(k) Provisions and Contingencies
Provisions

A provision is recognised when the Company has a present obligation (legal or constructive) as a result of 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.The amount recognised as provision are determined
based on best estimate of the amount required to settle the obligation at the balance sheet date. These estimates are
reviewed at each reporting date and adjusted to reflect the current best estimates.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects,
when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the
passage of time is recognised as a finance cost.

A provision for onerous contracts is recognized when the expected benefits to be derived by the Company from a
contract are lower than the unavoidable cost of meeting its obligations under the contract. The provision is measured
at the present value of the lower of the expected cost of terminating the contract and the expected net cost of
continuing with the contract. Before a provision is established, the Company recognizes any impairment loss on the
assets associated with that contract.

Contingent Liabilities & Contingent Assets

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 recognised 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 recognised
because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its
existence in the financial statements.

Contingent assets are not recognized in the financial statements. If the inflow of economic benefits is probable, then
it is disclosed in the financial statements.

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

(l) Employee Benefits

(i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within
12 months after the end of the period in which the employees render the related service are recognised in respect
of employees' services up to the end of the reporting period and are measured at the amounts expected to be
paid when the liabilities are settled.

(ii) Other long-term employee benefit obligations

The liabilities for compensated absences that are not expected to be settled wholly within 12 months are measured
as the present value of expected future payments to be made in respect of services provided by employees up to
the end of the reporting period using the projected unit credit method. Remeasurements as a result of experience
adjustments and changes in actuarial assumptions are recognised in the Statement of Profit and Loss.

The obligations are presented as current liabilities in the balance sheet if the entity does not have any unconditional
right to defer settlement for at least 12 months after the end of the reporting period, regardless of when the actual
settlement is expected to occur.

(iii) Post-employment obligations

The Company operates the following post-employment schemes:

(a) defined benefit plans such as gratuity and

(b) defined contribution plans such as superannuation scheme, provident fund.

Gratuity Obligations

The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the present
value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The
defined benefit obligation is calculated annually by actuaries using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash
outflows by reference to market yields at the end of the reporting period on government bonds that have terms
approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation
and the fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and
Loss.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions
are recognised in the period in which they occur, directly in other comprehensive income.

Defined Contribution plans

Defined Contribution Plans such as superannuation scheme, provident fund are charged to the statement of
profit and loss as an expense, when an employee renders the related services. If the contribution payable to
scheme for service received before the balance sheet date exceeds the contribution already paid, the deficit
payable to the scheme is recognised as 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
recognised as an asset.

(m) Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker. The chief operational decision maker monitors the operating results of its business Segments
separately for the purpose of making decision about the resources allocation and performance assessment. Segment
performance is evaluated based on the profit or loss and is measured consistently with profit or loss in the financial
statements. The operating segments have been identified on the basis of the nature of products/ services.

(n) Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand,
demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less
that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(o) Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is
adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts
or payments. The cash flows from operating, investing and financing activities of the Company are segregated based
on the available information.

(p) Earnings Per Share
Basic earnings per share

Basic earnings per share are calculated by dividing:

• the profit attributable to owners of the Company.

• by the weighted average number of equity shares outstanding during the financial year.

Diluted earnings per share

Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take into
account:

• the after income tax effect of interest and other financing costs associated with dilutive potential equity shares,
and

• the weighted average number of additional equity shares that would have been outstanding assuming the
conversion of all dilutive potential equity shares.

(q) Non-current assets held for sale

The Company classifies non-current assets as held for sale if their carrying amounts will be recovered principally
through a sale rather than through continuing use. Such non-current assets classified as held for sale are measured
at the lower of their carrying amount and fair value less costs to sell. Any expected loss is recognised immediately in
the Statement of Profit and Loss.

The criteria for “held for sale” classification is regarded as met only when the sale is highly probable i.e. an active
program to locate a buyer to complete the plan has been initiated and the asset is available for immediate sale in its
present condition and the assets must have actively marketed for sale at a price that is reasonable in relation to its
current fair value. Actions required to complete the sale should indicate that it is unlikely that significant changes to
that plan to sale these assets will be made. Management must be committed to the sale, which should be expected to
qualify for recognition as a completed sale within one year from the date of classification.

Property, plant and equipment and intangible assets once classified as held for sale are not depreciated or amortised.
Assets and liabilities classified as held for sale are presented separately as current items in the balance sheet.

(r) Dividend distribution to equity shareholders

Dividend distributed to Equity shareholders is recognised as distribution to owners of capital in the Statement of
Changes in Equity, in the period in which it is paid.

Final dividend on shares are recorded as a liability on the date of approval by the shareholders and interim dividends
are recorded as a liability on the date of declaration by the Company's Board of Directors.

(s) Foreign currencies

The financial statements are presented in Indian rupee (Rs.), which is Company's functional and presentation currency.

Transactions in foreign currencies are recognised at the prevailing exchange rates on the transaction dates. Realised
gains and losses on settlement of foreign currency transactions are recognised in the statement of profit and loss.

Monetary foreign currency assets and liabilities at the year-end are translated at the year-end exchange rates and the
resultant exchange differences are recognised in the statement of profit and loss.

(t) Revenue Recognition

The Company mainly deals in manufacture of special alloy steel/ stainless steel, billets, bars, rods, wire rods, EOT
cranes, material handling equipment, other industrial machinery, rendering of comprehensive engineering services
and contruction/engineering services.

Revenue is recognized on satisfaction of performance obligation upon transfer of control of promised goods or services
to customers in an amount that reflects the consideration which Company expects to receive in exchange for those
products or services.

Revenue is measured based on the transaction price, which is the consideration, adjusted for volume discounts,
rebates, scheme allowances, price concessions, incentives, and returns, if any, as specified in the contracts with the
customers. Revenue excludes taxes collected from customers on behalf of the government.

Revenue from sale of products and services is recognised at a time when the performance obligation is satisfied
except Revenue from Engineering Contracts where in revenue is recognized over the time from the financial year in
which the agreement to sell (containing salient terms of agreement to sell) is executed. The period over which revenue
is recognised is based on entity's right to payment for performance completed.

In determining whether Company has right to payment, the Company shall consider whether it would have an
enforceable right to demand or retain payment for performance completed to date if the contract were to be terminated
before completion for reasons other than Company's failure to perform as per the terms of the contract.

The revenue recognition of Engineering Contracts under progress requires forecasts to be made of total budgeted
costs with the outcomes of underlying contracts, which further require assessments and judgements to be made on
changes in scope of work and other payments to the extent they are probable and they are capable of being reliably
measured. However, where the total project cost is estimated to exceed total revenues from the project, the loss is
recognized immediately in the Statement of Profit and Loss.

Revenue from Engineering Contracts where the performance obligations are satisfied over time and where there is
no uncertainty as to measurement or collectability of consideration, is recognized as per the percentage of completion
method. When there is uncertainty as to measurement or ultimate collectability, revenue recognition is postponed until
such uncertainty is resolved. Revenues in excess of invoicing are classified as contract assets (which is referred to
as unbilled revenue) while invoicing in excess of revenues are classified as contract liabilities (which is referred to as
unearned revenues). The billing schedules agreed with customers include periodic performance based payments and
/ or milestone based progress payments. Invoices are payable within contractually agreed credit period.

Engineering Contracts are subject to modification to account for changes in contract specification and requirements.
The Company reviews modification to contract in conjunction with the original contract, basis which the transaction
price could be allocated to a new performance obligation or transaction price of an existing obligation could undergo
a change. In the event, transaction price is revised for existing obligation, a cumulative adjustment is accounted for.

The Company satisfies a performance obligation and recognises revenue over time, if one of the following criteria is
met:

1. The customer simultaneously receives and consumes the benefits provided by the Company's performance as
the Company performs; or

2. The Company's performance creates or enhances an asset that the customer controls as the asset is created or
enhanced; or

3. The Company's performance does not create an asset with an alternative use to the Company and Company has
an enforceable right to payment for performance completed to date.

In case of performance obligations, where any of the above conditions is not met, revenue is recognised at the
point in time at which the performance obligation is satisfied.

Export incentives

Export Incentives under various schemes are accounted in the year of export.

Interest Income :

Interest income accrues on a time proportion basis, by reference to the principal outstanding and the effective interest
rate applicable.

Dividend Income:

Dividend income from investments is recognised when the shareholder's right to receive the payment has been
established.

(u) Exceptional Items

Exceptional items are disclosed separately in the financial statements where it is necessary to do so to provide further
understanding of the financial performance of the Company. These are material items of income or expense that have
to be shown separately due to the significance of their nature or amount.

(v) Events after the reporting period

Adjusting events are events that provide further evidence of conditions that existed at the end of the reporting period.
The financial statements are adjusted for such events before authorisation for issue.

Non-adjusting events are events that are indicative of conditions that arose after the end of the reporting period.
Non-adjusting events after the reporting date are not accounted but disclosed.

(w) Significant accounting estimates, judgements and assumptions

The preparation of the Company's financial statements in conformity with Ind AS 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. The estimates and associated assumptions are based on historical experience and various
other factors that are believed to be reasonable under the circumstances existing when the financial statements were
prepared. The estimates and underlying assumptions are reviewed on an ongoing basis. Revision to accounting
estimates is recognised in the year in which the estimates are revised and in any future year affected.

In the process of applying the Company's accounting policies, management has made the following judgements which
have significant effect on the amounts recognised in the financial statements:

i. Useful lives of property, plant and equipment

Determination of the estimated useful life of tangible assets and the assessment as to which components of
the cost may be capitalised. Useful life of tangible assets is based on the life specified in Schedule II of the Act
and also as per management estimate for certain category of assets. Assumption also needs to be made, when
Company assesses, whether an asset may be capitalised and which components of the cost of the assets may
be capitalised.

ii. Use of significant judgements in revenue recognition

• The Company's contracts with customers could include promises to transfer multiple products and services
to a customer. The Company assesses the products / services promised in a contract and identifies distinct
performance obligations in the contract. Identification of distinct performance obligation involves judgement
to determine the deliverables and the ability of the customer to benefit independently from such deliverables.

• The Company exercises judgement in determining whether the performance obligation is satisfied at a
point in time or over a period of time. The Company considers indicators such as how customer consumes
benefits as services are rendered or who controls the asset as it is being created or existence of enforceable
right to payment for performance to date and alternate use of such product or service, transfer of significant
risks and rewards to the customer, acceptance of delivery by the customer, etc.

• Judgement is also required to determine the transaction price for the contract. The transaction price could
be either a fixed amount of customer consideration or variable consideration with elements such as volume
discounts, service level credits, performance bonuses, price concessions and incentives. The transaction
price is also adjusted for the effects of the time value of money if the contract includes a significant financing
component. Any consideration payable to the customer is adjusted to the transaction price, unless it is a
payment for a distinct product or service from the customer.

• Revenue from Engineering Contracts is recognised using percentage-of-completion method. The Company
uses judgement to estimate the future cost-to-completion of the contracts which is used to determine the
degree of completion of the performance obligation.

iii. 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 appropriate valuation techniques.
The inputs for these valuations are taken from observable sources where possible, but where this is not feasible,
a degree of judgement is required in establishing fair values. Judgements include considerations of various
inputs including liquidity risk, credit risk, volatility etc. Changes in assumptions/ judgements about these factors
could affect the reported fair value of financial instruments.

iv. Defined benefit plan

The cost of the defined benefit gratuity plan and other post-employment benefits and the present value of the
gratuity obligation are determined using 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, a defined benefit obligation is highly sensitive to changes in these assumptions. All
assumptions are reviewed at each reporting date.

v. Allowances for uncollected accounts receivables

Trade receivables are stated at their normal value as reduced by appropriate allowances for estimated irrecoverable
amounts. Individual trade receivables are written off when management deems them not collectable. Impairment
is made on the expected credit loss model, which are the present value of the cash shortfall over the expected
life of the financial assets. The impairment provisions for financial assets are based on assumption about the
risk of default and expected loss rates. Judgement in making these assumptions and selecting the inputs to the
impairment calculation are based on past history, existing market condition as well as forward looking estimates
at the end of each reporting period.

vi. Allowance for inventories

Management reviews the inventory age listing on a periodic basis. This review involves comparison of the
carrying value of the aged inventory items with the respective net realizable value. The purpose is to ascertain
whether an allowance is required to be made in the financial statements for any obsolete and slow-moving items.
Management satisfies itself that adequate allowance for obsolete and slow-moving inventories has been made
in the financial statements.

vii. Impairment of non-financial assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If
any indication exists, the Company estimates the asset's recoverable amount. An asset's recoverable amount
is the higher of an asset's or Cash Generating Units (CGU's) fair value less costs of disposal and its value in
use. It is determined for an individual asset, unless the asset does not generate cash inflows that are largely
independent of those from other assets or a group of assets. Where the carrying amount of an asset or CGU
exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the
asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if no
such transactions can be identified, an appropriate valuation model is used.

viii. Contingencies

Management judgement is required for estimating the possible outflow of resources, if any, in respect of
contingencies/claim/litigation against Company as it is not possible to predict the outcome of pending matters
with accuracy.

ix. Leases

The Company determines the lease term as the non-cancellable term of the lease, together with any periods
covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by
an option to terminate the lease, if it is reasonably certain not to be exercised. The Company has several lease
contracts that include extension and termination options. The Company applies judgement in evaluating whether
it is reasonably certain whether or not to exercise the option to renew or terminate the lease. That is, it considers
all relevant factors that create an economic incentive for it to exercise either the renewal or termination. After
the commencement date, the Company reassesses the lease term if there is a significant event or change in
circumstances that is within its control and affects its ability to exercise or not to exercise the option to renew or
to terminate (e.g., construction of significant leasehold improvements or significant customisation to the leased
asset).

x. Provision for income tax and deferred tax assets

The Company's tax jurisdiction is India. Significant judgements are involved in estimating budgeted profits for
the purpose of paying advance tax, determining the provision for income taxes, including amount expected to
be paid/recovered for uncertain tax positions. A deferred tax asset is recognised to the extent that it is probable
that future taxable profit will be available against which the deductible temporary differences and tax losses can
be utilised. Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable
profit will be available against which the losses can be utilised. Significant management judgement is required
to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the
level of future taxable profits together with future tax planning strategies. Accordingly, the Company exercises its
judgement to reassess the carrying amount of deferred tax assets at the end of each reporting period.

(X) Business combination

Business combinations involving entities or businesses under common control are accounted for using the
pooling of interest method. Under pooling of interest method, the assets and liabilities of the combining entities
or businesses are reflected at their carrying amounts after making adjustments necessary to harmonise the
accounting policies. The financial information in the financial statements in respect of prior periods is restated as
if the business combination had occurred from the beginning of the preceding period in the financial statements,
irrespective of the actual date of the combination. The identity of the reserves is preserved in the same form in
which they appeared in the financial statements of the transferor and the difference, if any, between the amount
recorded as share capital issued plus any additional consideration in the form of cash or other assets and the
amount of share capital of the transferor is transferred to capital reserve.

(XI) Recent Indian Accounting Standards (Ind AS) issued

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 leaseback transactions, applicable to the Company/ Group w.e.f. April 1, 2024. The Company/
Group has reviewed the new pronouncements and based on its evaluation has determined that it does not have
any significant impact in its financial statements.

b. Terms / rights attached to equity shares:

The Company has only one class of equity share having a par value of Rs. 10/- per share. Each holder of equity share
is entitled to one vote per share. The Company declares and pays dividend in Indian rupees in accordance with its
dividend distribution policy.

The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual
General Meeting, except in case of interim dividend. The Board of Directors in its meeting held on May 16, 2025
recommended a dividend on equity shares at Rs. 2 per share for financial year 2024-25. During the year ended
31 March 2025, the amount of dividend per share recognized as distribution to equity shareholders was Rs. 2.00
per share as recommended by the Board of Directors in its meeting held on May 15, 2024 and approved by the
Shareholders at its meeting held on August 05, 2024.

The Dividend paid for the previous year and proposed for the current year is in compliance with Section 123 of the Act.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of
the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity
shares held by the shareholders.

c. The Company does not have any holding company.

d. There are no bonus shares issued nor any shares bought back during the period of five years immmediately preceding
the reporting date. During the year ended March 31,2023 3,089,702 equity shares were alloted for consideration other
than cash under the scheme of Amalgamation.

1. Capital Reserve

Capital Reserve is created by the Company on account of Scheme of Arrangement, Refer Note No. 50

2. Capital Redemption Reserve

Capital Redemption Reserve is created by the Company for redemption of preference share from its profits.

3. Securities premium

Securities premium is received from the shareholders of the Company on issue of shares. The reserve is utilised as
per the provisions of the Companies Act, 2013.

4. General Reserves

General Reserves is created out of net profits of the Company by way of appropriation of profits.

5. Retained earnings

Retained Earnings are the balance (debit /credit) in the statement of profit and loss.

b Shareholding of the Promoters in 8% CRPS is as shown above

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

(II) The Board of Directors in its meeting held on May 16, 2025 recommended a dividend at 8% on CRPS for financial
year 2024-25. Since aforesaid CRPS has been classified as financial liability, the amount of dividend has been shown
as finance cost.

During the year ended 31 March 2025, the amount of CRPS dividend recognized as distribution to CRPS holders
was at 8% as recommended by the Board of Directors in its meeting held on May 15, 2024 and approved by the
shareholders at its meeting held on August 05, 2024.

(III) For details of loans received from related parties, refer Note No. 40.

(IV) Unsecured Long Term Committed Loans of Rs.1,400 crores availed from a Bank is repayable in one instalment on
July 14, 2025. The interest rate on these loans is linked to 1 months / 3 months T-Bill Spread. These loans are
backed by guarantee of Rs. 1,750 crores given by Jamnalal Sons Private Limited (JSPL), a promoter group company.

(V) The Company has not defaulted in the payment of interest and installments of the loans as at 31st March 2025.

(VI) The Company has created / modified the charges with the Registrar of Companies within the statutory period except in
the two case where the charge is yet to be satisfied with Registrar of Companies, despite repayment of the underlying
loans. The Company is in the process of filing the charge satisfaction e-form with MCA.

(v) The demand for Annual Bonus for the financial years 1995-96 to 1998-99 raised by Staff and Officers' Association
is pending for final hearing before the High Court, Mumbai under the Industrial Disputes Act, 1947. The majority
of the concerned employees are statutorily not covered under the Payment of Bonus Act, 1965 and are also not
classified as 'Workmen' as defined under the Industrial Disputes Act, 1947. Liability arising there from cannot
therefore be determined at present.

(vi) Government of Maharashtra had served a Demand Notice on the Company for payment of electricity duty for
power generated during the period 01.04.2000 to 30.04.2005 and penal interest thereon in Company's Captive
Power Plant amounting to Rs.14.27 crore. The Writ Petition filed by the Company was disposed by the Hon'ble
Bombay High Court on 7th November, 2009 quashing the said Demand Notice. Government of Maharashtra has
however, filed an appeal in the Supreme Court of India against the aforesaid judgment of High Court.

(vii) A claim towards difference in price of calibrated iron ore for the period 1st April, 2006 to 28th February, 2007
amounting to Rs.33.07 crore has been raised by a supplier in March 2007. The Company has been legally advised
that the supplier cannot seek this price revision under a concluded agreement and hence no provision is made in the
Accounts for the same. The issue along with method of review and re-fixing of price of calibrated iron ore effective
on 1st of April each year in terms of agreement is referred to an arbitral tribunal whose award was pronounced
on 28th February 2014. In terms of the said award, the supplier is directed to re-compute amount payable by the
Company. The supplier has revised the claim amount in December 2020 to Rs. 19.71 Crores. Moreover, the said
supplier has also increased the price of calibrated iron ore w.e.f. 1st April, 2007 and thereafter w.e.f. 1st April,
every year. This issue too was settled by the aforesaid arbitral tribunal. However, pending such determination of
final price, the supplier has raised invoices at an ad-hoc interim mutually agreed price on the marketing contractor
who in turn, has billed the Company at the same price and the liability, has been fully accounted for. An appeal
preferred for challenging the said arbitration award was rejected by the City Civil Court in January 2019. The
marketing contractor has gone in appeal against the decision of the City Civil Court before the High Court of
Karnataka. The appeal is pending disposal.

(d) The Company had, during the Financial Year 1998-99, entered into a strategic alliance with Kalyani Steels
Limited to set-up a steel plant to be operated by a company - Hospet Steels Limited.

Expenses and liabilities arising out of this alliance to Hospet Steels Limited are shared on the basis stipulated
in the relevant Agreements, and its accounting in the books of the Company is carried out, accordingly.
Wherever, due to the terms of the alliance, estimations are required to be made in respect of expenses, liabilities,
production, etc., the same have been relied upon by the auditors, being technical matters.

(40) RELATED PARTY DISCLOSURES

(a) Relationship :

(i) Subsidiaries

Mukand Sumi Metal Processing Limited(MSMPL), Mukand Heavy Engineering Ltd. (MHEL)

(ii) Associate :

Bombay Forgings Ltd. (BFL)

(iii) Joint Venture

Hospet Steels Ltd. (HSL)

(iv) Key Management Personnel

Niraj Bajaj, Prakash Vasantlal Mehta (till 08th August, 2024) , Sankaran Radhakrishnan , Bharti Ram Gandhi
(till 10th February, 2025), Amit Yadav (till 9th November, 2024) , Arvind M Kulkarni, Nirav Bajaj, Prem
Kumar Chandrani (wef 10th September, 2024), Tasneem Mehta (wef 10th February, 2025) & Other KMPs,
Relatives of a Director/ Other KMPs.

(v) Other related parties where significant influence exists or where the related party has significant
influence on the Company:

Kalyani Mukand Ltd., Jamnalal Sons Pvt. Ltd. (JSPL) , Baroda Industries Pvt. Ltd., Sidya Investment Ltd,
Bachhraj & Company Pvt. Ltd ,Bachhraj Factories Pvt. Ltd, Mukand Sumi Special Steel Ltd, Bajaj Sevashram
Pvt. Ltd, Kamalnayan Investment & Trading Pvt Ltd, Rahul Securities Pvt. Ltd, Niraj Holding Pvt. Ltd Madhur
Securities Pvt. Ltd, Shekhar Holding Pvt. Ltd, Malvi Ranchoddas & Co. (upto 8th August,2024), Bajaj Allianz
General Insurance Co Ltd. Hind Musafir Agency Ltd, Bajaj Finserv Ltd., Hindustan Housing Co. Ltd, Other
Promoter group (Refer note 17).

(vi) The Company holds more than 20% in TP Samaksh Limited. However, the Company does not exercise
significant influence or control on decisions of the investees. Hence, it is not being construed as associate
company. This investment is included in “Note 4: Investments” under Investment measured at fair value
through Profit & Loss account in the financial statements.

Defined benefit plans
Compensated Leave

The leave obligations cover the Company's liability for earned leave and sick leave.

The compensated absences charged in the Statement of Profit and Loss for the year ended March 31,2025 based on
actuarial valuation is Rs. 0.03 Crore (previous year Rs. 0.30 crore).

Gratuity

The Company provides for gratuity for employees as per Company's Scheme/s. Employees who are in continuous
service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is
based on the employees last drawn basic salary, special allowance and dearness allowance per month and as per the
Schemes applicable to those employees from time to time. The gratuity plan is a funded plan. The scheme is funded
with Life Insurance Corporation in the form of a qualifying insurance policy.

The actuarial valuation of the defined benefit obligation(DBO) was carried out at the balance sheet date. The present
value of the defined benefit obligations and the related current service cost and past service cost were measured
using the Projected Unit Credit Method.

Based on the actuarial valuation obtained in this respect, the following table sets out the details of the employee
benefit obligation as at balance sheet date:

b) The estimates of future salary increases considered in the actuarial valuation take account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in the employment market.

c) The gratuity fund is managed by Life Insurance Corporation of India and details of fund invested by insurer are
not available with Company.

d) The Company expects to make a contribution of Rs. 6.00 Crore to the defined benefit plans (gratuity - funded)
during the next financial year.

e) The average duration of the defined benefit plan obligation at the end of the reporting period is 6 years.

Risk exposure

Valuations are performed on certain basic set of pre-determined assumptions and other regulatory frame work
which may vary over time. Thus, the Company is exposed to various risks in providing the above gratuity benefit
which are as follows:

Interest Rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will
result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the
value of the liability (as shown in financial statements).

Liquidity Risk: This is the risk that the Company is not able to meet the short-term gratuity payouts. This may
arise due to non-availability of enough cash / cash equivalent to meet the liabilities or holding of illiquid assets not
being sold in time.

Salary Escalation Risk: The present value of the defined benefit plan is calculated with the assumption of salary
increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants
from the rate of increase in salary used to determine the present value of obligation will have a bearing on the
plan's liability

Demographic Risk: The Company has used certain mortality and attrition assumptions in valuation of the liability.
The Company is exposed to the risk of actual experience turning out to be worse compared to the assumptions.

Regulatory Risk: Gratuity benefit is paid in accordance with the requirements of the Payment of Gratuity
Act,1972 (as amended from time to time) and Company's Schemes for different category of employees. There is
a risk of change in regulations requiring higher gratuity payouts.

Asset Liability Mismatching or Market Risk: The duration of the liability is longer compared to duration of
assets, exposing the Company to the market risk for volatilities/fall in interest rate.

Investment Risk: The probability or likelihood of occurrence of losses relative to the expected return on any
particular investment.

B. Measurement of fair value

The following methods and assumptions were used to estimate the fair values:

a) The carrying amounts of trade receivables, trade payables, deposits, other receivables, cash and cash equivalent
including other current bank balances and other liabilities including deposits, creditors for capital expenditure,
etc. are considered to be the same as their fair values, due to current and short term nature of such balances.

b) Financial instruments with fixed and variable interest rates are evaluated by the Company based on parameters
such as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances
if required, are taken to account for expected losses of these receivables.

c) The fair value of the Equity Investments which are quoted, are derived from quoted market prices in active market.

d) The fair values of investments in mutual fund units is based on the net asset value ('NAV') as stated by the
issuers of these mutual fund units in the published statements as at Balance Sheet date. NAV represents the
price at which the issuer will issue further units of mutual fund and the price at which issuers will redeem such
units from the investors.

C. Fair Value Hierarchy

The fair value of financial instruments as referred to above have been classified into three categories depending
on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active
markets for identical assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs (Level 3
measurements).

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity
instruments and mutual funds that have quoted price. The fair value of all equity instruments which are traded in the
stock exchanges is valued using the closing price as at the reporting period.

Level 2: The fair value of financial instruments that are not traded in an active market is 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 is not based on observable market data, the instrument is included in
level 3. This is the case for unlisted equity securities included in level 3.

(47) Financial Risk Management

The process of identification and evaluation of various risks inherent in the business environment and the operations
of the Company and initiation of appropriate measures for prevention and/or mitigation of the same are dealt with by
the concerned operational heads under the overall supervision of the Managing Director of the Company. The Audit
Committee periodically reviews the adequacy and efficacy of the overall risk management system. The Company's
financial risk management is an integral part of how to plan and execute its business strategies. The Company has in
place adequate Internal Financial Controls with reference to financial statements and such internal financial controls are
operating effectively. The Company has adopted policies and procedures for ensuring the orderly and efficient conduct of
its business, including adherence to the Company's policies, the safeguarding of its assets, prevention and detection of
frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial statements.
The Company has exposure to the following risks arising from financial instruments:

• Credit risk

• Liquidity risk and

• Market risk
A 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 trade and other receivables. The carrying
amounts of financial assets represent the maximum credit risk exposure.

i Trade and Other receivables

The Company is recording the allowance for expected credit losses for all financial assets not held at FVTPL,
together with loan commitments and financial guarantee contracts, (in this section all referred to as 'financial
instruments'). Equity instruments are not subject to impairment under IND AS 109.

The ECL allowance is based on:

a) 12 months' expected credit loss (12mECL) where there is no significant increase in credit risk since
origination and;

b) on the credit losses expected to arise over the life of the asset (the lifetime expected credit loss or LTECL).

The 12mECL is the portion of LTECL that represents the ECL that results from default events on a financial
instrument that are possible within the 12 months after the reporting date.Both LTECL and 12mECL are
calculated on individual and collective basis, depending on the nature of the underlying financial assets.
The Company has established a policy to perform an assessment, at the end of each reporting period, of
whether a financial instrument's credit risk has increased significantly since initial recognition.

Based on the above process, the Company groups its Financial assets into Stage 1, Stage 2, Stage 3, as
described below:

Stage 1 : When financial assets are first recognised, the Company recognises an allowance based on
12mECL. Stage 1 loans also include facilities where the credit risk has improved and the loan has been
reclassified from Stage 2 or Stage 3.

Stage 2: When a financial assets has shown a significant increase in credit risk since origination, the
company records an allowance for the LTECL. Stage 2 financial assets, where the credit risk has improved
and the loan has been reclassified from Stage 3.

iii Cash and bank balances

The Company held cash and cash equivalent and other bank balance of Rs. 25.60 crores at March 31, 2025
(March 31, 2024: Rs 52.57 crores). The same are held with banks having good credit rating.

B 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.

Management monitors rolling forecasts of the Company's liquidity position and cash and cash equivalents on the basis
of expected cash flows.

A Maturities of financial liabilities

The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are
gross and undiscounted.

The Company does not have any disputed trade payable as on 31st March 2025 (previous year: Nil)

C Market risk

Market risk is the risk that changes in market prices, such as interest rates (interest rate risk), will affect the company's
income. The objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimising the return.

D Interest rate risk

Interest rate risk is the risk that the fair value or future cashflows of a financial instrument will fluctuate because of
changes in market interest rates. The Company's exposure to the risk of changes in market interest rates relates
primarily to the Company's long term debt obligation at floating interest rates. The company's fixed rate borrowings
are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither
the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.

E Interest rate risk exposure

The exposure of the Company's borrowing to interest rate changes at the end of the reporting period are as follows:

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

V The Code on Social Security, 2020 ('Code') has been notified in the Official Gazette in September 2020 which
could impact the contribution by the Company towards certain employment benefits. The effective date from which
the changes and rules would become applicable is yet to be notified. Impact of the changes will be assessed and
accounted in the relevant period of notification of relevant provisions.

VI Disclosure with respect to monthly / quarterly statement of Current assets filed with Bank

The Company has not availed any secured loans facilities from bank, hence the company is not required to file
monthly/quarterly returns or statements with the banks.

VII In view of the aggregate losses as calculated in accordance Sec 135 and 198 of the companies Act,2013 during last
3 years immediately preceding financial years,the company is not required to incur any expenditure in pursuance of
the CSR policy for the FY 2024-25.(Previous year : NIL).

(50) ACCOUNTING FOR THE SCHEME OF ARRANGEMENT

The Board of Directors of the Company and Mukand Sumi Metal Processing Limited (MSMPL), a wholly owned subsidiary
of the Company, had approved demerger of Stainless Steel Cold Finished Bars and Wires business of MSMPL ('Demerged
Undertaking) as a going concern pursuant to the Scheme of Arrangement amongst the Company, MSMPL and their
respective Shareholders and Creditors under Sections 230 to 232 read with Section 52 (“Demerger”) and other applicable
provisions of the Companies Act, 2013 (Scheme).

The Scheme has been approved by the National Company Law Tribunal (“NCLT”) vide its order dated April 29, 2025 and a
certified copy of the order has been filed with the Registrar of Companies, Mumbai Maharashtra, on May 12, 2025.

Since MSMPL is a wholly owned subsidiary of the Company, no additional shares are issued by the Company, pursuant to
the Scheme.

In terms of the approved Scheme, the Demerger has been accounted as per the applicable accounting principles as laid
down in Appendix C to Ind AS 103 “Business Combination of entities under common control”. The Assets and Liabilities of
Demerged undertaking are recorded by the Company at their respective book values as appearing in the books of MSMPL
with effect from April 01,2024 (“The Appointed Date”). Accordingly, the financial statements of the Company for previous
year have been restated to reflect the impact of the Scheme of Arrangement.

As per the accounting treatment approved by the NCLT, the Company has adjusted the deficit of Rs.34.01 crores after
recording Assets & Liabilities transferred from the demerged Company and adjustments made in investments held in
Demerged Company and after considering the impact pursuant to cancellation of the inter-company, with “Capital Reserve
Account” in the financial statement of the Company.

(51) Previous year's figures have been regrouped/recast wherever necessary.

As per our attached report of even date For and on behalf of the Board of Directors

For DHC & Co.

Chartered Accountants ^{Niraj Bajaj R Sankaran}

ICAI FR No 103525W Chairman & Managing Director Director

DIN : 00028261 DIN : 00381139

Pradhan Daas

P_art_ner Dhanesh K Goradia Rajendra Sawant

Membership No. 219962 Chief Financial Officer Company Secretary

Bengaluru, May 16, 2025 Mumbai, May 16, 2025