h) Provisions, Contingent liabilities and Contingent Assets

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events, it is probable that an
outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are not recognised for
future operating losses.

Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the
end of the reporting period.

A present obligation that arises from past events where it is neither probable that an outflow of resources will be required to settle nor a
reliable estimate of the amount cannot be made, is disclosed as a contingent liability. Contingent liabilities are also 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. Contingent assets are not recognised in financial statements since
this may result in the recognition of income that may never be realised. However, when the realisation of income is virtually certain, then the
related asset is not a contingent asset and is recognised.

i) Foreign currency translation

Items included in the financial statements of each of the Company's entities are measured using the currency of the primary economic
environment in which the entity operates (‘the functional currency'). The financial statements are presented in Indian rupee (INR), which is
Vallabh Steels Limited functional and presentation currency.

Foreign currency translations are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign
exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities
denominated in foreign currencies at year end exchange rates are generally recognised in profit or loss.

j) Revenue recognition

Revenue is measured at the fair value of the consideration received or receivables. Amounts disclosed as revenue are inclusive of excise duty
and net of returns, trade allowances, rebates, discounts, value added taxes.

The Company recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow
to the Company and specific criteria have been met for each of the Company's activities as described below.

Sale of goods

Sales are recognised when substantial risk and rewards of ownership are transferred to customer as per the terms of the contract, there is no
continuing managerial involvement with the goods. The Company retains no effective control of the goods transferred to a degree usually
associated with ownership and no significant uncertainty exists regarding the amount of the consideration that will be derived from the sale of
goods., in case of domestic customer, sales take place when goods are dispatched or delivery is handed over to transporter, in case of export
customers, sales takes place when goods are shipped onboard based on bill of lading.

Revenue from Services

Revenue from services is recognised in the accounting period in which the services are rendered.

Other operating revenue - Export incentives

Revenue in respect of export incentives is recognised when such incentives accrue upon export of goods.

k) Income Tax

The income tax expense or credit for the period is the tax payable on the current period's taxable income based on the applicable income tax
rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax
losses.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements. Deferred income tax is determined using tax rates (and laws) that have been
enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is
realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it is probable that future taxable
amounts will be available to utilise those temporary differences and losses.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the
deferred tax balances relate to same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable
right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income
or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

l) Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash in hand and other bank balances.

m) Trade receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less
provision for impairment if any. The EIR is the rate that discounts estimated future cash income through the expected life of financial
instrument.

n) Financial instruments

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

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or
issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss and
ancillary costs related to borrowings) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate,
on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through
profit or loss are recognised immediately in Statement of Profit and Loss.

Classification and Subsequent Measurement: Financial Assets

The Company classifies financial assets as subsequently measured at amortised cost, fair value through other comprehensive income
(“FVOCI”) or fair value through profit or loss (“FVTPL”) on the basis of following:

• the entity's business model for managing the financial assets and

• the contractual cash flow characteristics of the financial asset.

Amortised Cost:

A financial asset shall be classified and measured at amortised cost if both of the following conditions are met:

• the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and

• the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the
principal amount outstanding.

Fair Value through OCI:

A financial asset shall be classified and measured at fair value through OCI if both of the following conditions are met:

• the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial
assets and

• the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the
principal amount outstanding.

Fair Value through Profit or Loss:

A financial asset shall be classified and measured at fair value through profit or loss unless it is measured at amortised cost or at fair value
through OCI.

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.

Classification and Subsequent Measurement: Financial liabilities:

Financial liabilities are classified as either financial liabilities at FVTPL or ‘other financial liabilities'.

Financial Liabilities at FVTPL:

Financial liabilities are classified as at FVTPL when the financial liability is held for trading or are designated upon initial recognition as
FVTPL:

Gains or Losses on liabilities held for trading are recognised in the Statement of Profit and Loss.

Other Financial Liabilities:

Other financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortised cost using the effective
interest method.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the
relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid
or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected
life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

Impairment of financial assets:

Financial assets, other than those at FVTPL, are assessed for indicators of impairment at the end of each reporting period. The Company
assesses on a forward looking basis the expected credit losses associated with its assets. The impairment methodology applied depends on
whether there has been a significant increase in credit risk. In case of trade receivables, the Company follows the simplified approach
permitted by Ind AS 109 — Financial Instruments for recognition of impairment loss allowance. The application of simplified approach does
not require the Company to track changes in credit risk. The Company calculates the expected credit losses on trade receivables using a
provision matrix on the basis of its historical credit loss experience.

Derecognition of financial assets:

The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the
financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Company neither transfers nor
retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Company recognises its retained
interest in the asset and an associated liability for amounts it may have to pay. If the Company retains substantially all the risks and rewards of
ownership of a transferred financial asset, the Company continues to recognise the financial asset and also recognises a collateralised
borrowing for the proceeds received.

0) Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the balance sheet where there is a legally enforceable right to offset
the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

p) Employee benefits

1) Short term obligations

Liabilities for wages and salaries, short term compensated absences and ex-gratia short terms compensated absences and ex-gratia including
non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the
related service are recognised in respect of employees’ services up to the end of the reporting period and are measured at the amounts
expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefits obligations in the balance sheet.
ii) Post-employment obligations

The liability recognised in the balance sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligations
at the end of the reporting period. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.
Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in
which they occur, directly in other comprehensive income. They are included in retained earnings in the statement of changes in equity and in
the balance sheet

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.

q) Segment reporting

The Company operates only in one segment. i.e. Iron and steel.

r) Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are unpaid. The
amounts are unsecured and are usually paid within the credit period allowed. Trade and other payables are presented as current liabilities
unless payment is not due within 12 months after the reporting period. Long term trade payables are recognised initially at their fair value and
subsequently measured at amortised cost using the effective interest method.

s) Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost.
Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of
the borrowings using effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan
to the extent that it is probable that some or all of the facility will be drawn down. To the extent there is no evidence that it is probable that
some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity servicesand amortised over the period of the
facility to which it relates.

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at
least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the
end ofthe reporting period with the effect that the liability becomes payable on demand on the reporting date, the entity does not classify the
liability as current, ifthe lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand
payment as a consequence of the breach.

t) Earnings per share

i) Basic earnings per share

Basic earnings per share is calculated by dividing:

The profit attributable to owners of the Company by the weighted average number of equity shares outstanding during the financial year,
adjusted for bonus elements in equity shares issued during the year and excluding treasury shares.

ii) Diluted earnings per share

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

The after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and the weighted average
number of additional equity shares that would been outstanding assuming the conversion of all dilutive potential equity shares.

Note: 2.1 Critical estimates and judgements

The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results.
Management also needs to exercise judgement in applying the Company's accounting policies.

This note provides an overview of the areas that involved a higher degree of judgement or complexity, and of items which are more likely to
be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about
each ofthese estimates and judgements is included in relevant notes together with information about the basis of calculation for each affected
line item in the financial statements.

Critical estimates and judgements

The areas involving critical estimates or judgements are:

Estimation of defined benefit obligation — Note 36

Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including expectations of
future events that may have a financial impact on Company and that are believed to be reasonable under the circumstances.

The cost of the defined benefit gratuity plan and other post-employment benefits and the present value of the gratuity obligation are determined using actuarial valuations An actuarial valuation involves making various assumptions that
may differ from actual developments in the future These include the determination of the discount rate, future salary increases and mortality rates Due to the complexities involved in the valuation and its long-term nature, a defined
benefit obligation is highly sensitive to changes in these assumptions All assumptions are reviewed at each reporting date The parameter most subject to change is the discount rate In determining the appropriate discount rate for plans
operated in India, the management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation The mortality rate is based on publicly available mortality tables
for the specific countries Those mortality tables tend to change only at interval in response to demographic changes Future salary increases and gratuity increases are based on expected future inflation rates

Impairment of n on-financial assets

Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use The fair value less costs of disposal calculation is
based on available data from binding sales transactions, conducted at arm's length, for similar assets or observable market prices less incremental costs for disposing of the asset The value in use calculation is based on a DCF model The
cash flows are derived from the budget for the next five years and do not include restructuring activities that the Company is not yet committed to or significant future investments that will enhance the asset's performance of the CGU
being tested The recoverable amount is sensitive to the discount rate used for the DCF model as well as the expected future cash-inflows and the growth rate used for extrapolation purposes

37 Post Retirement Benefits Plan (Ind AS 19)

Defined Benefit Plan

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972 Employees who are in continuous service for a period of 5 years are eligible for gratuity The amount of gratuity payable on
retirement/termination is the employees last drawn basic salary per month computed proportionatdy for 15 days salary multiplied for the number of years of service

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

Level 2 : The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity specific estimates
If all significant inputs required to fair value an instrument are observable, the instrument is inlcuded in Level 2

Level 3 : If one or more of the significant inputs is not based on observable market data, the instrument is induded in level 3 This is the case for unlisted equity securities, contingent consideration and indemnification asset included in
levd 3

The carrying amounts of trade receivables, trade payables and cash and cash equivalents are considered to be the same as their fair values, due to short term nature Security deposits are dassified as level 3 fair values in the fair value
hierarchy due to the inclusion of unobservable inputs including counterparty credit risk The fair values of non-current borrowings are based on discounted cash flows using a current borrowings rate They are dasssified as level 3 fair
values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values

39 Financial risk management objectives and policies:

The Company's principal financial liabilities comprise loans and borrowings, trade and other payables The main purpose of these financial liabilities is to finance the Company's operations and to support its operations The Company's
financial assets include investment, loans, trade and other receivables, and cash & cash equivalents that derive directly from its operations

The Company is exposed to market risk, credit risk and liquidity risk The company's senior management oversees the management of these risks The company's senior management is supported by a financial risk committee that advises
on financial risks and the appropriate financial risk governance framework for the Company This financial risk committee provides assurance to the Company's senior management that the Company's financial risk activities are governed
by appropriate policies and procedure and that financial risks are identified, measured and managed in accordance with the Company's policies and risk objectives The Board of Directors reviews and agrees policies for managing each
risk, which are summarised as below

(A) 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 two types of risk interest rate risk & other price risks

a) 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's exposure to the risk of changes in market interest rates relates primarily
to the Company's long term debt obligations with floating interest rates The Company is carrying its borrowings primarily at variable rate As the accounts of the company has been classified as sub standard quantam of risk associated
cannot be acertained

b) Foreign currency risks

The company has no foreign exchange exposure hence, there is currency risk involved

(B) Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss The Company is exposed to credit risk from its operating activities (primarily trade
receivables) and from its financing activites, including loans to related parties, deposits with banks and financial institutions and other financial instruments
Credit risk management

The Company assesses and manages credit risk based on internal credit rating system Internal credit rating is performed for each class of 'financial instruments with different characteristics The Company assigns the following credit
ratings to each class of financial assets based 'on the assumptions, inputs and factors specific to the class of financial assets

(i) Low credit risk on reporting date

(ii) Moderate credit risk

(iii) High credit risk

42 The Schedule III to the Companies Act, 2013 has been amended in respect of certain regroupmg/disdosures vide notification dated 24th March, 2021 which are applicable w ef 1st April 2021, the figures have
been presented in the above financial statement after considering the said amendments

As per our separate report of even date attached
For KR AGGARWAL AND
ASSOCIATES,

Chartered Accountants (Kapil Kumar Jain) (Suman Jain)

FRN: 030088N Chairman & Managing Director Director

DIN: 00755228 DIN: 07841463

CA Vivek Aneja

Partner

M. No. 544757 (Komal Bhalla) (Ajit Kumar Jha)

Company Secretary) Chief Financial Officer

Place : Ludhiana
Dated : 30.05.2024