2.14 Provisions and contingencies

Provisions are recognised when the Company
has a present obligation (legal or constructive)
as a result of a past event, it is probable that the
Company will be required to settle the obligation,
and a reliable estimate can be made of the amount
of the obligation.

The amount recognised as a provision is the best
estimate of the consideration required to settle the
present obligation at the end of the reporting period,
taking into account the risks and uncertainties
surrounding the obligation. When a provision is
measured using the cash flows estimated to settle
the present obligation, its carrying amount is the
present value of those cash flows (when the effect
of the time value of money is material).

Asset retirement obligations (ARO) are provided
for those operating lease arrangements where the
Company has a binding obligation at the end of the
lease period to restore the leased premises in a
condition similar to inception of lease.

Asset retirement obligation are provided at the
present value of expected costs to settle the
obligation using estimated cash flows and are
recognized as part of the cost of the particular
asset. The cash flows are discounted using
incremental borrowing rate that reflects the risks
specific to the site restoration obligation. The
unwinding of the discount is expensed as incurred
and recognized in the Standalone Statement of
Profit and Loss as a finance cost. The estimated
future costs of decommissioning are reviewed
annually and adjusted as appropriate. Changes in
the estimated future costs or in the discount rate
applied are added to or deducted from the cost of
the asset.

Contingent liabilities are disclosed when there
is a possible obligation arising from past events,
the existence of which will be confirmed only by
the occurrence or non occurrence of one or more
uncertain future events not wholly within the control
of the Company or a present obligation that arises
from past events where it is either not probable that
an outflow of resources will be required to settle or
a reliable estimate of the amount cannot be made.

2.15 Financial instruments

Financial assets and financial liabilities are
recognised when the Company becomes a party to
the contractual provisions of the instruments.

The Company determines the classification of its
financial instruments at initial recognition.

2.16 Financial assets

2.16.1 Initial recognition and measurement

At initial recognition, financial asset (except
trade receivables which do not contain a
significant financing component are measured
at transaction price) is measured at its fair
value plus, in the case of a financial asset not
at fair value through profit or loss, transaction
costs that are directly attributable to the
acquisition of the financial asset. Transaction
costs of financial assets carried at fair value
through profit or loss are expensed in the
Standalone Statement of Profit and Loss.

2.16.2 Subsequent measurement

All recognised financial assets are
subsequently measured in their entirety at

either amortised cost or fair value, depending
on the classification of the financial assets.

The Company classifies its financial assets in
the following measurement categories:

• those to be measured subsequently
at fair value (either through other
comprehensive income, or through
Profit and Loss), and

• those measured at amortised cost.

The classification depends on the entity's
business model for managing the financial
assets and the contractual terms of the cash
flows.

For assets measured at fair value, gains and
losses will either be recorded in Profit and Loss
or other comprehensive income. Investments
in debt mutual funds are measured at fair
value through Profit and Loss as per the
business model and contractual cash flow
test.

2.16.3 Impairment of financial assets

The Company assesses at each Balance
Sheet date whether a financial asset or a
Company of financial assets is impaired.
Ind AS 109 requires expected credit losses
to be measured through a loss allowance.
The Company recognises lifetime expected
losses for trade receivables that do not
constitute a financing transaction. For other
financial assets carried at amortised cost
the Company assesses, on a forward looking
basis, the expected credit losses associated
with such assets and recognises the same in
the Standalone Statement of Profit and Loss.

2.16.4 Cash and cash equivalents

For the purpose of presentation in the
Standalone Statement of Cash Flows, cash
and cash equivalents includes cash on hand,
deposits held at call with financial institutions,
other short-term, highly liquid investments,
other than which are lien against borrowings,
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, and

book overdrafts. Bank overdrafts are shown
within borrowings in current liabilities in the
Standalone Balance Sheet.

2.16.5 Derecognition of financial assets

The Company derecognises financial assets in
accordance with the principles of Ind AS 109
which usually coincides receipt of payment or
write off of the financial asset.

2.17 Financial liabilities and equity instruments

2.17.1 Classification of debt or equity

Debt and equity instruments issued by a
Company entity are classified as either
financial liabilities or as equity in accordance
with the substance of the contractual
arrangements and the definitions of a financial
liability and an equity instrument.

2.17.2 Equity instruments

An equity instrument is any contract that
evidences a residual interest in the assets of
an entity after deducting all of its liabilities.
Equity instruments issued by a Company entity
are recognised at the proceeds received, net
of direct issue costs.

2.17.3 Financial liabilities

Classification : The Company classifies all
financial liabilities as subsequently measured
at amortised cost.

Initial recognition and measurement : All

financial liabilities are recognised initially
at fair value and, in the case of loans and
borrowings and payables, net of directly
attributable transaction costs.

Loans and borrowings : After initial
recognition, interest-bearing loans and
borrowings are subsequently measured at
amortised cost using the Effective Interest
Rate (EIR) method. Gains and losses are
recognised in the Standalone Statement
of Profit and Loss when the liabilities are
derecognised. Amortised cost is calculated by
taking into account any discount or premium
on acquisition and transactions costs. The EIR
amortisation is included as finance costs in
the Standalone Statement of Profit and Loss.

2.17.4 Foreign exchange gains and losses

For financial liabilities that are denominated
in a foreign currency and are measured at
amortised cost at the end of each reporting
period, the foreign exchange gains and losses
are determined based on the amortised cost
of the instruments and are recognised in the
Standalone Statement of Profit and Loss.

2.17.5 Derecognition of financial liabilities

The Company derecognises financial liabilities
when, and only when, the Company's
obligations are discharged, cancelled or have
expired.

2.18 Earnings per share

Basic earnings per share is computed by dividing
the profit / (loss) attributable to the shareholders of
the Company by the weighted average number of
equity shares outstanding during the period.

Equity shares which are issuable upon the
satisfaction of certain conditions resulting from
contractual arrangements / shareholder agreement
are considered outstanding and included in the
computation of basic earnings per share from
the date when all necessary conditions under the
contract have been satisfied as on the Balance
Sheet date.

Diluted earnings per share is computed by adjusting,
the profit/ (loss) for the period attributable to the
shareholders and the weighted average number of
shares considered for deriving basic earnings per
share, for the effects of all the shares that could
have been issued upon conversion of all dilutive
potential shares. The dilutive potential shares
are adjusted for the proceeds receivable had the
shares been actually issued at fair value. Further,
the dilutive potential shares are deemed converted
as at beginning of the period, unless issued at a
later date during the period.

2.19 Investments

Long-term investments (investment in subsidiaries)
are carried individually at cost less provision for
diminution, other than temporary, in the value of
such investments.

On disposal of an investment, the difference
between the carrying amount and the disposal

proceeds, net of expenses, is recognised in the
Standalone Statement of Profit and Loss. When
disposing of a part of the holding of an individual
investment, the carrying amount to be allocated to
that part is to be determined on the basis of the
average carrying amount of the total investment.

3 KEY SOURCES OF ESTIMATION

UNCERTAINTIES AND CRITICAL

JUDGEMENTS

In applying the Company's accounting policies,
which are described in note 2 above, the directors
are required to make judgements (other than those
involving estimations) that have a significant impact
on the amounts recognized and to make estimates
and assumptions about the carrying amounts of
assets and liabilities that are not readily apparent
from other sources. The estimates and associated
assumptions are based on historical experience and
other factors that are considered to be relevant.
Actual results may differ from these estimates.

The estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the period
in which the estimate is revised if the revision
affects only that period, or in the period of the
revision and future periods if the revision affects
both current and future periods.

3.1 Critical judgements in applying the
Company's accounting policies

3.1.1 Lease term - Company as a Lessee

I nd AS 116 requires lessee to determine the
lease term as the non-cancellable period of
a lease adjusted with any option to extend or
terminate the lease, if the use of such option
is reasonably certain.

The Company makes an assessment on the
expected lease term on a lease-by-lease
basis and thereby assesses whether it is
reasonably certain that any options to extend
or terminate the contract will be exercised.
In evaluating the lease term, the Company
considers factors such as any significant
leasehold improvements undertaken over the
lease term, costs relating to the termination of
the lease and the importance of the underlying
asset to the Company's operations taking into
account the location of the underlying building

and the availability of suitable alternatives.
The Company has ascertained lease term as
non-cancellable term."

3.1.2 Capitalisation of fit out period

Cost (depreciation on right of use asset,
interest expense of lease liability, electricity
charges, building maintenance charges,
housekeeping & security charges, project
and design related employee cost) for the
expected fit-out period is capitalised as
part of leasehold improvement, considering,
this cost is attributable to bring the asset in
necessary condition for its intended use. The
fit out period has been determined by the
management basis the historical experience
and the size and complexities involved for
development of property to make them
available for intended use.

3.1.3 Incremental borrowing rate

The initial recognition of lease liabilities at
present value requires the identification of
an appropriate discount rate. The Company
has determined the incremental borrowing
rate based on considerations specific to the
leases by taking consideration of the risk
free borrowing rates as adjusted for country
/ Company specific risk premiums (basis the
readily available data points). The Company is

considering fixed deposit rates as appropriate
discount rates to get fair value of financials
assets.

3.2 Key sources of estimation uncertainty

3.2.1 Taxes

Deferred tax assets are recognised for the
unused tax losses for which there is probability
of utilisation against the future taxable
profit. 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, future tax planning strategies
and recent business performances and
developments (refer note 13).

3.2.2 Useful life of property, plant and equipment

As described at note 2.11.1 above, the
Company reviews the estimated useful lives
of PPE at the end of each reporting year.
After considering market conditions, industry
practice, technological developments and
other factors, the Company determined
that the current useful lives of its PPE
remain appropriate. Uncertainties in these
estimate relate to technical and economic
obsolescence that may change the utility of
assets.

5.1. Building include property taken from landlords for developing co-working spaces along with guest houses and
related fit-out cost.

5.2. Equipment majorly comprises of UPS and electronic/electrical equipment taken on lease.

5.3. The Company periodically reassesses the lease term for its lease arrangements. Lease reassessment involves
re-evaluating any options to extend or terminate the lease considering factors such as the importance of the
underlying asset to the Company's operations taking into account the location and size of the underlying building
and the availability of suitable alternatives. During the year ended March 31, 2024, the Company has reassessed
lease term for certain properties to non-cancellable period. Pursuant to this, lease liabilities are remeasured to
reflect change in lease term with a corresponding adjustment to the ROU asset or Standalone Statement of Profit
and Loss, if the ROU asset has been reduced to zero.

Note:

12.1. It includes cash collateral, in relation to borrowings, amounting to ' Nil (March 31, 2024 - ' 7.5 million).

12.2. It includes deposits against lien/bank guarantee of ' 55.00 million (March 31, 2024 - ' 136.69 million).

12.3. It includes cash collateral, in relation to borrowings, amounting to ' 7.5 million (March 31, 2024 - ' 7.5 million).

12.4. The Company has incurred share issue expenses in connection with the proposed Initial Public Offering (IPO) of
equity shares. In accordance with the Offer Agreement entered between the Company and the selling shareholders,
the selling shareholders shall reimburse the share issue expenses in proportion to the respective shares offered for
sale. Accordingly, the Company will recover the expenses incurred amounting to ' 31.93 million in connection with the
issue on completion of IPO.

15.2. Includes IPO expense of ' 84.07 million (March 31, 2024: Nil) which will be adjusted with securities premium at
the time of issue of shares in accordance with requirement of Section 52 of the Companies Act, 2013.

15.3. Operating lease arrangements (as a lessor)

Operating leases, in which the Company is the lessor, relate to co-working space given by the Company on lease
with lease term (i.e. non cancellable term or contract term, based on the customer portfolio).

The Company enters into arrangements with customers for providing co-working spaces wherein the right to use
the assets is given. However, as the title to the assets and the significant risks associated with the operation and
maintenance of these assets remains with the Company, such arrangements are recognised as operating lease.
Revenue from leased out co-working space under an operating lease is recognized on a straight line basis over
lease term.

19.4.1 Shareholding as on March 31,2024 and thereafter, is based on list of promoters identified/classified pursuant
to board resolution dated March 26, 2024. Promoter here means Promoter defined under Companies Act, 2013.

19.5. During the year ended March 31, 2025, the Shareholders of the Company increased the authorised share capital
of the Company to ' 1,400.00 million divided into 120,000,000 equity shares of ' 10/- each and 20,000,000
preference shares of ' 10/- each.

19.6 During the year ended March 31, 2025, the Company has allotted 3,716,551 (March 31, 2024: 1,322,000) equity
shares under private placement on preferential basis having face value ' 10 each equity share, issued at a price of
' 269 per equity share (including share premium of ' 259/- each equity share) (March 31, 2024: ' 269 per equity
share (including share premium of ' 259/- each equity share)), ranking pari passu with existing equity shares.

19.7 During the year ended March 31, 2025, the Company has allotted 10,707 (March 31, 2024: 1,219,776) cumulative
convertible preference shares having face value ' 10 each, issued at a price of ' 269 per cumulative convertible
preference shares (including share premium of ' 259/- each cumulative convertible preference shares) (March 31,
2024: ' 269 per cumulative convertible preference shares (including share premium of ' 259/- each cumulative
convertible preference shares)).

19.8. During the year ended March 31, 2025, the Company has converted 19,610,398 CCPS of face value of ' 10
each held by Space Solutions India Pte. Limited (formerly known as Lisbrine PTE. LTD.) (SSIPL) into 19,610,398
equity shares of face value of ' 10 each as per the terms and conditions stated in articles of association and the
Shareholder's agreement.

20.1. Securities premium

Securities premium is used to record the premium on issue of shares. The reserves are utilised in accordance with
provisions of The Companies Act, 2013.

20.2. Instruments classified as equity

20.2.1 The Company has issued 18,379,915 cumulative convertible preference share ("CCPS") having a face value of
' 10 each on October 23, 2019 with reference to the investment agreement with Space Solutions India Pte Ltd
(Formerly known as Lisbrine PTE. LTD.) dated October 4, 2019. Preference shareholder is entitled to receive
dividend subject to recommendation of Board of Directors and approval of equity shareholders. These CCPS
carry one vote per share in terms of the agreement.

1. The shareholder shall be entitled to receive a cumulative fixed preferential dividend per annum for each
cumulative convertible preference shares held based on the following coupon rate:

i. 0.01% of the Initial Subscription Price per share on the first anniversary;

ii. 0.50% of the Initial Subscription Price per share on the second anniversary;

iii. 1.00% of the Initial Subscription Price per share on the third anniversary;

iv. 2.00% of the Initial Subscription Price per share on the fourth anniversary;

v. 4.00% of the Initial Subscription Price per share on fifth anniversary and every anniversary thereafter
until conversion of the cumulative convertible preference shares to ordinary shares in the Company.

2. At any time up to 20 years from the date of the agreement, the preference shareholder shall have the right,
at its option and sole and absolute discretion, to convert all or part of its cumulative convertible preference
shares then outstanding into ordinary shares.

3. All the cumulative convertible preference shares then outstanding shall be converted into ordinary shares at
a minimum ratio of 1 cumulative convertible preference share to 1 ordinary share conversion rate immediately:

(a) prior to the consummation of a Qualified Event or

(b) in the event there is a binding offer for a purchase of all of the Shares of the Company and such offer
meets the yield threshold.

4. Each cumulative convertible preference share, subject to conversion, shall be converted into such number of
fully paid ordinary shares as is determined by dividing the initial subscription price per share (as appropriately
adjusted for any subdivisions, consolidations, share dividends or similar recapitalisations) by the then
applicable conversion price per cumulative convertible preference share and no additional consideration
shall be payable upon such conversion.

5. As these cumulative convertible preference shares are perpetual in nature and ranked senior only to the
equity share capital of the Company and the Company does not have any redemption obligation i.e. these
instruments have to be converted into equity share of the Company, thus these shares are considered as
equity instruments.

20.2.2 On March 30, 2024, and April 18, 2024, the Company issued an additional 1,219,776 and 10,707 Class A
cumulative convertible preference shares, respectively, each with a face value of ' 10. These issuances are in
accordance with the investment agreement with Space Solutions India Pte Ltd (formerly known as Lisbrine PTE.
LTD.) dated March 27, 2024. Preference shareholder is entitled to receive dividend subject to recommendation

of Board of Directors and approval of equity shareholders. These CCPS carry one vote per share in terms of the

agreement.

Terms of issue of this cumulative convertible preference shares are

1. The Company shall not declare or pay any dividends to holders of Ordinary Shares until all the Class A
Convertible Preference Shares held by the Investor have been converted to Ordinary Shares of the Company.

2. In the event a Qualifying IPO is not effected within twenty four (24) months from the date of execution of the
Agreement, Space Solutions India Pte Ltd (Formerly known as Lisbrine PTE. LTD.) shall be entitled to receive
a cumulative fixed preferential dividend ("Preferential Dividend") per annum for each Class A Convertible
Preference Share held by Space Solutions India Pte Ltd (Formerly known as Lisbrine PTE. LTD.) based on the
Initial Subscription Price Per Share equal or equivalent to 5.00% of the Initial Subscription Price Per Share on
the second (2nd) anniversary from the date of the Agreement for every six (6) months since the execution of
the Agreement and for every six (6) months thereafter until conversion of the Class A Convertible Preference
Shares to Ordinary Shares in the Company, (as appropriately adjusted for any subdivisions, consolidations,
share dividends or similar recapitalisations).

3. Any Preferential Dividend (if any) shall be computed based on the Initial Subscription Price Per Share that
is, in aggregate, equivalent to (and computed based on) INR equivalent to US$4Mn to be converted INR
exchange rate of the receiving bank as at the time of receipt which represents the amount invested in the
Company by the Investor on Completion.

4. The right of the Investor to receive such dividends shall rank senior and prior to and in preference to the
dividend rights of the holders of Ordinary Shares in the Company.

5. Subject to the foregoing, no dividends or distributions (in whatever form) shall be declared or paid to the
holders of the Ordinary Shares unless the Investor first receives or simultaneously receives in full a pro rata
share of such dividends on an as-converted basis.

6. In the event of consummation of a Qualified Fund Raise, the Preferential Dividend shall be immediately
adjusted to match the dividend policy agreed in the definitive agreement arising from the Qualified Fund
Raise subject to (i) the agreement of all parties including the Investor, the Founders and the new investors
or (ii) if no agreement is reached for any reason, then the Investor shall be entitled to a minimum of two per
cent. (2%) of the Initial Subscription Price Per Share per annum for each Class A Convertible Preference
Share held by the Investor.

7. All the Class A convertible preference shares then outstanding shall be converted into ordinary shares at a
minimum ratio of 1 Class A convertible preference share to 1 ordinary share conversion rate immediately:

(a) prior to the consummation of a Qualified Event or

(b) in the event there is a binding offer for a purchase of all of the Shares of the Company and such offer
meets the yield threshold.

8. Each Class A Convertible Preference Share, subject to conversion, shall be converted into such number of
fully paid ordinary shares as is determined by dividing the initial subscription price per share (as appropriately
adjusted for any subdivisions, consolidations, share dividends or similar recapitalisations) by the then
applicable conversion price per Class A convertible preference share and no additional consideration shall
be payable upon such conversion.

9. In the event of a Non-Qualified Event, the net proceeds (after deductions such as expenses and creditor
payments) will be distributed as follows:

First: The Investor receives the greater of:

(i) 100% of the original investment plus any unpaid dividends on the Class A Convertible Preference Shares, or

(ii) the amount the Investor would get if the Class A Convertible Preference Shares were converted to Ordinary
Shares before the event (Convertible Preference Liquidity Amount).

If assets are insufficient, the Company will distribute assets proportionally to the Investor.

Second: After the Investor's full Convertible Preference Liquidity Amount is paid, remaining funds will be
distributed pro-rata among the Ordinary Shareholders. The Investor is excluded from this second distribution
unless Class A Shares were converted to Ordinary Shares before the event."

20.3. Share Warrants

The Company had issued 850,000 share warrants of ' 260 each per warrant ("Warrant Subscription Price") for
an aggregate consideration of ' 221.00 million on March 13, 2023 with reference to the warrant subscription
agreement with Deutsche Bank,A.G, London Branch dated March 2, 2023. The warrant consideration was paid in
the following manner:

1. ' 55.25 million was paid by the warrant holder on March 13, 2023 as consideration for subscribing to the
Warrants ("Warrant Subscription Amount").

2. ' 165.75 millions was paid by warrant holder on date of exercising the option of converting the entire warrants
into equity shares of the Company i.e. August 02, 2024 in accordance with the terms set forth in the warrant
subscription agreement.

20.4. Share based payment reserve (refer note 43)

This relates to stock options granted by the Company to certain eligible employees under ESOP scheme named
Smartworks Coworking Spaces Limited Employee Share Option Plan 2022 and as ammended thereafter.

20.5. Retained Earnings

Retained earnings reflect surplus / deficit after taxes in the Standalone Statement of Profit or Loss. The amount
that can be distributed by the Company as dividends to its equity shareholders is determined based on the
balance in this reserve and also considering the requirements of the Companies Act, 2013.

Note:

33.1. For the year ended March 31, 2024, the cumulative convertible preference shares classified as equity instruments
are included as a part of Basic and Diluted EPS computation as these can be converted to equity shares at any point
of time (refer note 20.2).

33.2. For the year ended March 31, 2025, employee stock options granted to certain eligible employees under ESOP
scheme and share warrants (refer note 20.3) has not been considered in computing Diluted EPS since options and
warrants are anti-dilutive in nature.

| 35. SEGMENT REPORTING

The Company's primary business segment involves developing and licensing fully serviced office spaces in business
centres. The Board of Directors of the Company, which has been identified as being the Chief Operating Decision Maker
(CODM), evaluates the Company performance, allocate resources based on the analysis of the various performance
indicator of the Company as a single unit of coworking spaces. Therefore there are no separate reportable business
segments as per Ind AS 108- "Operating Segments".The Company does not have any single external customer
contributing to 10% or more of the company's revenue

Geographical Information:

There are no revenue from external customers and non current assets attributed to countries other than India.

| 36. EMPLOYEE BENEFIT PLANS
Defined contribution plans

The Company makes provident fund and employee state insurance contribution to a defined contribution retirement
benefit plan for qualifying employees. The Company's contribution to the Employees provident fund and Employee
state insurance is deposited with the Regional Provident Fund Commissioner and Employee State Insurance
Corporation, respectively. Under the scheme, the Company is required to contribute a specified percentage of payroll
cost to the retirement benefit scheme to fund the benefits. The Company has recognised the following amounts in the
Standalone Statement of Profit and Loss in the following years:

Gratuity

a) The Company offers its employees defined-benefit plans in the form of a gratuity scheme. Benefits under the
defined benefit plans are based on years of service and the employee's compensation (immediately before
retirement). Benefits payable to eligible employees of the Company with respect to gratuity, a defined benefit
plan is accounted for on the basis of an actuarial valuation as at the reporting date.

b) This plan typically expose the Company to actuarial risk such as: interest rate risk, longevity risk and salary risk.
Interest risk

A decrease in the bond interest rate will increase the plan liability.

Longevity 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 liability is calculated by reference to the future salaries of plan
participants. As such, an increase in the salary of the plan participants will increase the plan's liability.

(c) Significant actuarial assumptions

Notes:

i) The above sensitivity analyses 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.

ii) The methods and types of assumptions used in preparing the sensitivity analyses did not change compared
to previous year.

38.1.1 Fair values hierarchy

Financial assets and financial liabilities are measured at fair value in the financial statement and are grouped into
three Levels of fair value hierarchy. The three Levels are defined based on the observability of significant inputs
to the measurement, as follows:

Level 1: quoted prices (unadjusted) in active markets for financial instruments

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly.

Level 3: unobservable inputs for the asset or liability.

38.2. Financial risk management objectives

While ensuring liquidity is sufficient to meet the Company's operational requirements, the Company's risk
management committee also monitors and manages key financial risks relating to the operations of the Company
by analysing exposures by degree and magnitude of risks. These risks include market risk (including currency
risk, interest risk and price risk), credit risk and liquidity risk.

38.2.1. Market risk

38.2.1.1. Currency risk

Currency risk is the risk or uncertainty arising from possible currency movements and their impact on the future
cash flows of a business. There are no material currency risk affecting the financial position of the Company as
there are no material transactions in currency other than functional currency of the Company.

38.2.1.2. Interest 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'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. The Company manages its interest
rate risk by having a balanced portfolio of fixed and floating rate loans and borrowings keeping in view of current
market scenario.

38.2.1.4. Credit risk management

Credit risk is the risk that a counterparty fails to discharge its obligation to the Company under a financial
instrument or customer contract leading to a financial loss. The Company is exposed to credit risk mainly with
respect to trade receivables, investment in mutual funds, bank deposits and bank balances.

Trade receivables

The trade receivables of the Company are typically non-interest bearing and derived from sales made to a
large number of independent customers. As the customer base is widely distributed both economically and
geographically, there is minimal concentration of credit risk. The credit period provided by the Company to its
customers generally ranges from 7 days.

The management performs ongoing assessment of trade receivables for each customer basis the terms and
conditions of each contract to identify the material breach. Facts and circumstances relevant to each customer
are reviewed by the management to assess credit risk. Receivables are credit impaired to the extent unsecured
and there is no convincing evidence establishing collection of consideration in near future.

The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there
is no realistic prospect of recovery. Where the financial asset has been written-off, the Company continues to
engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are
recognised in the Standalone Statement of Profit and Loss.

Other financial instruments and bank deposits

The Company's treasury, in accordance with the board approved policy, maintains its cash and cash equivalents,
deposits and investment in mutual funds with banks, financial and other institutions, having good reputation, past
track record, and high credit rating. Similarly, counter-parties of the Company's other receivables carry either no

or very minimal credit risk. Further, the Company reviews the credit-worthiness of the counter-parties (on the
basis of its ratings, credit spreads and financial strength) of all the above assets on an on-going basis, and if
required, takes necessary mitigation measures.

38.2.1.5. Liquidity risk management

The Company manages liquidity risk by maintaining sufficient cash and cash equivalents including bank deposits
and availability of funding through an adequate amount of committed credit facilities, security deposits from
customers to meet the obligations when due. Management monitors rolling forecasts of liquidity position and
cash and cash equivalents on the basis of expected cash flows. In addition, liquidity management also involves
projecting cash flows considering level of liquid assets necessary to meet obligations by matching the maturity
profiles of financial assets & liabilities and monitoring balance sheet liquidity ratios.

The Company has incurred loss for the year ended March 31, 2025 of ' 617.51 million (' 468.85 million for the
financial year ended March 31, 2024) and as at that date, the current liabilities exceeded its current assets by '
9,534.28 million (' 6,900.00 million as at March 31, 2024). The Company has a long term lease agreements with
its customers, has generated positive cash flows from its operation, retained its existing customers and utilising
the security deposits which are classified as current liabilities. Additionally, the Company has initiated plans to
relocate to larger business centers to enhance cost efficiency and revenue potential and has obtained external
borrowings as needed.

The Management have made an assessment of the Company's ability to continue as a going concern and have
no reason to believe the Company will not be a going concern in the year ahead considering external funding
arrangements with banks and other aforesaid initiatives.

The following tables detail the Company's remaining contractual maturity for its non-derivative financial liabilities
with agreed repayment periods. The information included in the tables have been drawn up based on the
undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required
to pay. The tables include both interest and principal cash flows.

| 39 CAPITAL MANAGEMENT

The purpose of the Company's capital management is to maintain an optimal capital structure to reduce the Cost of
capital.

Management monitors capital on the basis of the carrying amount of equity and net debt (adjusted for cash and cash
equivalents) as presented on the face of Standalone Balance Sheet.

The Company manages its capital structure and makes adjustments to it in the light of changes in economic conditions
and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company
may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.

Notes:

39.1 Net debt does not include lease liabilities.

| 40 The Board of Directors of the Company have not declared any dividend and accordingly no apportionment has
been made with respect to dividend for cumulative convertible preference shares amounting to ' 77.16 million till
the period ended August 13, 2024 (March 31, 2024 - ' 50.94 million).

Pursuant to "Waiver cum Amendment Agreement" between the Company and Space Solutions India Pte Ltd
(formerly known as Lisbrine PTE. LTD.) (SSIPL) dated August 13, 2024, the CCPS holder waived off its rights to
receive cumulative fixed preferential dividend in respect of the convertible preference share held by the Investor.

During the year ended March 31, 2025, the Company has converted 19,610,398 CCPS of face value of ' 10
each held by Space Solutions India Pte. Limited (formerly known as Lisbrine PTE. LTD.) (SSIPL) into 19,610,398
equity shares of face value of ' 10 each as per the terms and conditions stated in articles of association and the
Shareholder's agreement.

| 41 The Company did not grant any loan or advance in the nature of loans to any of its promoters, directors, KMPs
or other related parties, as defined under the Companies Act, 2013, in the current year and in the previous year.

| 43 SHARE BASED PAYMENTS
Employee share option plan

The Company granted employee stock options to certain eligible employees under ESOP scheme named Smartworks
Coworking Spaces Limited Employee Share Option Plan 2022 and as amended thereafter.

The ESOP plan was duly approved by the board of directors at their meeting held on July 31, 2024 and the shareholders
of the Company by way of resolution passed at their Annual General Meeting held on August 3, 2024 for granting of
aggregate 317,500 shares. These options would vest generally over 2 years from the date of grant as per the letter of
grant executed between the Company and its employees. The Vested options will be exercised by the employee over
2 years from the vesting date which will be settled in equity shares of the Company. In determining which Employees
may be granted Options and for determining the quantum of Options to be granted, the Committee/Board will take
into account whether Options will provide additional incentive to Employees, whether such Options will promote the
success of the relevant Company's business, the potential for future contribution to the relevant Company, integrity,
number of employment years and any other factor(s) as deemed appropriate by the Committee/Board.

44 AUDIT TRAIL

MCA vide its notification number G.S.R. 206(E) dated March 24, 2021 (amended from time to time) in reference to the
proviso to Rule 3 (1) of the Companies (Accounts) Amendment Rules, 2021, introduced the requirement w.e.f. April 01,
2023, to only use such accounting software which has a feature of recording audit trail of each and every transaction.

The Company has assessed IT applications including supporting applications considering the guidance provided
in "Implementation guide on reporting on audit trail under rule 11(g) of the Companies (Audit and Auditors) Rules,
2014 (Revised 2024 edition)" issued by the Institute of Chartered Accounts of India in February 2024, and identified
applications that are relevant for maintaining books of accounts. During the year ended March 31, 2025, the Company
has migrated to new accounting software from April 01, 2024. The Management had implemented audit trail feature
over accounting software and one supporting software from December 26, 2024 and December 10, 2024, respectively.

During such year/period, as applicable, audit trail feature has operated effectively and there were no instances of audit
trail feature being tampered with.

Furthermore, audit trail has been preserved by the Company as per the statutory requirements for record retention.

46 In financial year 2021, certain anonymous mails/letters were received by Company's various stakeholders,
wherein one of the shareholders of the Company appointed independent advocates ("Independent Advocates")
for conducting financial / legal due diligence of such anonymous allegation mails / letters. Based on the due
diligence performed by Independent Advocates and after considering the relevant underlying evidence, it was
concluded that all such allegations appear to be baseless and devoid of any substance other than one matter
which is sub-judice.

Further, the Company noted that certain anonymous and frivolous allegation mails / letters ("communications")
have been received by the Company including through SEBI and merchant bankers, till the date of signing of
these Standalone Financial Statements, having unsubstantiated allegations, inter alia, of irregularities in operation
of the Company, illegal / unexplained source of funds, non-payment of borrowings and involvement in abetment
to suicide by certain of its promoters, lack of internal financial controls, discrepancies /illegal activities of the
Company, hiding of financial and operational liabilities of the Company, ongoing investigations by various
regulatory authorities against the Company, certain of its promoters and certain companies in the Company.

The Board of Directors of the Company have considered and analysed the communications and concluded that
such allegations are baseless and frivolous and there is no impact on the operations and the Standalone Financial
Statements of the Company.

| 47 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 have not traded or invested in Crypto currency or Virtual Currency.

(iii) 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.

(iv) 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.

(v) The Company has not entered into 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).

(vi) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by
the Company.

(vii) The Company did not have any long-term contracts including derivative contracts for which there were any
material foreseeable losses.

(viii) The details of loans, guarantees and investments under Section 186 of the Companies Act, 2013 read with the
Companies (Meetings of Board and its Powers) Rules, 2014 are as follows :

(a) details of investments in subsidiaries made by the Company are disclosed in Note 9.

(b) details of loans given by the Company to subsidiaries are disclosed in Note 11.

For and on behalf of the Board of Directors of
Smartworks Coworking Spaces Limited

(Formerly known as Smartworks Coworking Spaces Private Limited)

Sd/- Sd/-

Neetish Sarda Harsh Binani

Managing Director Wholetime Director

DIN: 07262894 DIN: 07717396

Place: Gurugram Place: Gurugram

Date: June 13, 2025 Date: June 13, 2025

Sd/- Sd/-

Sahil Jain Punam Dargar

Chief Financial Officer Company Secretary (M. No.- A56987)

Place: Gurugram Place: Kolkata

Date: June 13, 2025 Date: June 13, 2025