u) Provisions, Contingent Liabilities and Contingent
Assets

Provisions are recognized for liabilities that can
be measured only by using a substantial degree of
estimation, if

(a) the Company has a present obligation as a result
of a past event;

(b) a probable outflow of resources is expected to
settle the obligation; and

(c) the amount of the obligation can be reliably
estimated.

Reimbursement expected in respect of expenditure
required to settle a provision is recognised only when
it is virtually certain that the reimbursement will be
received.

Contingent liability is disclosed in case of

(a) a present obligation arising from past events,
when it is not probable that an outflow of
resources will be required to settle the obligation;

(b) a present obligation when no reliable estimate is
possible; and

(c) a possible obligation arising from past events
where the probability of outflow of resources is
not remote.

Contingent Assets are neither recognised, nor
disclosed.

Provision, Contingent Liabilities and Contingent
Assets are reviewed at each balance Sheet date.

v) Dividend

The Company recognises a liability to make 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 Companies
Act,2013 in India, a distribution is authorised when
it is approved by the shareholders. A corresponding
amount is recognised directly in equity.

w) Segment Reporting

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

1.3 Key accounting estimates and judgements

The preparation of the Company’s financial
statements requires the 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.

The areas involving critical estimates or judgements
are:

a. Property Plant & Equipment - Property, plant and
equipment represent a significant proportion of
the asset base of the Company. The charge in
respect of periodic depreciation is derived after
determining an estimate of an asset’s expected
useful life and the expected residual value at
the end of its life. The useful lives and residual
values of Company’s assets are determined by
management at the time the asset is acquired
and reviewed at the end of each reporting period.
The lives are based on historical experience with
similar assets as well as anticipation of future
events, which may impact their life, such as
changes in technology.

b. Provisions - Provision is recognised when the
Company has a present obligation as a result of
past event and it is probable that an outflow of
resources will be required to settle the obligation,
in respect of which a reliable estimate can be
made. These are reviewed at each balance
sheet date adjusted to reflect the current best
estimates.

c. Taxes - Significant judgements are involved in
determining the provision for income taxes,
including amount expected to be paid / recovered
for uncertain tax positions. In assessing the
realizability of deferred tax assets arising from
unused tax credits, the management considers
convincing evidence about availability of
sufficient taxable income against which such
unused tax credits can be utilized. The amount
of the deferred income tax assets considered
realizable, however, could change if estimates of
future taxable income changes in the future

d. Defined Benefit Obligations - The cost of defined
benefit gratuity plans, and post-retirement
medical benefit is determined using actuarial
valuations. The actuarial valuation involves
making assumptions about discount rates,
future salary increases, mortality rates and
future pension increases. Due to the long-

term nature of these plans, such estimates are
subject to significant uncertainty

1.4 Recent Accounting Pronouncements

i. The Company has applied the following
amendments for the first time for their annual
reporting period commencing April 1,2024 :

Ministry of Corporate Affairs (“MCA”) notifies
new standards or amendments to the existing
standards under Companies (Indian Accounting
Standards) Rules as issued from time to time.
During the year ended March 31,2025, MCA has
notified Ind AS 117 - Insurance Contracts and
amendments to Ind As 116 - Leases , relating
to sale and lease back transactions, applicable
from April 1, 2024. The Company has assessed
that there is no significant impact on its financial
statements”

ii. New Standards/Amendments notified but not
yet effective:

Ind AS 21- Effects of Changes in Foreign Exchange

These amendments aim to provide clearer
guidance on assessing currency exchangeability
and estimating exchange rates when currencies
are not readily exchangeable. The amendments
are effective for annual periods beginning on or
after April 1, 2025.

32 c Corporate Social Responsibility

In accordance with the provisions of Section 135 of the Companies Act, 2013, the applicability of Corporate Social Responsibility (CSR)
is determined based on the financial thresholds prescribed therein. For the financial years 2023-24 and 2024-25, the Company does
not meet the criteria specified under Section 135 and, accordingly, the constitution of a CSR Committee and related disclosures are not
applicable. Further, pursuant to the Composite Scheme of Arrangement involving the merger of Chembond Clean Water Technologies
Limited and the demerger of the CC & WT Business Undertaking of Chembond Chemicals Limited into the Company, the financials of
the current and preceding financial years include the effect of the said Scheme, accounted for using the pooling of interest method
which has inclusion of CSR expenditure incurred by CCWTL.

35 SEGMENT REPORTING

The Company is engaged in the manufacture, trading and providing services of Specialty Chemical products, which, in the
context of Ind AS 108 - Operating Segments, specified under Section 133 of the Companies Act, 2013, is considered as a
single business segment of the Company.

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision
Maker.

The Board of Directors of the Company has been identified as the Chief Operating Decision Maker, which reviews and
assesses the financial performance and makes strategic decisions.

Revenue from a single external customer is not in excess of 10% of the total revenue for the year.

B. Measurement of fair values

Ind AS 107, ‘Financial Instrument - Disclosure’ requires classification of the valuation method of financial instruments
measured at fair value in the Balance Sheet, using a three level fair-value-hierarchy (which reflects the significance of inputs
used in the measurements). The hierarchy gives the highest priority to un-adjusted quoted prices in active markets for
identical assets or liabilities (Level 1 measurements) and lowest priority to un-observable inputs (Level 3 measurements).
Fair value of derivative financial assets and liabilities are estimated by discounting expected future contractual cash flows
using prevailing market interest rate curves. The three levels of the fair-value-hierarchy under Ind AS 113 are described
below:

Level 1: Heirarchy includes financial instruments measured using quoted prices.

Level 2: The fair value of financial instruments that are not traded in an active market are determined using valuation
techniques which maximise the use of observable market data and rely as little as possible on entity specific estimates. If
all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs are not based on observable market data, the instrument is included in level
3. e.g. unlisted equity securities.

Transfers between Levels

There are no transfers betweeen the levels

C. Financial risk management

The Company’s activities expose it to Credit risk, liquidity risk and market risk.

i. Risk management framework

Risk Management is an integral part of the Company’s plans and operations. The Company’s board of directors has
overall responsibility for the establishment and oversight of the Company risk management framework. The board of
directors is responsible for developing and monitoring the Company risk management policies.

The Risk Management committee oversees how management monitors compliance with the Company’s risk
management policies and procedures, and reviews the adequacy of the risk management framework in relation to
the risks faced by the Company. The audit committee is assisted in its oversight role by internal audit. Internal audit
undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are
reported to the audit committee.

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 and
investments in debt securities, cash and cash equivalents, mutual funds, bonds etc.

The carrying amount of financial assets represents the maximum credit exposure.

Trade and other receivables

Credit risk is the risk of possible default by the counter party resulting in a financial loss.

The Company manages credit risk through various internal policies and procedures setforth for effective control over
credit exposure. These are managed by way of setting various credit approvals,evaluation of financial condition before
supply terms, setting credit limits, industry trends,ageing analysis and continuously monitoring the creditworthiness
of customers to which the Company grants credit terms in the normal course of business.

Based on prior experience and an assessment of the current economic environment, management believes that
sufficient provision is made based on expected credit loss model for credit risk wherever credit is extended to
customers.

Cash and cash equivalents

Credit risk from balances with banks is managed by the Company’s treasury department in accordance with the
Company’s policy. Investment of surplus funds are made in mainly in mutual funds with good returns and with high
credit ratings assigned by International and domestic credit ratings agencies.

Other than trade and other receivables, the Company has no other financial assets that are past due but not impaired.

iii. Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The
Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet
its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to
the Company’s reputation.

iv. Market risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes
in market rates and prices (such as interest rates, foreign currency exchange rates). Market risk is attributable to all
market risk-sensitive financial instruments, all foreign currency receivables and payables and all short term and long¬
term debt. The Company is exposed to market risk primarily related to foreign exchange rate risk, interest rate risk
and the market value of its investments. Thus, the Company’s exposure to market risk is a function of investing and
borrowing activities and revenue generating and operating activities in foreign currencies.

a) Currency risk

The Compnay is exposed to currency risk to the extent that there is a mismatch between the currencies in
which sales, purchase, and other expenses are denominated and the functional currency of the Company. The
functional currency of the Company is Indian Rupees (INR). The currencies in which these transactions are
primarily denominated USD.

b) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because
of changes in market interest rates. Investment committee manages and constantly reviews the interest rate
movements in the market. This risk is mitigated by the Company by investing the funds in varioustenors depending
on the liquidity needs of the Company. The Company’s exposures to interest rate risk is not significant.

37 Employee Benefit obligations

(A) Defined Contribution Plan

Contributions are made to Employee Provident Fund (EPF), Employees State Insurance Scheme (ESIC) and other
Funds which covers all regular employees. Both the employees and the Company make predetermined contributions
to the Provident Fund and ESIC. The contributions are normally based on a certain percentage of the employee’s
salary. Amount recognised as expense in respect of these defined contribution plans, is as detailed below :

43 Additional regulatory information not disclosed elsewhere in the financial information

A The Company do not have any Benami property and no proceedings have been initiated or pending against the
Company and its Indian

subsidiaries for holding any Benami property, under the Benami Transactions (Prohibitions) Act, 1988 (45 of 1988) and
the rules made thereunder.

B The Company has no transactions with struck off companies under section 248 of the Companies Act, 2013 or section
560 of the Companies Act, 1956.

C The Company have not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign
entities (Intermediaries) with the understanding that the

Intermediary shall:

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

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

D The Company have 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 Group shall:

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

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

E The Company have not undertaken 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).

F The Company have not traded or invested in Crypto currency or Virtual Currency during the current or previous year.

G The Company have not been declared as a ‘Wilful Defaulter’ by any bank or financial institution (as defined under the

Companies Act, 2013) or consortium thereof, in

accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India.

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

44 Capital Management

For the purpose of the Company’s capital management, capital includes issued capital and all other equity reserves
attributable to the equity shareholders of the Company. The primary objective of the Company when managing capital
is to safeguard its ability to continue as a going concern and to maintain an optimal capital structure so as to maximize
shareholder value.

As at 31st March, 2025, the Company has only one class of equity shares and has no other long term borrowings. Consequent
to such capital structure, there are no externally imposed capital requirements. In order to maintain or achieve an optimal
capital structure, the Company allocates its capital for distribution as dividend or re-investment into business based on its
long term financial plans.

47 Working Capital Facilities

Details of credit facilities from banks:

The Company has sanctioned credit facilities from Bank of India 150 lakhs (i.e cash credit facility - 100.00 lakhs and Bank
Guarantee - 50.00 lakhs) The Company has not utilised cash credit facilities at the year end.

Terms of loan

a) The credit facility carries interest rate of Bank Of India, currently 9.81% p.a. (interest payable on monthly rests).

b) The credit facility is secured by : Hypothecation of stocks and bookdebts.

Utilisation of borrowings :

(a) The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was
taken at the balance sheet date.

(b) The quarterly returns/statements of current assets filed by the Company with banks or financial institutions in relation
to secured borrowings wherever applicable, are in agreement with the books of accounts.

48 Audit Trail

The Ministry of Corporate Affairs (MCA) has issued a notification - Companies (Accounts) Amendment Rules, 2021 which
is effective from 1st April, 2023. The amendment requires that every company which uses an accounting software for
maintaining its books of account shall use an accounting software where there is feature of recording audit trail of each and
every transaction and further creating an edit log of each change made to the books of account along with the date when
such changes were made and ensuring that the audit trail cannot be disabled.

The Company uses an accounting software for maintaining books of account which has a feature of recording audit trail
and edit log facility and that has been operative throughout the financial year for the transactions recorded in the software
impacting books of account at the application level. The software being managed on public cloud, users do not have access
to enable, disable, deactivate or tamper with the audit trail setting.

The Company also uses software for payroll application and employee reimbursement. In both the software there is a
feature of audit log for recording audit trail and the same cannot be disabled or modified.

The audit trail feature is not enabled at the database level in respect of these software.

49 Events occurring After Balance sheet date

The Company evaluates events and transactions that occur subsequent to the balance sheet date but prior to approval of
the financial statements to determine the necessity for recognition and / or reporting of any of these events and transactions
in the financial statements. Pursuant to the Composite Scheme of Arrangement approved by the Hon’ble NCLT on April 7,
2025 Further the Company has filed the certified copy of the said order with the Registrar of Companies on 3rd May 2025.
These events, occurring after the reporting date but before the approval of the financial statements, have been Adjustred
and Disclosed in accordance with Ind AS 110.

50 Accouting Treatment as per IND AS 103 - Business Combination

Pursuant to the Composite Scheme of Arrangement the following transactions related to CCSL were effected:

Demerger of (WT) and (CC (Undertaking of CCL and transfered to CCSL

The Water Technologies (WT) and Construction Chemicals (CC) business undertaking of Chembond Material Technologies
Limited (“the Demerged Company” formarly known as Chembond Chemicals Limited) was demerged and transferred to
Chembond Chemical Specialties Limited (“CCSL” or “the Resulting Company”) with effect from the Appointed Date, i.e.,
1st April 2024.

Amalgatmation of CCWTL with CCSL

Subsequently, Chembond Clean Water Technologies Limited (CCWTL) was amalgamated with CCSL as part of the same
Scheme.

The above transactions has been accounted for as a common control business combination in accordance with Appendix
C of Ind AS 103 - Business Combinations, using the pooling of interest method. Accordingly:

(a) The assets, liabilities, and reserves of the CC&WT Business of CCL and of CCWTL have been transferred to and vested
in CCSL at their respective carrying values.

(b) The standalone financial statements for the year ended 31st March 2025 includes the merged financial figures of the
CC&WT Business and CCWTL for the relevant period as per the method of accounting prescribed in the Scheme and
in accordance with principles of Indian Accounting Standards, including IND AS 103 (Business Combinations).

(c) The comparative figures for the year ended 31st March 2024, have been restated to include the corresponding
financial results of the CC&WT Business and CCWTL for those periods, to ensure comparability.

51 Composite scheme of arrangement:

Chembond Chemicals Limited (Demerged Company / CCL), Chembond Chemical Specialties Limited (“Resulting
Company”/ CCSL / Company), Chembond Clean Water Technologies Limited (CCWTL), Chembond Material Technologies
Private Limited (CMTPL), Phiroze Sethna Private Limited (PSPL) and Gramos Chemicals India Private Limited (GCIPL) and
their respective shareholders have entered into a Composite Scheme of Arrangement under Section 230 to 232 of the
Companies Act, 2013 (“Scheme”) which contemplates Amalgamation of CMTPL, PSPL and GCIPL with CCL, demerger of
“Construction Chemicals and Water Technologies chemicals” business from CCL to CCSL and amalgamation of CCWTL
into CCSL, as on the Appointed Date of 1st April, 2024. The said Scheme was approved by the National Company Law
Tribunal, Mumbai Bench (“NCLT”) on 7th April, 2025 and the Company has received the certified order copy on 22nd April
2025. The Company has filed the certified copy of the said order with the Registrar of Companies for CCL, CCSL, CMTPL,
PSPL, GCIPL and CCWTL on 29/04/2025, 30/04/2025, 01/05/2025, 01/05/2025, 02/05/2025 and 03/05/2025 respectively,
as such the Scheme has become effective from the respective dates for all the companies involved in the Scheme.

Upon demerger, the Resulting Company is required to issue its equity shares to each shareholder of the Demerged Company
as on record date in 1:2 swap ratio (i.e., for every 1 equity share held in Demerged Company, two shares of ' 5/- each
will be issued by the Resulting Company). The said allotment of 2,68,96,576 shares has been approved by the Allotment
Committee of CCSL on 13/05/2025 and the equity shares were allotted to the shareholders in the said ratio.

52 The company has evaluated the option permitted under section 115BAA of the Income Tax Act, 1961 (the “Act”) as
introduced by the Taxation Laws (Amendment) Ordinance, 2019. Accordingly, the Company has presently decided to opt
for tax structure prescribed under Section 115BAA of the Income Tax Act, 1961 in current year.

53 The previous year figures have been regrouped, reallocated or reclassified wherever necessary to conform to current year
classification and presentation.

As per our attached report of even date

F_0r S H B A & CO LLP On behalf of the Board of Directors

(Formerly known as Bathiya & Associates LLP)

C^har^tered A^ccou^ntants Nirmal V. Shah Sameer V. Shah

FRN - 101046W/W100063 Director Director

DIN:00083853 DIN:00105721

Jatin A. Thakkar Prachi Mahadik Kiran Mukadam

Partner Chief Financial Officer Company Secretary

Membership No. : 134767