The Company's investment property consist of properties in the nature of land and buildings in India. As at March 31, 2024 and March 31, 2023 the fair values of the properties are ' 1,337.26 Lakhs and ' 124.34 Lakhs.

The fair value of investment property (as measured for disclosure purposes in the financial statements) is based on the valuation by a registered valuer as defined under rule 2 of Companies (Registered Valuers and Valuation) Rules, 2017.

The fair value hierarchy is at level 2, which is derived using the market comparable approach based on recent market prices without any significant adjustments being made to the market observable data.

The Company has no restrictions on the realisability of its investment properties and no contractual obligations to either construct or develop investment properties or for repairs, maintenance and enhancements.

LAKSHMI ELECTRICAL CONTROL SYSTEMS LIMITED

Notes to the Financial Statements for the year ended 31^st March, 2024 (All amounts in ' Lakhs, unless otherwise stated)

Total Inventories 3,044.20 3,201.39

Inventories are valued at the lower of cost and net realizable value.

The cost of inventories recognised as an expense amounted to ' 27532.22/- lakhs.[Previous year ' 29281.54 /- lakhs]

Particulars As at 31^st March, 2024 As at 31^st March, 2023

11 TRADE RECEIVABLES

Trade Receivables Considered good-Secured - -

Trade Receivables Considered good-Unsecured* 6,044.36 8,877.84

Trade Receivables which have significant increase in credit risk -

Trade Receivables- credit impaired -

6,044.36 8,877.84

Less: Expected Credit loss allowance 12.61 17.32

Total Trade Receivables 6,031.75 8,860.52

*Includes dues from Companies where directors are interested 10.78 26.71

11a) Trade Receivables Ageing Schedule as at 31^st March 2024

11a) Trade Receivables Ageing Schedule as at 31^st March 2024

Terms and rights attached to equity shares

The Company has only one class of equity shares having a par value of ' 10/- each. All these equity shares have the same rights and preferences with respect to payment of dividend, repayment of capital and carries one vote for every such class of shares held. In the event of liquidation, the excess assets shall be distributed amongst the members in proportion to the capital.

21.2 The Company has borrowings from banks on the basis of security of current assets. There are no material discrepancies between the quarterly returns or statements of current assets filed by the Company with banks compared with the books of accounts taking into account the reconciliation of such discrepancies.

34 EMPLOYEE BENEFIT OBLIGATIONS

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company has recognised Rs. 121.60 Lakhs (Previous year: Rs 111.00 Lakhs) as contribution to Provident Fund, and Rs 8.09 Lakhs (Previous year: 7.26 Rs Lakhs) as contribution to Employee State Insurance (ESI) in the Statement of Profit and Loss. These contributions have been made at the rates specified in the rules of the respective schemes and has been recognised in the Statement of Profit and Loss under the head Employee Benefits Expense.

(v) Brief description of the Plans & risks

These plans typically expose the Company to actuarial risks such as : Investment risk, interest risk, longetivity risk and salary risk.

Investment risk:

The present value of the defined benefit plan liability is calculated using a discount which is determined with reference to market yields at the end of the reporting period on government bonds. Plan investment is a mix of investments in government securities, other debt instruments and equity shares of listed companies.

Interest risk:

A decrease in the bond interest rate will increase the plan liability. However, this will be partially offset by an increase in the return on the plan's debt instruments, if any.

Longetivity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan's liability.

Salary risk:

The present value of the defined benefit plan liabilty is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of plan participants will increase the plan's liability.

The above sensitivity analysis are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in the balance sheet.

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the group has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.

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

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) 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, contingent consideration and indemnification asset included in level 3.

There are no transfers between levels 1 and 2 during the year.

The company's policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.

(ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include the use of quoted market prices or dealer quotes for similar instruments. The carrying amounts of trade receivables, trade payables, cash and cash equivalents and other current financial liabilities are considered to be the same as their fair values, due to their short-term nature.

36 CAPITAL MANAGEMENT

(a) Risk management

The company's objectives when managing capital are to

• safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

• maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, The company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

Company's debt consists of short term borrowings currently and it intends to maintain a optimal gearing ratio for optimising shareholder value.

37 FINANCIAL RISK MANAGEMENT

The Company's activities expose it to market risk, liquidity risk and credit risk.

(A) Credit risk

Company faces credit risk from cash and cash equivalents, deposits with banks and financial institutions and unsecured trade receivables. The Company doesn't face any credit risk with other financial assets.

(i) Credit risk management

Credit risk on deposit is mitigated by depositing the funds in Scheduled Commercial Banks.

For trade receivables, the primary source of credit risk is that these are unsecured.The Company sells the products to customers only when the collection of trade receivables is certain and whether there has been a significant increase in the credit risk on an on-going basis is monitored throughout each reporting period. As at the balance sheet date, based on the credit assessment the historical trend of low default is expected to continue. An impairment analysis is performed at each reporting date on an individual basis for major clients. Any recoverability of receivables is provided for based on the impairment assessment.

Credit risk on cash and cash equivalents is limited as the Company generally invest in deposits with banks and financial institutions with high ratings assigned by international and domestic credit rating agencies. Ratings are monitored periodically and the Compnay has considered the latest available credit ratings as at the date of approval of these financial statements.

(B) Liquidity risk

Objective of liquidity risk management is to maintain sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Management monitors rolling forecasts of the Company's liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows. The company's liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal requirements .

The bank overdraft facilities may be drawn at any time and may be terminated by the bank without notice. Subject to the continuance of satisfactory credit ratings, the bank loan facilities may be drawn at any time in INR and have an average maturity of 1 year.

(ii) Maturities of financial liabilities

The tables below analyse the company's financial liabilities into relevant maturity groupings based on their contractual maturities for:

a) all non-derivative financial liabilities, and

b) net and gross settled derivative financial instruments for which the contractual maturities are essential for an understanding of the timing of the cash flows.

The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

(C) Market risk

(i) Foreign currency risk

The Company activities exposes it to foreign exchange risk arising from foreign currency transactions, primarily with respect to the USD and EURO. Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the Company's functional currency (INR). The risk is measured through a forecast of highly probable foreign currency cash flows.

Equity price risk is related to the change in market reference price of the investments in equity securities. The fair value of sum of the company's investments measure at fair value through other comprehensive income exposes to the company to equity price risks. This investments are subject to change in the market price of securities.

The fair value of company's investment quoted equity securities ar of March 31, 2024 and March 31, 2023 was ' 13,498.59 lakhs and ' 8,872.55 lakhs respectively.

A 5% change in equity price of March 31, 2024 and March 31, 2023 would result in impact of ' 674.93 lakhs and ' 443.63 lakhs respectively.

(D) Interest Rate Risk (i) Assets

The Company holds interest bearing assets in the form of fixed deposits with banks. The variation in interest risks is managed by distributing deposits among wide base of banks and financial institutions.

Future cash flows in respect of the above matters are determinable only on receipt of judgements / decisions pending at various forums / authorities. Management is hopeful of successful outcome in the appellate proceedings.

Disputed tax dues are appealed before concerned appellate authorities. The company is advised that the cases are likely to be disposed off in favour of the company and hence no provision is considered necessary therefor.

42 COMMITMENTS Capital commitments

Capital expenditure contracted for at the end of the reporting period but not recognised as liabilities is as follows:

46.2 Details of the items included in numerator and denominator for computing the above ratios.

a) Capital employed refers to sum of [Share Capital Reserves & Surplus - Intangible Assets Lease Liabilites Deferred Tax liabilities Total Debt-Borrowings]

b) Earnings before interest and taxes = [Profits after current & deferred taxes Finance Costs Current Taxes Deferred Taxes]

c) Earnings available for debt servicing = [ Net profit after current & deferred taxes Depreciation Finance cost [Incl Interest on lease liabilities] - Profit on sale of assets - Dividend income - Interest income ]

47 The three labour codes, the Occupational Health, Safety and Working Conditions Code 2020, the Industrial Relations Code 2020 and the Code on Social Security 2020 have been passed by the Parliament and have also received the assent of the President of India on 28^th September 2020. However, the date on which these Codes will come into effect has not been notified. The Company will assess the impact of these Codes and will record any related impact in the period these Codes become effective.

48 Additional Regulatory Disclosures as per Schedule III of Companies Act, 2013

i) . There are no proceedings initiated or pending against the company for holding any benami property under the

Benami Transactions (Prohibition) Act, 1988 and rules made there under.

ii) . There are no transactions not recorded in the books of accounts that have been surrendered or disclosed as income

during the year in the tax assessments under the Income tax Act, 1961.

iii) . The Company has not (which are material either individually or in the aggregate) advanced or loaned or invested any

funds (either from borrowed funds or share premium or any other sources or kind of funds) in any other person or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

iv) . The Company has not (which are material either individually or in the aggregate) received any funds from any

person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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.

v) . The Company has not been declared as a wilful defaulter by any bank or financial institution or government or any

government authority.

vi) . As per the information available with the Company, the Company has no transactions with the companies struck off

under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.

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

March 31, 2024.

viii) .No scheme of arrangement has been approved by the competent authority in terms of Section 230 to 237 of the Companies Act, 2013.

ix) . The Company has not made investments in more than one layer of body corporate in accordance with provisions

of clause (87) of section 2 of the Companies Act, 2013 read with the Companies (Restriction on number of Layers) Rules, 2017.

49 The financial statements were approved for issue by the Board of Directors on 23^rd May, 2024.

50 The final dividend on shares is recorded as liablity on the date of approval by the shareholders.

Dividend declared by the company are based on the profits available for distribution.

The Board of Directors have recommended a dividend of ' 15.00/- (150%) each per equity share of the face value of ' 10 each, subject to the approval of the shareholders at the ensuing Annual General Meeting. This will result in a total dividend outgo of ' 368.70/- Lakhs.

51 Lease Arrangements:

Company as Lessee:

Rental Expense recorded for short-term leases was Rs. 12.14 lakhs (Previous year Rs. 0.18 lakhs).

Total Cash out flow for leases including short term lease was Rs. 12.14 lakhs (Previous year Rs. 0.18 lakhs).

52 The figures of the previous year have been regrouped / rearranged wherever necessary to correspond with the current year figures.

All the figures have been rounded off to lakhs unless stated otherwise. Discrepancies, if any, in between the totals and the sum of the items forming part of such totals are due to rounding off in the financial statements. Wherever figures, are indicated as 0.00 lakhs, it represents value less than Rs. 0.01 lakhs due to rounding off to the nearest lakhs.