k) Provisions

A provision is recognised when the Company has a present
obligation 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.

When the Company expects some or all of the provision to
be reimbursed, for example, under an insurance contract, the
reimbursement is recognised as a separate asset, but only
when the reimbursement is virtually certain. The expense
relating to a provision is presented in the Statement of Profit
and Loss net of any reimbursement.

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.

l) Contingent liabilities

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 recognized 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 recognized
because it cannot be measured reliably. The Company does
not recognize a contingent liability but discloses its existence
in the Standalone Financial Statements.

m) Capital Commitments

Commitments are future liabilities for contractual
expenditure, classified and disclosed as follows:

(i) estimated number of contracts remaining to be
executed on capital account and not provided for; and

(ii) other non-cancellable commitments, if any, to the
extent they are considered material and relevant in the
opinion of management.

n) Retirement and other employee benefits

(i) Short term Employee Benefits

The distinction between short term and long-term
employee benefits is based on expected timing of
settlement rather than the employee’s entitlement
benefits. All employee benefits payable within twelve
months of rendering the service are classified as short¬
term benefits and are measured on an undiscounted
basis according to the terms and conditions of
employment. Such benefits include salaries, bonus,
short term compensated absences, awards, etc. and are
recognised in the period in which the employee renders
the related service, except to the extent that it can be
allocated to any Property, Plant and Equipment.

(ii) Other-employment benefits

1. Defined contribution plan

The eligible employees of the Company are
entitled to receive benefits under the Provident
Fund and Superannuation Scheme, which are
defined contribution plans. In case of Provident
Fund, both the employee and the Company
contribute monthly at a stipulated rate to the
government provident fund, while in case of
superannuation, the Company contributes to Life
Insurance Corporation of India at a stipulated rate.
The Company has no liability for future Provident
Fund or Superannuation benefits other than its
annual contributions which are recognised as an
expense on an accrual basis.

The Company recognises contribution payable
as expenditure, when an employee renders the
related services. If the contribution payable to
the scheme for services received before Balance
Sheet date exceeds the contribution already paid,
the deficit payable to the scheme is recognised as
a 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 the excess recognised
as an asset to the extent that the pre-payment will
lead to, for example, a reduction in future payment
or cash refund.

2. Defined benefit plan

The Company operates a defined benefit plan
for its employees, viz. gratuity. The present
value of the obligation or asset under such
defined benefit plans is determined based on the
actuarial valuation using the Projected Unit Credit

Method as at the date of the Balance Sheet. 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 interest cost is calculated by applying the
discount rate to the balance of the defined benefit
obligation. This cost is included in finance cost 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 as other comprehensive
income. They are included in retained earnings in
the Statement of Changes in Equity.

Changes in the present value of the defined benefit
obligation resulting from plan amendments or
curtailments are recognised immediately in profit
or loss as past service cost.

3. Benefits for long term compensated absences:

The Company treats accumulated leave expected to
be carried forward beyond twelve months, as long¬
term employee benefit for measurement purposes.
Such long-term compensated absences are
provided for based on the actuarial valuation using
the Projected Unit Credit Method at the year end.

Remeasurement gains and losses arising from
experience adjustments and changes in actuarial
assumptions are recognised in the period in which
they occur, directly as other comprehensive
income. They are included in retained earnings in
the Statement of Changes in Equity.

o) Share based payments

Eligible employees in terms of the Employees Stock Options
Scheme of the Company receive remuneration in the form of
share-based payments, whereby employees render services
as consideration for equity instruments granted (equity-
settled transactions).

The cost of equity-settled transactions is determined by
the fair value at the date when the grant is made using an
appropriate valuation model.

That cost is recognised, together with a corresponding increase
in Share-Based Payment (“SBP”) reserves in equity, over the
period in which the performance and/or service conditions
are fulfilled in employee benefits expense/vesting period. The
cumulative expense recognised for equity-settled transactions
at each reporting date until the vesting date reflects the extent

to which the vesting period has expired and the Company’s
best estimate of the number of equity instruments that will
ultimately vest. The statement of profit and loss expense or
credit for a period represents the movement in cumulative
expense recognised as at the beginning and end of that period
and is recognised in employee benefits expense.

In respect of options issued to employees of wholly owned
subsidiary, the Company has treated the charge as Deemed
Equity Investments in subsidiary.

No expense is recognised for awards that do not ultimately
vest, except for equity-settled transactions for which vesting
is conditional upon a market or non-vesting condition. These
are treated as vesting irrespective of whether or not the
market or non-vesting condition is satisfied, provided that all
other performance and/or service conditions are satisfied.

When the terms of an equity-settled award are modified,
the minimum expense recognised is the expense had the
terms had not been modified, if the original terms of the
award are met. An additional expense is recognised for any
modification that increases the total fair value of the share-
based payment transaction or is otherwise beneficial to the
employee as measured at the date of modification.

The dilutive effect of outstanding options is reflected as share
dilution in the computation of diluted earnings per share.

p) Financial instruments

A financial instrument is any contract that gives rise to a
financial asset of one entity and a financial liability or equity
instrument of another entity.

(i) Financial assets

Initial recognition and measurement of financial assets

All financial assets are recognised initially at fair value
plus, in the case of financial assets not recorded at fair
value through profit or loss, transaction costs that are
attributable to the acquisition of the financial asset.

Subsequent measurement

For purposes of subsequent measurement, financial
assets are classified in the following categories:

- Debt instruments at amortised cost

- Debt instruments at fair value through profit
or loss (FVTPL)

- Equity instruments measured at Fair Value
Through Other Comprehensive Income (FVTOCI)

Debt instruments at amortised cost

A ‘debt instrument’ is measured at the amortised cost if
both the following conditions are met:

- The asset is held within a business model
whose objective is to hold assets for collecting
contractual cash flows, and

- Contractual terms of the asset give rise on
specified dates to cash flows that are Solely
Payments of Principal and Interest (SPPI) on the
principal amount outstanding.

After initial measurement, such financial assets are
subsequently measured at amortised cost using the
Effective Interest Rate (EIR) method. Amortised cost
is calculated by considering any discount or premium
on acquisition and fees or costs that are an integral
part of the EIR. Interest income from these financial
assets is included in finance income using the effective
interest rate method.

Equity investments

All equity investments in scope of Ind AS 109 are
measured at fair value. Equity instruments which are held
for trading are classified as at FVTPL. For all other equity
instruments, the Company has made an irrevocable
election to present subsequent changes in the fair value
in the OCI. The Company makes such election on an
instrument-by-instrument basis. The classification is
made on initial recognition and is irrevocable.

If the Company decides to classify an equity instrument
as at FVTOCI, then all fair value changes on the
instrument, excluding dividends, are recognized in the
OCI. There is no recycling of the amounts from OCI to
Statement of Profit and Loss, on sale of investment.
However, the Company transfers the cumulative gain or
loss within the equity from OCI to Retained Earnings.

Equity instruments included within the FVTPL category
are measured at fair value with all changes recognized in
the Statement of Profit and Loss at each reporting date.

Dividends from such investments are recognised in
profit or loss when the Company’s right to receive
payments is established.

Derecognition

A financial asset (or, where applicable, a part of a
financial asset or part of a group of similar financial
assets) is primarily derecognised when:

- The rights to receive cash flows from the asset
have expired, or

- The Company has transferred its rights to receive
cash flows from the asset or has assumed an
obligation to pay the received cash flows in full without
material delay to a third party under a ‘pass-through’
arrangement; and either (a) the Company has

transferred substantially all the risks and rewards of
the asset, or (b) the Company has neither transferred
nor retained substantially all the risks and rewards of
the asset, but has transferred control of the asset.

When the Company has transferred its rights to
receive cash flows from an asset or has entered into
a pass-through arrangement, it evaluates if and to
what extent it has retained the risks and rewards of
ownership. When it has neither transferred nor retained
substantially all of the risks and rewards of the asset,
nor transferred control of the asset, the Company
continues to recognise the transferred asset to the
extent of the Company’s continuing involvement. In
that case, the Company also recognises an associated
liability. The transferred asset and the associated
liability are measured on a basis that reflects the rights
and obligations that the Company has retained.

Continuing involvement that takes the form of a
guarantee over the transferred asset is measured at
the lower of the original carrying amount of the asset
and the maximum amount of consideration that the
Company could be required to repay.

Impairment of financial assets

In accordance with Ind AS 109, the Company applies
expected credit loss (ECL) model for measurement
and recognition of impairment loss on the following
financial assets and credit risk exposure:

- Financial assets that are debt instruments, and
are measured at amortised cost

- Trade receivables or any contractual right to
receive cash or another financial asset

The Company follows ‘simplified approach’ for
recognition of impairment loss allowance on
Trade receivables.

The application of simplified approach does not
require the Company to track changes in credit risk.
Rather, it recognises impairment loss allowance based
on lifetime ECLs at each reporting date, right from its
initial recognition.

For recognition of impairment loss on other financial
assets and risk exposure, the Company determines
that whether there has been a significant increase in
the credit risk since initial recognition. If credit risk
has not increased significantly, 12-month ECL is used
to provide for impairment loss. However, if credit risk
has increased significantly, lifetime ECL is used. If, in
a subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition, then the

entity reverts to recognising impairment loss allowance
based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting
from all possible default events over the expected life of
a financial instrument. The 12-month ECL is a portion of
the lifetime ECL which results from default events that
are possible within 12 months after the reporting date.

ECL is the difference between all contractual cash flows
that are due to the Company in accordance with the
contract and all the cash flows that the entity expects
to receive (i.e., all cash shortfalls), discounted at the
original EIR. When estimating the cash flows, an entity
is required to consider:

- All contractual terms of the financial instrument
over the expected life of the financial instrument.
However, in rare cases when the expected life of the
financial instrument cannot be estimated reliably,
then the entity is required to use the remaining
contractual term of the financial instrument

- Cash flows from the sale of collateral held or
other credit enhancements that are integral to the
contractual terms

As a practical expedient, the Company uses a provision
matrix to determine impairment loss allowance on
portfolio of its trade receivables. The provision matrix is
based on its historically observed default rates over the
expected life of the trade receivables and is adjusted
for forward-looking estimates. At every reporting date,
the historical observed default rates are updated and
changes in the forward-looking estimates are analysed.

ECL impairment loss allowance (or reversal) recognized
during the period is recognized as income/ expense in the
Statement of Profit and Loss. This amount is reflected
under the head ‘other expenses’ in the Statement of
Profit and Loss. The Balance Sheet presentation for
various financial instruments is described below:

- Financial assets measured as at amortised cost
and contractual revenue receivables: ECL is
presented as an allowance, i.e., as an integral
part of the measurement of those assets in the
Balance Sheet. The allowance reduces the net
carrying amount. Until the asset meets write-off
criteria, the Company does not reduce impairment
allowance from the gross carrying amount.

For assessing increase in credit risk and impairment loss,
the Company combines financial instruments on the basis
of shared credit risk characteristics with the objective of
facilitating an analysis that is designed to enable significant

increases in credit risk to be identified on a timely basis.
The Company does not have any Purchased or Originated
Credit-Impaired (POCI) financial assets, i.e., financial
assets which are credit impaired on purchase/ origination.

(ii) Financial liabilities

Initial recognition and measurement

Financial liabilities are recognised initially at fair value
net of, in the case of financial liabilities not classified
as FVTPL, transaction costs that are attributable to
the issue of the financial liability. Financial assets and
financial liabilities are recognised in the Balance Sheet
when the Company becomes a party to the contractual
provisions of the instrument.

Financial liabilities at FVTPL

Financial liabilities at FVTPL include financial liabilities
held for trading and financial liabilities designated as
such upon initial recognition. Financial liabilities are
classified as held for trading if they are incurred for the
purpose of repurchasing in the near term. This category
also includes derivative financial instruments entered
into by the Company that are not designated as hedging
instruments in hedge relationships as defined by Ind
AS 109. Gains or losses on liabilities held for trading are
recognised in the Statement of Profit and Loss.

Financial liabilities designated as such upon initial
recognition at the initial date of recognition if the criteria
in Ind AS 109 are satisfied. For liabilities designated as
FVTPL, fair value gains/ losses attributable to changes
in own credit risks are recognised in OCI. These
gains/ losses are not subsequently transferred to the
Statement of Profit and Loss. However, the Company
may transfer the cumulative gain or loss within equity.
All other changes in fair value of such liability are
recognised in the Statement of Profit and Loss.

Financial liabilities at amortised cost

After initial recognition, these instruments are
subsequently measured at amortised cost using the
Effective Interest Rate (EIR) method. Gains and losses
are recognised in the Statement of Profit and Loss
when the liabilities are derecognised as well as through
the EIR amortisation process.

Amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that are
an integral part of the EIR. The EIR amortisation is included
as finance costs in the Statement of Profit and Loss.

De-recognition of financial liability

A financial liability (or a part of a financial liability) is
derecognised from the Balance Sheet when, and only
when, it is extinguished i.e., when the obligation specified
in the contract is discharged or cancelled or expired.

When an existing financial liability is replaced by another
from the same lender on substantially different terms,
or the terms of an existing liability are substantially
modified, such an exchange or modification is treated
as the derecognition of the original liability and the
recognition of a new liability. The difference in the
respective carrying amounts is recognised in the
Statement of Profit and Loss.

Offsetting of financial instruments

Financial assets and financial liabilities are offset
and the net amount is reported in the Balance Sheet
if there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realise the assets and settle the
liabilities simultaneously.

Equity shares are classified as equity. Incremental costs
directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.

q) Cash Flow Statement

Cash flows are reported using the indirect method, whereby
net profit before tax is adjusted for the effects of transactions
of a non cash nature and any deferral or accruals of past
of future cash receipts or payments. The cash flows from
regular operating, investing and financing activities of the
Company are segregated.

r) Cash and cash equivalents

Cash and cash equivalent in the Balance Sheet comprise
cash at banks and on hand and short-term deposits with
original maturity of three months or less, which are subject
to an insignificant risk of changes in value. In the Statement
of Cash Flows, cash and cash equivalents consist of cash and
short-term deposits, as defined above, net of outstanding
bank overdrafts, if any as they are considered as integral part
of the Company’s cash management.

s) Dividend

The Company recognises a liability to make cash
distributions to the equity holders of the Company when the
distribution is authorised, and the distribution is no longer
at the discretion of the Company. As per the provisions of
the Act, a distribution is authorised when it is approved by
the shareholders except in case of interim dividend which is
approved by the Board of Directors. A corresponding amount
is recognised directly in equity.

t) Earnings per share (EPS)

Basic EPS is calculated by dividing the Company’s earnings
for the year attributable to ordinary equity shareholders of
the Company by the weighted average number of ordinary
shares outstanding during the year. The earnings considered in
ascertaining the Company’s EPS comprise the net profit after
tax attributable to equity shareholders. The weighted average

number of equity shares outstanding during the year is adjusted
for events of bonus issue, bonus element in a rights issue
to existing shareholders, share split, and reverse share split
(consolidation of shares) other than the conversion of potential
vequity shares that have changed the number of equity shares
outstanding, without a corresponding change in resources.

The diluted EPS is calculated on the same basis as
basic EPS, after adjusting for the effects of potential
dilutive equity shares.

u) Segment reporting

i) Identification of segment

An operating segment is a component of a company
whose operating results are regularly reviewed by the
Company’s Chief Operating Decision Maker (CODM) to
make decisions about resource allocation and assess
its performance and for which discrete financial
information is available.

ii) Allocation of income and direct expenses and
unallocated expenses

Income and direct expenses allocable to segments
are classified based on items that are individually
identifiable to that segment. Common allocable costs
are allocated to each segment pro-rata on the basis
of revenue of each segment to the total revenue of
the Company. The remainder is considered as un¬
allocable expense.

iii) Segment policies

The Company prepares its segment information in
conformity with the accounting policies adopted for
preparing and presenting the Financial Statements of
the Company as a whole.

NOTE 5: RECENT ACCOUNTING PRONOUNCEMENTS

The Ministry of Corporate Affairs (“MCA”) has vide notification
dated May 7, 2025 notified Companies (Indian Accounting
Standards) Amendment Rules, 2025 (the ‘Rules’) which amends
certain accounting standards, and are effective from 1 April 2025
onwards. The summary of amendments is as follows -

Ind AS 21, The Effects of Changes in Foreign Exchange Rates
- These amendments provide guidance on when a currency is
considered as exchangeable, application guidance on determining
exchange ability and estimating spot rates, disclosure requirements
when the currency is not exchangeable and references to matters
contained in other Indian Accounting Standards.

Ind AS 101, First-time Adoption of Ind AS - Corresponding
amendments are made to Ind AS 101 in line with above mentioned
amendments in Ind AS 21 with respect to the entity having
functional currency that is subject to severe hyperinflation or
lacking exchange ability.

The above amendments are not applicable to the Company

NOTE 17 : ASSETS CLASSIFIED AS HELD FOR SALE

Accounting Policy

Non-current assets or disposal group are classified as held for sale if their carrying amount will be recovered principally through a sale
transaction rather than through continuing use. This condition is regarded as met only when the asset or disposal group is available for
immediate sale in its present condition subject only to terms that are usual and customary for sale of such asset or disposal group and its
sale is highly probable. 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. As at each balance sheet date, the management reviews the appropriateness of such
classification depending upon various factors including any regulatory approval.

Non-current assets or disposal group classified as held for sale are measured at the lower of their carrying amount and fair value less costs
to sell. Property, plant and equipments and intangible assets once classified as held for sale are not depreciated or amortised.

A disposal group qualifies as discontinued operation if it is a component of an entity that either has been disposed of, or is classified as
held for sale, and:

• represents a separate major line of business or geographical area of operations,

• is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations.

Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss after
tax from discontinued operations in the Statement of Profit and Loss. Additional disclosures are provided hereunder. All other notes to the
Standalone financial statements mainly include amounts for continuing operations, unless otherwise mentioned.

(e) Each holder of equity share is entitled to one vote per share and to receive interim/ final dividend as and when declared by the Board
of Directors/ at the Annual General Meeting. In the event of liquidation of the Company, the holder of equity shares will be entitled
to receive any of the 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.

* Indicates amount less than H 50,000/-

# During the year, the Company identified that, in the Financial Year 2022-23, the entire cumulative gain on sale of long-term equity investments of Swaraj Engine
Limited classified as fair value through other comprehensive income (FVTOCI) had been transferred from Other Comprehensive Income (OCI) to Retained Earnings upon
disposal of those investments. However, in accordance with Ind AS 109 - Financial Instruments, only the gain net of tax should have been transferred. Accordingly, an
amount of H 31 Crore, representing the tax effect on such gain, has been reclassified / regrouped from Retained Earnings to Other Comprehensive Income during the
year through the Statement of Changes in Equity.

Notes:

1) Security Premium:

The amount in the security premium account represents the additional amount paid by the shareholders for the issued shares in
excess of the face value of equity shares.

NOTE 24: OTHER EQUITY (CONTD..)

2) General reserve:

General reserve is created from time to time by transferring profits from retained earnings and can be utilised for purposes such as
dividend payout, bonus issue, etc .

3) Share options outstanding account:

The share option outstanding account is used to recognise the fair value of options to the employees of the Company and its Wholly
Owned Subsidiary, under the employee stock option plans of the Company, which are unvested or unexercised as on the reporting
date (Refer Note No 43)

4) Equity instruments through Other Comprehensive Income:

This reserve represents the cumulative gains and losses arrising on the fair valuation of equity instruments measured through other
comprehensive income, net of amounts reclassified to retained earnings when these equity instruments are disposed off.

5) Surplus/(Deficit) in the Statement of Profit and Loss:

This comprise of the undistributed profit after taxes.

# The deferred tax liability of H 31 crore arose from the sale of investment in Swaraj Engine Limited during the FY 2022-23. This amount was deducted from Other
Comprehensive Income (OCI) in the same year and subsequently credited to the profit and loss account under provision for tax. Simultaneously, as the OCI decreased
due to the sale of investment, it led to automatic impact on deferred tax as a result, the deferred tax was reduced twice for a single transaction.

NOTE 35: EARNINGS PER SHARE

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the Company by the weighted average
number of equity shares outstanding during the year.

Diluted EPS amounts are calculated by adjusting profit or loss attributable to ordinary equity holders of the entity, and the weighted average
number of shares outstanding, for the effects of all dilutive potential ordinary shares.

Risk Exposure & Asset Liability Matching

Provision of a defined benefit scheme poses certain risks, some of which are detailed hereunder, as companies take on uncertain
long term obligations to make future benefit payments.

(1) Liability risks

(i) Asset-Liability mismatch risk-

Risk which arises if there is a mismatch in the duration of the assets relative to the liabilities. By matching duration with
the defined benefit liabilities, the Company is successfully able to neutralise valuation swings caused by interest rate
movements.Hence companies are encouraged to adopt asset-liability management.

(ii) Discount rate risk-

Variations in the discount rate used to compute the present value of the liabilities may seem small, but in practise can
have a significant impact on the defined benefit liabilities.

(iii) Future salary escalation and inflation risk-

Since price inflation and salary growth are linked economically, they are combined for disclosure purposes. Rising
salaries will often result in higher future defined benefit payments resulting in a higher present value of liabilities
especially unexpected salary increases provided at management's discretion may lead to uncertainities in estimating this
increasing risk.

(iv) Unfunded plan risk-

This represents unmanaged risk and a growing liability. There is an inherent risk here that the Company may default on
paying the benefits inadverse circumstances. Funding the plan removes volatility in Company's financials and also benefit
risk through return on the funds made available for the plan.

NOTE 41: RELATED PARTY TRANSACTIONS

Related parties, as defined under Clause 3 of Ind AS 24 “Related Party Disclosures”, have been identified on the basis of representation
made by the Key Management Persons and taken on record by the Board of Directors. Disclosures of transactions with related
parties are as under:

(A) List of related parties as per the requirements of Ind AS 24 - Related party disclosures
(i) Subsidiaries:

Kirloskar Ferrous Industries Limited (KFIL)

Avante Spaces Limited (ASL)

NOTE 42: STOCK OPTION SCHEME

Equity Stock Appreciation Rights Plan 2019 (KIL ESARP 2019)

The Company had passed Special Resolution through Postal Ballot and approved - 'Kirloskar Industries Limited - Employee Stock
Aprreciation Right Plan 2019' ('KIL ESARP 2019') on 29 December 2019 and authorised the Board to create, offer and grant from time to
time, in one or more tranches, to employees of the Company and its subsidiary company 4,85,000 equity shares of H 10 each fully paid up.
The Company had granted an aggregate of 4,70,898 ESARs exercisable into not more than 4,85,000 equity shares of the Company face
value of H 10 each fully paid up.

In terms of the KIL ESARP 2019, the vested ESARs upon exercise shall be settled by way of allotment of equity shares. Options granted
under KIL ESARP 2019 would vest after minimum period of 1 (one) year but not later than a maximum period of 4 (four) years from the date
of grant of such options. Any option granted shall be exercisable according to the terms and conditions as determined by the Nomination
and Remuneration Committee and as set forth in the Grant Letter. The number of equity shares allotted would be the product of the
number of ESARs exercised and the proportion of appreciation in each ESAR as compared to the market price on the date of exercise. The
appreciation would be the excess of market price of the equity share over the ESAR Price in terms of the KIL ESARP 2019. No shares shall
be allotted in case there is no appreciation in the price of the shares. Upon the exercise of the options, the amount equivalent to the face
value of the shares allotted would be payable by the employees to the Company.

Under the KIL ESOP 2017 Plan, the cost of equity-settled transactions (options granted) is determined by the fair value at the date when the
grant is made using an appropriate valuation model. That cost is recognised as "employee benefits expenses” together with a corresponding
"increase in Stock Options Outstanding reserves in Equity", over the period in which the vesting conditions are fulfilled by the employees.

KIL ESOP 2017 Plan was modified and was introduced as KIL ESARP 2019.

1) For unvested options of KIL ESOP 2017, in compliance with ‘IND AS 102: Share Based Payment’:

• The Company has recognised incremental fair value of ESAR which shall be amortised over the vesting period as per
KIL ESARP 2019.

• This is in addition to the fair value of original options which will be amortised over the remaining vesting period of original
options under KIL ESOP 2017.

I Fair value of the options granted:

The Company has recorded employee stock-based compensation expense relating to the options granted to the employees on the
basis of fair value of options.

The fair value of the options granted is mentioned below as per vesting period. The fair value of the options is determined using Black-
Scholes-Merton model which takes into account the exercise price, the term of the option (time to maturity), the share price as at the
grant date and expected price volatility (standard deviation) of the underlying share, the expected dividend yield and risk-free interest
rate for the term of the option.

II Modification of KIL ESOP Plan 2017 and Implementation of KIL ESARP 2019

The incremental fair values and assumptions used for computation of such incremental fair values; and fair value of additional
ESARs granted under KIL ESARP 2019

V Employee-benefit expenses recognised in the standalone Financial Statements

The Company has recorded employee stock-based compensation of H 17.78 Crores (Previous Year: H 20.05 Crores) out of which
H 7.54 Crores (Previous Year: H 8.51 Crores ) has been recognised in the Statement of Profit and Loss and H 10.24 Crores (Previous
Year : H 11.54 Crores ) has been recognised as deemed investment in Wholly Owned Subsidiary relating to the options granted to
the employees of the Company and its Wholly Owned Subsidiary for the year ended 31 March 2025. During the year H 5.20 Crores
compensation has been reversed on account of retirement / superannuation of the directors. These adjustments have resulted in
net impact of H 2.34 Crores as reflected in Profit and Loss

NOTE 44: FAIR VALUE MEASUREMENTS (CONTD..)

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

(iv) The fair value of the quoted equity shares are based on the price quotations at reporting date.

(v) The fair value of other financial liabilities as well as other financial assets is estimated by discounting future cash flows using rates
currently available for debt on similar terms, credit risk and remaining maturities.

NOTE 45: FINANCIAL RISK MANAGEMENT

The Company's activities exposes it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is
exposed to and how the entity manages the risk.

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks
identified are systematically addressed through risk mitigation actions on a continuing basis.

(A) Market risk

Market risk is the risk of any loss in future earnings, in realisable fair values or in future cash flows that may result from a change in
the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign
currency exchange rates, equity price fluctuations, liquidity and other market changes. Future specific market movements cannot be
normally predicted with reasonable accuracy.

The Company does not have any foreign currency obligation nor does it have any borrowings. Accordingly, the Company does not
perceive any foreign currency risk or interest rate risk.

(B) Equity price risk

Equity price risk is related to the change in market reference price of the investments in equity securities. The fair value of the
Company’s investments measured at fair value through other comprehensive income and fair value through profit and loss exposes
the Company to equity price risks. These investments are subject to changes in the market price of securities.

The fair value of Company’s investment as at 31 March 2025 in quoted and unquoted equity securities was H 4,603.18 Crores (Previous
Year : H 3,240.32 Crores ) and H 122.97 Crores in quoted mutual funds (Previous Year : H 107.97 Crores). The impact of change in equity
price risk is as under:

(C) Credit risk

The Company is exposed to credit risk from its operating activities (primarily trade receivables).

I. Trade receivables

Credit risk is the risk that one party to financial instrument will cause a financial loss for the other party by failing to discharge
an obligation. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the
financial condition, current economic trends, analysis of historical bad debts, ageing of accounts receivable and forward looking
information. Individual credit limits are set accordingly. The credit period offered to customers is 30 days from the date of invoice.

Credit risk on cash and cash equivalents and other bank balances is insignificant as the Company generally invests in bank
deposits and liquid / money market mutual funds with high credit ratings.

(D) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding
through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. The
flexibility in funding requirements is met by ensuring availability of adequate inflows.

The Company had no outstanding bank borrowings as of 31 March 2025 and 31 March 2024. The working capital of the Company is
positive as at each reporting date.

NOTE 46: CAPITAL 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.

The Company's capital structure completely comprises of equity component. 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 etc.

No changes were made in the objectives, policies or processes for managing capital during the year and during the Previous Year.

NOTE 47: RATIO

The Company is termed as an Unregistered Core Investment Company (CIC) as per Reserve Bank of India Guidelines dated 13 August 2020
and is not exposed to any regulatory imposed capital requirements. Thus, the following analytical ratios are not applicable to the Company.

1) Capital to risk-weighted assets ratio (CRAR)

2) Tier I CRAR

3) Tier II CRAR

4) Liquidity Coverage Ratio

NOTE 48: RELATIONSHIP WITH STRUCK OFF COMPANIES

During the year the company has not made any transactions with companies struck off under section 248 of the Companies Act, 2013 or
section 560 of Companies Act, 1956

NOTE 49: EVENT AFTER REPORTING PERIOD

According to the management’s evaluation of events subsequent to the Balance Sheet date, there were no significant adjusting events that
occurred other than those disclosed / given effect to, in these Financial Statements as of 31 March 2025.

NOTE 50: DIVIDEND

The Board of Directors has proposed Final Dividend of H 13 ( i.e. 130%) per equity share for FY 2024-25. (Previous year Final dividend
H 13 per equity share i.e. 130%).

NOTE 51

Previous year's figures have been regrouped wherever considered necessary to make them comparable with those of the current year.
Notes forming part of the Financial Statements: Note No. 1 to 51

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

For Kirtane & Pandit LLP Atul Kirloskar Aditi Chirmule

Chartered Accountants Chairman Executive Director

Firm Registration Number: 105215W/W100057 DIN 00007387 DIN 01138984

Parag Pansare Anandh Baheti Ashwini Mali

Partner Chief Financial Officer Company Secretary

Membership Number: 117309 ACS 19944

Date: 20 May 2025 Date: 20 May 2025