected credit loss allowance for trade receivables based on
a provision matrix. The provision matrix takes into account historical credit loss experience as well as
the current economic conditions and is adjusted for forward looking information. The expected credit
loss allowance is based on the ageing of the receivables that are due and allowance rates used in the
provision matrix.

Outstanding trade receivables are regularly and closely monitored basis the historical trend. The Company
provides for any outstanding receivables beyond 365 days which are doubtful. The Company recognises
loss allowance for expected credit loss on trade receivables measured at amortised cost. Refer note 11 for
the details on allowances for expected credit loss on trade receivables.

b) Investments in mutual funds and fixed deposits

Credit risk from balances with banks is managed by the Company's treasury team. Investments of surplus
funds are made primarily in mutual fund units and fixed deposits. Basis its assessment, the Company has
not identified any expected credit loss on the mutual funds and fixed deposits.

c) Other financial assets

With respect to other financial assets including security deposits, the Company has not identified any
default in recovery of amounts basis the assessment of credit risk other than those specifically identified
and provided for. Hence, the Company has no significant class of financial assets that is past due
but not impaired.

(ii) Liquidity risk:

Liquidity risk is the risk of being unable to meet the payment obligations resulting from financial liabilities which
may arise from unavailability of funds. The Company's financial planning has ensured, as far as possible, that
there is sufficient liquidity to meet the liabilities whenever due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Company's reputation. The Company believes
that cash and cash equivalents, other bank balances, bank deposits and current investments are sufficient to
meet its current requirements, accordingly, no liquidity risk is perceived. The Company regularly monitors the
rolling forecasts to ensure it has sufficient cash on an on-going basis to meet operational needs. Any short-term
surplus cash generated, over and above the amount required for working capital management and other
operational requirements, is retained as cash and cash equivalents (to the extent required) and any excess is
invested in interest bearing term deposits with appropriate maturities and in mutual funds to optimise the cash
returns on investments while ensuring sufficient liquidity to meet its liabilities.

The table below summarises the maturity profile of the Company's financial liabilities at the reporting date.
The amounts are based on contractual undiscounted payments:

(iii) Market risk:

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market prices. Such changes in the values of financial instruments may result from changes in the
foreign currency exchange rates, interest rates, credit, liquidity and other market changes.

a) Currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate due
to changes in foreign exchange rates. The functional currency of the Company is Indian Rupees and
its revenue is generated predominantly from operations in India. The Company does not enter into any
derivative instruments for trading or speculative purposes.

b) Price risk:

The Company invests surplus funds in liquid mutual funds. The Company is exposed to market price risk
arising from uncertainties about future values of the investment. The Company manages the equity price
risk through investing surplus funds on liquid mutual funds for short term basis.

The table below summarises the impact of increase/decrease of the Net Asset Value (NAV) on the profit/
(loss) for the year. The analysis is based on the assumption that the NAV would increase 5% and decrease
by 5% with all variable constant:

The Company is involved in various indirect tax litigations under the Goods and Services Tax (GST) laws,

relating to excess availment and ineligibility of input tax credits, along with applicable interest and penalties.

These matters are currently under dispute before various judicial and appellate forums.

Based on management's assessment, supported by legal advice, it is not considered probable that an outflow

of resources embodying economic benefits will be required to settle these obligations.

Notes

(i) Contingent liabilities disclosed above represent possible obligations where possibility of cash outflow to
settle the obligations is not remote.

(ii) Pending resolution of the proceedings, it is not practicable for the Company to estimate the timings of
cash outflows, if any, in respect of the above as it is determinable only on receipt of judgements/decisions
pending with relevant forum/authority.

(iii) The Company doesn't expect any reimbursements in respect of the above contingent liabilities.

41 SHARE BASED PAYMENTS

The Company provides share-based payment scheme to its employees which is equity settled in nature.
The Wakefit Employee Stock Option Plan 2019 (ESOP 2019) was approved by the Board of Directors of the
Company at their meeting held on April 19, 2019 and in the Shareholders meeting held on May 21, 2019
respectively. The Nomination and Remuneration committee of the Board of Directors shall, at its sole and
absolute discretion and based on various criteria, determine the employees who are eligible for the options
under this Plan and the terms and conditions thereof. According to the scheme, the employees will be entitled
to options, subject to satisfaction of the prescribed vesting conditions. The options granted under the ESOP
2019 has a vesting period in the range of one to four years from the date of grant of options. The optionee shall
be entitled to exercise the vested options by giving a written notice, or in the case of a liquidation event or no
later than 30 days after the expiry of a period of 10 years from the vesting date or as and when decided by the
board of directors of the Company, whichever is earlier. Pursuant to the 1:11 bonus issue approved by the Board
on May 13, 2025, the Company increased the final ESOP pool to 12,806,928 options.

The Board of Directors in their meeting held on June 16, 2025 and the shareholders, in the Extraordinary General
Meeting of the Company held on June 17, 2025, approved the variation of the terms of ESOP 2019 to align with
the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations,
2021, and to increase the ESOP pool.

The expected life of the stock is based on historical data and current expectations and is not necessarily
indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical
volatility over a period similar to the life of the stock options is indicative of future trends, which may also not
necessarily be the actual outcome.

Note 1: Weighted average remaining contractual life for the stock options outstanding as at March 31, 2026 is
2.31 years (March 31, 2025 is 6.63 years).

Note 2: Fair value of options granted ranges from ' 50.57 to ' 163.22 (based on increase in number of shares/
options due to issue of bonus shares to equity shareholders.)

42 OPERATING SEGMENTS

The CEO (Chief executive officer) of the Company has been identified as the Chief Operating Decision Maker
(CODM) as defined by Indian Accounting Standard (Ind AS) 108 ‘Operating Segments'.

The CODM of the Company evaluates the Company's performance at an overall level as one segment which is
‘Home Furnishing'. Accordingly, the figures appearing in these financial statements relate to the Company's
only reportable segment. The Company has significant operations based in India. Hence, there are no reportable
geographical segments in the financial statements.

43 EMPLOYEE BENEFIT PLANS

(i) Defined contribution plan

The Company makes contributions, determined as a specified percentage of employee salaries in respect of
qualifying employees towards provident fund and employee state insurance fund which is a defined contribution
plan. The Company has no obligations other than to make the specified contributions. The Company's
contribution is recognised as an expense in the statement of profit and loss during the period in which the
employee renders the related services.

The Company has recognised ' 55.26 Million (March 31, 2025: 52.28 Million) in the statement of profit and loss
towards provident fund contribution and employee state insurance fund which are included in contribution to
provident and other funds under the head employee benefits expense.

(ii) Defined benefit plans - Gratuity

The Company operates post-employment defined benefit plan that provides gratuity. Every employee who has
completed five years or more of service is eligible for gratuity on separation, worked out at one-half month's
salary (last drawn salary) for each completed year of service. The Company does not have any plan assets.

The defined benefit plan exposes the Company to actuarial risks such as longevity risk and interest rate risk.

The following table shows a reconciliation from the opening balances to the closing balances for the net defined
benefit liability and its components:

Note: As at March 31, 2025, the Company had carry forward business losses and unabsorbed depreciation of
' 3,134.00 Million. In the absence of convincing evidence regarding the availability of sufficient future taxable
profits, no deferred tax asset was recognised till March 31, 2025.

During the quarter and year ended March 31, 2026, the Company has reassessed the recoverability of these carry
forward losses and unabsorbed depreciation. The reassessment considered, inter alia, taxable profits during
the current year, future projected taxable profits and the use of IPO proceeds towards strategic initiatives,
including planned investments towards expansion of the retail network etc.

Based on the above factors, the Company has recognised a deferred tax asset (net) of ' 1,034.40 Million as
at March 31, 2026, with a corresponding deferred tax credit of ' 980.71 Million recognised in the Statement
of Profit and Loss, ' 57.44 Million recognised in Other Equity and a charge of ' 3.75 Million recognised in Other
Comprehensive Income.

47 ADDITIONAL REGULATORY INFORMATION REQUIRED BY SCHEDULE III

(i) The Company does not have any Benami property, where any proceeding has been initiated or pending
against the Company for holding any benami property.

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

(iii) The Company has not traded or invested in crypto currency or virtual currency.

(iv) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), ncluding
foreign entities (Intermediaries) with the understanding that 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.

(v) 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 writing 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.

(vi) The Company does not 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 or any other relevant provisions of the Income Tax Act, 1961).

(vii) The Company has not been declared wilful defaulter by any bank or financial institution or government or
any government authority.

(viii) The restriction on number of layers prescribed under the Companies Act, 2013 read with the Companies
(Restriction on number of Layers) Rules, 2017 is not applicable to the Company.

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

(x) The Company has not revalued any of its property, plant and equipment (including right-of-use Assets) or
intangible assets or both during the current or previous year.

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

(xii) The Company has borrowings from banks and financial institutions on the basis of security of current
assets. Refer note 46 for reconciliation of quarterly returns or statements filed by the Company with banks
and financial institutions.

48 On November 21, 2025, the Government of India notified four Labour Codes—namely, 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—thereby consolidating 29 existing labour laws.

Based on its assessment of the potential impact of these codes, primarily arising from changes in the
definition of wages, and considering the latest available information, including the revised wage structure being
implemented, the Company has recognised an incremental impact on employee benefit obligations (gratuity
and compensated absences) aggregating to Rs. “& PL!H31& ” Million in the financial statements for the year
ended March 31, 2026. The Company continues to monitor the updates on Central/ State Rules, as well as
clarifications from the Government on various aspects of the Labour Codes. The accounting impact of such
developments will be recognised appropriately as and when they arise.

Considering that the impact is regulatory driven and non-recurring in nature, the Company has presented
the incremental impact under ‘Exceptional items' in the Statement of Profit and Loss for the year ended
March 31, 2026.

49 During the year ended March 31, 2026, the Company has completed an Initial Public Offer (IPO) of 66,096,866
equity shares of face value of ' 1 each at an issue price of ' 195 per equity share (including share premium of
' 194 per equity share), comprising of offer for sale of 46,754,405 equity shares by selling shareholders and
fresh issue of 19,342,461 equity shares. Pursuant to the IPO, the equity shares of the Company were listed on
National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on December 15, 2025.

The total proceeds on account of fresh issue were '. 3,491.96 Millions (net of issue expenses of ' 279.82 Million).
The utilization of the net IPO proceeds is summarized below: