(i) Building (gross block) amounting INR 1,428.55 million (March 31,2025: INR 1,213.69 million), net block INR 1,053.62 million (March 31,2025: INR 896.82 million) is constructed on leasehold land.

(ii) Refer note 40 for disclosure of contractual commitments for the acquisition of property, plant and equipment.

(iii) Refer note 15 for information on property, plant and equipment pledged as security by the Company.

(iv) Property, plant and equipment (net carrying amount) of INR 298.54 million (March 31,2025: INR 148.10 million) and capital work-in-progress of INR 22.18 million (March 31,2025: INR 24.63 million) is lying with job workers.

(v Capital work-in-progress includes amount of INR 14.72 million (March 31,2025: INR 22.83 million) pertaining to projects in progress which have crossed the budgeted period.

(vi) During the year, based on a technical evaluation of the useful life of its plant and machinery carried out by the Company, it has revised the remaining estimated useful life of certain items of plant and machinery with effect from April 01, 2025 to reflect fairly the economic benefit it expects to receive from the continuing use of those assets. This has resulted in a decrease in depreciation charge by INR 329.40 million for the year ended March 31,2026.

ii) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having a par value of INR10 per share. Each holder of equity shares is entitled to one vote per share. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity share holders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

(i) Securities premium represents premium received on issuance of shares. The balance is utilised in accordance with the provisions of the Companies Act, 2013.

(ii) During the previous year, the Company incurred INR 305.00 million as expenses in connection with funds raised through Qualified Institutional Placement (QIP) aggregating to INR 24,000.00 million. In accordance with the provisions of Section 52 of the Companies Act, 2013 and the treatment provided under Ind AS 32 (Financial Instruments: Presentation) as well as Ind AS 12 (Income Taxes), as sum of INR 230.42 million (after reducing Income taxes of INR 74.58 million) has been adjusted against the Securities Premium.

Companies Act, 2013 requires that where a Company purchases its own shares out of free reserves or securities premium account, a sum equal to the nominal value of the shares so purchased shall be transferred to a capital redemption reserve account and details of such transfer shall be disclosed in the balance sheet. The capital redemption reserve account may be applied by the Company, in paying up unissued shares of the Company to be issued to shareholders of the Company as fully paid bonus shares. The Company established this reserve pursuant to the buyback of shares in earlier years.

a) Indian Rupee loans repayable on demand from banks

Above working capital loan is secured by first pari passu charge on entire current assets of the Company and second pari passu charge on the entire moveable fixed assets, present and future, of the Company and immovable fixed assets situated at Gurgaon only.

Repayment and rate of interest:

i) WCDL amounting INR 740 million (March 31,2025: Nil) is repayable on demand carries interest @ floating rate linked with T-bill, current year effective rate is in the range of 6.01% - 6.30% p.a (March 31,2025: N/A)

ii) EPC amounting INR 1,450 million (March 31,2025: Nil) is repayable on demand carries interest @ floating rate linked with T-bill, current year effective rate is in the range of 6.07% - 6.33% p.a (March 31,2025: N/A)

All assets and liabilities measured at amortised cost have been classified as level 3, as prescribed under the accounting standard. An explanation of each level is given above.

There are no transfers amongst levels during the year

Level 1: It includes financial instruments measured using quoted prices in active markets for identical assets or liabilities.

Level 2: Directly (i.e. as prices) or indirectly (i.e. derived from prices) observable market inputs other than Level 1 inputs; and

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. 33 FINANCIAL RISK MANAGEMENT

The Company’s principal financial liabilities comprise loans and borrowings, trade payables and other financial liabilities. The main purpose of these financial liabilities is to provide finance to the Company to support its operations. The Company’s principal financial assets include loans, trade and other receivables; cash and bank balances etc. that derive directly from its operations.

The Company's activities expose it to the financial risk of market risk, credit risk and liquidity risk. The Company enters into a certain derivative financial instrument to manage its exposure to foreign currency. There have been no major changes to the Company's exposure to market risk or the manner in which it manages and measures the risk in recent past. The Company’s senior management oversees the management of these risks. The Company’s senior management ensures that the Company’s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives.

(A) Credit risk

Credit risk is the risk that a customer or counterparty to a financial instrument fails to discharge an obligation to the Company. The Company’s maximum exposure to credit risk is limited to the carrying amount of following types of financial assets.

• Cash and cash equivalents

• Trade receivables

• Loans carried at amortised cost, and

• Other financial assets

• Derivative financial assets

(a) Credit Risk Management

(i) Credit risk rating

The Company assesses and manages credit risk of financial assets based on following categories arrived on the basis of assumptions, inputs and factors specific to the class of financial assets.

a) Low credit risk

b) Moderate credit risk

c) High credit risk

Based on business environment in which the Company operates, a default on a financial asset is considered when the counter party fails to make payments within the agreed time period as per contract. Loss rates reflecting defaults are based on actual credit loss experience and considering differences between current and historical economic conditions.

Assets are written off when there is no reasonable expectation of recovery, such as a debtor declaring bankruptcy or a litigation decided against the Company. The Company continues to engage with parties whose balances are written off and attempts to enforce repayment. Recoveries made are recognised in statement of profit and loss.

(b) Expected credit losses for financial assets (other than trade receivables) |

i) Financial assets (other than trade receivables)

Company provides for expected credit losses on loans and advances other than trade receivables by assessing individual financial instruments for expectation of any credit losses.

For loans comprising security deposits paid - Credit risk is considered low because the Company is in possession of the underlying asset.

For other financial assets - Credit risk is evaluated based on Company knowledge of the Credit worthiness of those parties and loss allowance is measured. Since this category includes loans and receivables of varied natures and purpose, there is no trend that the Company can draw to apply consistently to entire population. For such financial assets, the Company policy is to provide for 12 month expected credit losses upon initial recognition and provide for lifetime expected credit losses upon significant increase in credit risk. The Company does not have any expected loss based impairment recognised on such assets.

ii) Expected credit loss for trade receivables under simplified approach

The Company recognises lifetime expected credit losses on trade receivables using a simplified approach. In accordance with Ind AS 109, the Company uses expected credit loss model to assess the impairment loss. The Company uses a provision matrix to compute the expected credit loss allowance of trade receivables. The provision matrix takes into account available external and internal credit risk factors such as default risk of industry, historical experience for customers etc. However, the allowance for lifetime expected credit loss on customer balances for the year ended March 31, 2026, and for the year ended March 31,2025 is insignificant. Considering the nature of trade receivables, and entity's history of credit with those receivables, entity has rebutted the presumption of having significant increases in credit risk since initial recognition for financial assets which are more than 30 days past due.

Cash & cash equivalents and bank deposits

Credit risk related to cash and cash equivalents and bank deposits is managed by only accepting highly rated banks and diversifying bank deposits and accounts in different banks across the country. In respect of derivative assets, the credit risk is considered negligible as counterparties are banks.

Trade receivables

To mitigate the credit risk related to trade receivables, the Company closely monitors the credit-worthiness of the trade receivables through internal systems that are configured to define credit limits of customers, thereby, limiting the credit risk to pre-calculated amounts. The Company assesses increase in credit risk on an ongoing basis for amounts receivable that become past due and default is considered to have occurred when amounts receivable become past due.

(B) Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. The Company's objective is to at all times maintain optimum levels of liquidity to meet its cash and liquidity requirements. The Company closely monitors its liquidity position and maintains adequate source of financing through the use of short term bank deposits, demand loans and cash credit facility. Processes and policies related to such risks are overseen by senior management.

(i) Maturities of financial liabilities

The table below provides details regarding the non-derivative financial liabilities have contractual undiscounted maturities as summarised below:

(C) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity price risk. Financial instruments affected by market risks include loans and borrowings, deposits and foreign currency receivables and payables. The sensitivity of the relevant profit and loss item is the effect of the assumed changes in the respective market risks. This is based on the financial assets and financial liabilities.

(i) 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. The Company is exposed to risk of changes in borrowing rates. The Board continuously monitors the prevailing interest rates in the market.

34 CAPITAL MANAGEMENT

For the purposes of the Company’s capital management, capital includes equity attributable to the equity holders of the Company and all other equity reserves. The primary objective of the Company’s capital management is to ensure that it maintains an efficient capital structure and maximize shareholder value. The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders or issue new shares. The Company is not subject to any externally imposed capital requirements.

The Board of Directors of the Company in its meeting held on April 30, 2026 has recommended final dividend of INR 1.80/-i.e (18.00%) per equity share of the Company having face value of INR 10/- each for the financial year 2025-2026, subject to approval from shareholders.

35 SEGMENT INFORMATION

The Company’s operating business is organised and managed according to a single primary reportable business segment namely “Mobility components, systems and sub-systems”. The Company has opted to provide segment information in its consolidated Ind AS financial statements in accordance with para 4 of Ind AS 108 - Operating Segments.

36 RELATED PARTY DISCLOSURES

In accordance with the requirement of Indian Accounting Standard (Ind AS) 24 "Related Party Disclosures", name of the related parties, related party relationships, transactions and outstanding balances including commitments where control exist and with whom transactions have taken place during the reported period are as follows:

XI The average duration of the defined benefit plan obligation at the end of the reporting period is 5.74-15.48 years (March 31,2025: 5-6.20 years)

XII The estimates of rate of escalation in salary considered in actuarial valuation are after taking into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is as certified by the Actuary. The sensitivity analysis above have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The expected contribution to the plan is expected to be similar to that of current year.

XIII Plan is governed by the Payment of Gratuity Act, 1972. Under the Gratuity Act, employees are entitled to specific benefit at the time of retirement or termination of the employment on completion of five years or death while in employment. The level of benefit provided depends on the member’s length of service and salary at the time of retirement/termination age.

43 LEASES

i) The Company has entered into lease arrangements for land, building and plant and machinery that are renewable on a periodic basis with approval of both lessor and lessee.

ii) The Company does not have any lease commitments towards variable rent as per the contract.

iii) Each lease generally imposes a restriction that, unless there is a contractual right for the Company to sublet the asset to another party, the right-of-use asset can only be used by the Company. The Company is prohibited from selling or pledging the underlying leased assets as security. For leases over land and building the Company must keep those properties in a good state of repair and return the properties in their original condition, except for normal wear and tear, at the end of the lease. Further, the Company shall insure items owned by it and incur maintenance fees on such items in accordance with the lease contracts.

The total amount to be expensed over the vesting period is determined by reference to the fair value of the options granted. The fair values of options granted were determined using Black-Scholes option pricing model that takes into account factors specific to the share incentive plans along with other external inputs. Expected volatility has been determined by reference to the average volatility for comparable companies for corresponding option term. Total Company share based payment to employees amounting INR Nil for the year ended March 31, 2026 (Nil for the year ended March 31, 2025) is recognised in the statement of profit and loss of the Company pertaining to options issued to employees of the Company. The following principal assumptions were used in the valuation: Expected volatility was determined by comparison with peer companies, as the Company’s shares were not publicly traded at that time. The expected option life and average expected period to exercise, is assumed to be equal to the contractual maturity of the option. Dividend yield is taken as 1.6% based on the expected dividend payout by the management. The risk-free rate is the rate associated with a risk-free security with the same maturity as the option. At each balance sheet date, the Company reviewed its estimates of the number of options that are expected to vest. The Company recognizes the impact of the revision to original estimates, if any, in the profit or loss in statement of comprehensive income, with a corresponding adjustment to ‘retained earnings’ in equity. The fair value of option using Black Scholes model and the inputs used for the valuation for options that have been granted during the reporting period are summarized as follows:

Stock options will be settled by issue of equity shares of the Company. As per the plan, holders of vested options are entitled to purchase one equity share for every option at an exercise price of INR 508.95/ INR 641.60 / INR 478.70 per option against the fair market value of INR 508.95/INR 641.60/ INR 478.70 per share determined on the date of grant, i.e. October 25, 2023, March 15, 2024 and October 27, 2025 respectively.

The total amount to be expensed over the vesting period is determined by reference to the fair value of the options granted. The fair values of options granted were determined using Black-Scholes option pricing model that takes into account

factors specific to the share incentive plans along with other external inputs. Expected volatility has been determined by reference to the average volatility for comparable companies for corresponding option term. Total Company share based payment to employees amounting INR 181.98 million (excluding INR 9.66 million capitalised) for the year ended March 31, 2026 (March 31,2025 INR 269.27 million (excluding INR 18.42 million capitalised)) is recognised in the statement of profit and loss of the Company pertaining to options issued to employees of the Company. The following principal assumptions were used in the valuation: Expected volatility was determined basis 50% weight to Sona BLW Precision Forgings Limited and a balance of 50% weight equally to the other comparable companies. The expected option life and average expected period to exercise, is assumed to be equal to the contractual maturity of the option. Dividend yield is taken as 0.55%, 0.48% and 0.67% based on the expected dividend payout by the management. The risk-free rate is the rate associated with a risk-free security with the same maturity as the option. At each balance sheet date, the Company reviewed its estimates of the number of options that are expected to vest. The Company recognizes the impact of the revision to original estimates, if any, in the profit or loss in statement of comprehensive income, with a corresponding adjustment to ‘retained earnings’ in equity. The fair value of option using Black Scholes model and the inputs used for the valuation for options that have been granted during the reporting period are summarized as follows:

(c) Pursuant to the approval by the NRC and the Board of Directors of the Company, on December 19, 2025, the shareholders approved the Sona Performance Share Plan 2025 (the Scheme) for the Managing Director (MD) and Group CEO. On January 22, 2026, NRC approved allotment of 1,25,915 equity shares to him as per the Scheme at face value based on performance metrics defined in the Scheme. Total Company share based payment to employee amounting INR 54.89 million for the year ended March 31, 2026 (March 31, 2025 Nil) is recognised in the statement of profit and loss of the Company pertaining to scheme issued to employee of the Company.

46 (a) Intangible assets impairment testing Goodwill

As per note no. 4, Company has recognized an amount of INR 3,628.00 million (March 31,2025: INR 1,582.24 million) as Goodwill including assembled workforce and future customers. Annual test for impairment of goodwill was carried out as at March 31,2026 and March 31,2025, details of which are outlined below. The outcome of the test indicated that the value in use of business was higher than its carrying value in those CGU’s (Cash generating unit). Accordingly, no impairment charge has been recognized in the standalone statement of profit and loss.

The recoverable amount of each CGU was determined based on value-in-use calculations using a discount rate ranging between 13.00%-18.50% reflecting current market assessments of the time value of money and risks specific to the business, covering a detailed five-year forecast, followed by an extrapolation of expected cash flows using a terminal growth rate of approximately 3.5% - 4.5% as determined by the management.

Brand

On August 01,2018, the Company acquired SONA Intellectual property rights (""Sona IP"") and all rights thereto from SONA Management Services Limited (""SMSL"") having indefinite useful lives, pursuant to which the Company had recognised brand amounting to INR 687.40 million. This was due to the expectation of permanent use of acquired brand. The Company tests on an annual basis whether the brand is impaired based on the value-in-use concept of the entity basis certain inputs outlined below. In March 2026 and March 2025, there was no impairment identified for the brand.

The recoverable amount of the entity was determined on the basis of value in use based on the present value of the expected future cash flows. This calculation uses cash flow projections based on the financial planning covering a five-year period in total. The management believes that any reasonable possible changes in the key assumptions would not cause the Brand's carrying amount to exceed its recoverable amount."

The recoverable amount of the brand was determined based on value-in-use calculations for the Company using a discount rate ranging between 13%-14% reflecting current market assessments of the time value of money and risks specific to the business as at the respective dates, covering a detailed five-year forecast, followed by an extrapolation of expected cash flows using a terminal growth rate ranging between 3%-5% as determined by the management.

Intangible assets under development

In accordance with IND AS 36 - “Impairment of Assets”, the Company has carried out commercial feasibility assessment of intangibles under development (‘IAUD’) amounting to INR 61.75 million (March 31, 2025: INR 627.11 million) and has not identified any impairment which is required to be recorded in the financial statements. (refer note 5)

Growth rates

The growth rates used are in line with the growth rate of the industry and the countries in which the entities operates and are consistent with the internal/external sources of information.

Discount rates

The discount rates take into the consideration market risk and specific risk factors of the entity. The cash flow projections are based on the forecasts made by the management.

Terminal growth rate

The terminal growth rate is the constant rate at which an entity is expected to grow at the end of the last forecasted cash flow period in a discounted cash flow model and goes into perpetuity.

Sensitivity

The management believes that any reasonable possible changes in the key assumptions would not cause the cash generating unit's carrying amount to exceed its recoverable amount.

(b) Investment in Novelic d.o.o. Beograd Zvezdara

During the year ended March 31,2024, the Company had acquired 54% stake (representing 54% voting interest) of Novelic d.o.o., world's leading self-sustaining provider of mmWave radar sensors, perception solutions, and full stack embedded systems on September 06, 2023 for its unique & patented mmWave radar technology which is the best solution for in-cabin sensing.

As on March 31, 2026 amounting to Nil (March 31,2025: INR 728.44 million) payable under a deferred payment mechanism to founders of Novelic d.o.o. and Novelic d.o.o., as per the Share purchase agreement and shareholder agreement. First tranche of 60% was paid upfront in September 2023, second tranche of 20% was paid in September 2024 and the third tranche of 20% was paid in September 2025, as per the Agreements, thereby settling the total consideration.

(c) Impairment of Investment in Novelic d.o.o. Beograd Zvezdara

As mentioned in the note no. 5, the Company has invested an amount of INR 3,506.37 million (March 31, 2025: INR 3,506.37 million) (for acquisition of 54% voting rights of Novelic d.o.o. Beograd Zvezdara. Test for impairment of this investment was carried out as at March 31, 2026, details of which are outlined below. The outcome of the test indicated that the value in use of investment was higher than its carrying value as at March 31, 2026 and March 31,2025. Accordingly, no impairment charge has been recognized in the standalone statement of profit and loss.

The recoverable amount of this investment was determined based on value-in-use calculations using a discount rate ranging between 22.00%-25.00% reflecting current market assessments of the time value of money and risks specific to the business, covering a detailed ten-year forecast, followed by an extrapolation of expected cash flows using a terminal growth rate of approximately 3.00% - 4.00% as determined by the management."

47 During the previous year, the Company had raised funds through Qualified Institutional Placement (QIP) of 34,782,608 Equity Shares of the face value of INR 10 each at a premium of INR 680.00 per share aggregating to INR 24,000.00 million (INR 23,695.00 million net of issue expenses) for certain specific purposes as stated in the Placement Document. Total net QIP proceeds amounting to INR 23,695 million has been utilised for the repayment of borrowings, purchase of fixed assets, making strategic investments and for general corporate purposes. The equity shares issued as a result of QIP have been considered in calculating earnings per share (EPS) for the relevant periods.

The Company's hedging policy only allows for effective hedge relationships to be established. Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness assessment to ensure that an economic relationship exists between the hedged item and hedging instrument.

For forward contracts, hedge effectiveness is measured using hypothetical derivative method. Ineffectiveness is measured by comparing the change in the fair value of the actual derivative i.e. forward contracts designated as the hedging instrument and the change in the fair value of a hypothetical derivative representing the hedged item i.e. highly probable forecast sales. Hypothetical derivative matches the critical terms i.e. maturity date, currency and amount of highly probable forecast sales.

In hedges of foreign currency forecast sales, ineffectiveness mainly arises because of Change in timing of hedged item from that of the hedging instrument and cost of hedging. The ineffectiveness arised in the hedges have been disclosed in above table.

49 BUSINESS COMBINATIONS

The Company completed acquisition of the Railway Business on a going concern basis from Escorts Kubota Limited with effect from June 01,2025 through a slump sale transaction for a consideration of INR 16,426.32 million. The acquired Railway business specializes in the production and supply of mission critical railway components such as brake systems, couplers, suspension products, and various friction and rubber products.

The Company allocated purchase price in accordance with Ind AS 103 on business combinations. The fair value of net assets acquired was determined based on an appraisal of such net assets determined by an external expert on behalf of the management.

50 OTHER STATUTORY INFORMATION

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

(ii) The Company do not have any transactions with struck off companies during the current and previous year.

(iii) The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period,

(iv) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.

(v) 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:

(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

(vi) 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 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,

(vii) The Company have not any such 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.